Centum Real Estate Limited, a subsidiary of the NSE-listed Centum Investment Company Plc, plans to raise Sh4 billion from local investors to finance the ongoing housing projects in Kenya.
“Proceeds from the bond will be allocated exclusively to the subsidiary’s ongoing affordable, middle-income and high-end housing projects in Kenya,” said the firm in a statement.
Centum Real Estate has approved a project pipeline of 4,426 residential units, of which the first phase of 2,000 units is either under construction or pre-selling. Recently, the Company handed over 96 high-end homes in its Uganda and Vipingo developments.
Centum Real Estate Managing Director Samuel Kariuki said subscribers to the bond will have an option of investing in an equity-linked component. “We are keen on addressing existing gaps in the linkage between Kenya’s real estate sector and the capital markets,” he said.
Kariuki further expressed confidence in the ability of the firm to repay the bond in time, adding that all the projects are currently debt-free even as he noted that the same is funded using “internally generated resources.”
“Currently, all our projects are debt free and are funded using internally generated resources. Of the projects under construction, we have achieved an aggregate pre-sale level of 75% and deposit collections of over KES 2.6 billion, which validates our sales-led development model.”
The bond is expected to be listed for trading on the NSE at a later date. The bond will be secured by the projects with deposit collections flowing into a sinking fund.
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