Actis sells Ikeja Shopping Mall to South African property groups

South African investors in the commercial segment of the Nigerian real estate market have once again deepened their footprint in this market with the acquisition of the Ikeja City Mall estimated to have cost the developers $100 million on the construction side.

Actis, a leading emerging markets investor, RMB Westport, a notable sub-Saharan Africa real estate investment, management and development group and Paragon Holdings, a leading Nigerian investor group, who were the original investors/developers, confirmed to BusinessDay, the sale of the Mall to South African Real Estate Investment Trust (REIT), Hyprop Investments Limited (Hyprop) and Attacq Limited (Attacq), a JSE-listed real estate capital growth fund.

Whereas Hyprop  acquired a 75 percent interest in the Mall, Attacq has acquired the remaining 25 percent. Actis and the local partner, Paragon Holdings, sourced the development site in 2008.

RMB Westport, initially appointed by Actis as the development manager in 2008, invested as an equity partner in 2010.  Actis has now sold its 60 percent majority stake, while Paragon Holdings and RMB Westport have both sold their 20 percent stakes in the mall.

Ikeja City Mall, Lagos’ largest mall, is a world-class retail and leisure development in Ikeja, a densely populated suburb of Lagos, with a population of 4.5 million people. As the largest mall in Lagos, it comprises over 22,000 square metres and has a tenant mix anchored by Shoprite, offering South African brands including Mr Price, Spur, MTN and Markham and international brands including Nike, Lacoste, Tommy Hilfiger, TM Lewin, Mango, i-Store, KFC, and Max Fashion.

Actis and RMB Westport managed the development process from concept to completion, investing the initial equity, raising development finance, managing the construction, securing the tenants, operating the mall and bringing it to market at the right time, working in partnership with Paragon Holdings. The mall opened its doors in December 2011 fully let, and today attracts up to 800,000 shoppers per month.

The Mall is Hyprop’s first investment in Nigeria and this acquisition is an attractive investment that complements Hyprop’s strategy of investing in high quality, income-producing shopping centres in key cities across sub-Saharan Africa.

CHUKA UROKO with agency reports