Mauritius-based Grit Real Estate Income Group has completed the purchase of Orbit Products Africa’s manufacturing facilities from businessman Sachen Chandaria in a multi-billion-shilling transaction.
The multinational says it is investing a total of $53.6 million (Sh6.1 billion) to acquire the property and develop it further, with Orbit remaining as a tenant for an initial 25-year lease on the existing factory and warehouses.
Orbit is a contract manufacturer for global firms such as Reckitt Benckiser, Colgate-Palmolive, and Unilever, producing the fast-moving consumer goods in 20 acres of land in Mlolongo, Machakos which houses the factory.
“The board of directors … announces that all the conditions precedent related to the share purchase agreement governing the Orbit Africa sale-and-leaseback transaction in Nairobi, Kenya, have been fulfilled and that such acquisition has now been completed by the company,” Grit said in a notice.
“The board looks forward to the successful completion of the redevelopment and expansion of the Orbit Africa warehousing and manufacturing facility, which is expected to be completed in the fourth quarter of 2023 when it will be let on a new 20-year triple-net lease to Orbit Products Africa Limited.”
Grit’s chief executive Bronwyn Knight said the transaction will further increase the company’s exposure to Kenya’s real estate market and the light industrial sector in particular.
The multinational owns half of Naivasha Buffalo Mall and also holds a pharmaceutical warehouse along Mombasa Road that it leases out to South Africa’s Imperial Health Sciences Logistics.
It also owns a 19.98 percent stake in Gateway Real Estate Africa Ltd (GREA) which is building a housing estate to lease to the staff of the United States embassy in Nairobi for eight years.
The 90-unit gated property development in Nairobi’s Rosslyn estate is expected to be completed by May at a cost of $48.5 million (Sh5.5 billion).
Grit is in the process of raising its interest in the project to 50 percent. The embassy is set to pay a rental fee of $4.724 million (Sh539 million) in the first year alone, setting the developers for some of the highest returns in the local property market in dollar terms.