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London - Hyprop Investments [JSE:HYP], a South African Real Estate Investment Trust (Reit), has acquired a 75% interest in the largest mall in Lagos - its first investment in Nigeria.
At the same time, the remaining 25% stake in the Ikeja City Mall was acquired by JSE-listed real estate capital growth fund Attacq [JSE:ATT].
Hyprop and Attacq bought the mall from emerging markets investor Actis, sub-Saharan Africa real estate investment management and development group RMB Westport and Nigerian investor group Paragon Holdings.
The 22 000m² Ikeja City Mall opened its doors in December 2011, fully let and attracts up to 800 000 shoppers per month. It has a tenant mix anchored by Shoprite and also offering South African brands such as Mr Price, Spur, MTN and Markham. International brands at the mall include Nike, Lacoste, Tommy Hilfiger, TM Lewin, Mango, i-Store, KFC, and Max Fashion.
According to Hyprop, the acquisition complements its strategy of investing in high quality, income-producing shopping centres in key cities across sub-Saharan Africa.
“Hyprop is well-placed to capitalise on opportunities across sub-Saharan Africa, due to its partnership with the Atterbury Group and Attacq, whose combined expertise facilitates exploiting opportunities as they arise,” said Pieter Prinsloo, CEO of Hyprop.
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For Attacq the investment is also strategic. CEO Morné Wilken said it forms part of Attacq’s larger African investment strategy.
"It is our first investment in Nigeria, an African market with fantastic growth prospects. It adds to our investment in the growing portfolio of dominant, quality retail malls in sub-Saharan Africa,” said Wilken.
According to David Morley, head of real estate at Actis, the deal reflects the strong retail opportunity in West Africa and the interest of quality institutional investors in sub-Saharan real estate assets.
RMB Westport director Michael O'Malley added that the company has earmarked a number of sub-Saharan Africa territories as key jurisdictions in which to develop retail and commercial property.
Over 40% of Actis’ investments are located in Africa, with over $1.9bn invested across 18 countries on the continent.
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"Private consumption is increasingly emerging as one of the key drivers of growth in African economies and foreign direct investment remains strong," said O'Malley.
Frank Obi, group executive director of Paragon Holdings described the development of the mall as a landmark project and "a testament to the foresight and resolve of our leadership and to the position of Lagos State and its government as leading hosts to serious investors in Africa"
"We look forward to working with quality foreign investors to develop outstanding real estate projects in the years ahead,” said Obi.
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