Mauritian firm Grit Real Estate Income Group is set to spend Sh2 billion ($15.5 million) on the further development of Orbit Products Africa’s manufacturing facilities which it acquired in March last year from businessman Sachen Chandaria in a multi-billion-shilling transaction.
The London-listed multinational’s phase two redevelopment of the facility will see it put up an additional 14,741 square metres of warehousing space on the bulk land that it acquired as part of the purchase of the property.
“Orbit Africa phase two redevelopment: expected to be $15.5 million (inclusive of VAT) to be completed by April 2024,” said Grit in its financial filings for the six months ended December 2022.
In addition to the new facilities, Grit says on its website that the second phase of redevelopment will also involve the refurbishment of the existing 29,243 square metres of warehouses, meeting modern industry standards for fast-moving consumer goods and achieving an IFC EDGE green building certification.
Grit purchased the Orbit facility in a deal worth $53.6 million (Sh7 billion), adding to its growing portfolio of commercial real estate in the country.
Orbit is a contract manufacturer for global firms such as Reckitt Benckiser, Colgate-Palmolive, and Unilever. Under the deal, Orbit remains as a tenant for an initial 25-year lease on the existing factory and warehouses.
By end of December, Grit valued the Orbit facility at $40.53 million (Sh5.33 billion),
Following the acquisition in March, Grit subsequently sold a 30 percent stake in the Mlolongo-based facility in July 2022 to Botswana real estate firm Letlole La Rona Limited (LLR) for an initial consideration of $7.23 million (Sh952 million).
Grit holds a minority stake of 11.25 percent in Letlole, making them related parties.
The growing property portfolio has seen Grit establish a fully-fledged office to serve its interests in the East Africa region which include retail, storage and high-end residential property.
In the storage and logistics segment, Grit also owns a pharmaceutical warehouse along Mombasa Road that it leases out to South Africa’s Imperial Health Sciences Logistics.
Kenya accounted for 11.7 percent ($2.6 million/Sh341.6 million) of its net property income of $22.12 million (Sh2.9 billion) in the six months ended December 2022.
