Hillcrest International Schools has put on sale 17.9 acres of prime land in Karen, Nairobi, as part of a fund raising effort for its Sh2 billion expansion plan.
The school’s owners said the expansion will see it build boarding houses to cater for 250 students, a new auditorium, sports area, a language centre, modern kitchen and dining facilities and improved mechanical centres.
The school did not disclose how much it plans to raise through the land sale but real estate dealers estimated the figure at a minimum of Sh350 million.
“The master plan for development of Hillcrest International Schools, planned for roll out over a number of years, is budgeted at approximately Sh2 billion,” said Hillcrest Investment Limited director Ayisi Makatiani in a statement.
Hillcrest Investment, a company owned by private equity firm Fanisi Capital, owns Hillcrest International Schools, which it bought from the family of former presidential contestant Kenneth Matiba and other shareholders in August 2011.
The school said it has secured all approvals for the land sales from the government.
“As the next step in the ongoing development plans for Hillcrest International Schools, the schools recently received permission from City Hall and the Commissioner of Lands to subdivide and amalgamate portions of land previously identified for sale,” said the school in a statement.
Moses Wekesa, chief executive of property firm Grad East Africa, said factors such as size of the land, demand and city zoning regulations will influence pricing of the land.
Selling the land in one parcel would yield less than subdividing, while commercial properties fetch higher prices than residential properties, said Mr Wekesa
“For Karen, where there is red soil, you are looking at between Sh20m and Sh23 million per acre,” said Mr Wekesa.
This would put proceeds at between Sh350m and Sh411 million for the Hillcrest parcel. Global property firm Knight Frank has been appointed as the sales agent.
Potential buyers will, however, have to wait until the school puts in place measures that will ensure there is no interruption in learning before they can develop the properties.
“A proviso has been placed into the sale agreement to ensure that no potential owner can move into the property until the schools have completed their arrangements to relocate current facilities that would be affected, thus ensuring that the day-to-day school activities will not be restricted by the land sale,” said the statement.
Hillcrest joins other firms that are selling part of their land holdings to take financial advantage of the boom in property prices.
Express Kenya also plans to spend part of proceeds from a Sh1 billion cash call for real estate development.
Fanisi Capital’s strategy is to invest in companies with turnover of between $1 million (Sh87.5 million) and $8 million (Sh700 million).