Pan African private equity firm Phatisa has entered into a deal with real estate developer Tamarind Properties to fund the construction of 140 residential houses in Nakuru town.
Phatisa is funding the project, known as Nakuru Meadows, through its Pan African Housing Fund (PAHF). The development will sit on 10 acres along the Nairobi-Nakuru Highway in Lanet area.
Tamarind has initially priced the houses at between Sh10.8 million and Sh13.5 million, meaning the project’s value could be worth between Sh1.5 and Sh1.8 billion on completion. The project has been named PAHF’s largest investment in Kenya.
“Construction of the units will be done in two phases. Phase one will comprise 104 units, and phase two 36 units, with an estimated completion time of 24 months,” said Tamarind Properties’ managing director Joe Mungai.
Phatisa does not usually disclose the financial size of its investments, but its criteria is to make investments of between $5 million (Sh525 million) and $24 million (Sh2.52 billion) in exchange for a majority or a significant minority equity stake and board representation.
Nakuru’s growing population has created a housing shortage in the town, pushing up land, rent and buying prices for houses and, in turn, attracting real estate developers eyeing the demand.
The fund in March announced a joint venture with Africa Reit Ltd, a Nairobi-based property development company, to build 1,400 studio apartments valued at Sh1.8 billion on six acres behind Galleria Shopping Mall in Karen, Nairobi.
Last November, Phatisa said it was partnering with In-Time Capital, a developer, to construct 80 one-bedroom apartments in Westlands, Nairobi, that will each cost Sh9.95 million.