Grit Enters $25 Mln Loan Deal to Fund Kenyan Site Acquisition
Grit Real Estate Income Group Ltd. said Friday that it has entered a $25-million loan agreement with the International Finance Corporation in order to acquire and redevelop a warehousing and manufacturing facility in Nairobi, Kenya.
The pan-African real-estate company said the investment arm of the World Bank provided a senior debt facility, of which $16.1 million will fund the purchase and $8.9 million will fund redevelopment. The loan has a tenure of eight years and an applicable interest rate of 5.75% a year above six-month Libor rates.
Grit will acquire the Nairobi facility and lease it back to Orbit Products Africa Ltd. on a new 25-year triple net lease, an agreement which requires the tenant to pay all the expenses of the property.
The deal is expected to complete in August, with further redevelopment and expansion undertaken from the second quarter of 2022. The total investment for the acquisition and redevelopment is expected to be $53.6 million.
“The transaction, which will further increase Grit’s exposure to Kenya and the broader light industrial sector, is expected to be accretive to both net asset value and earnings, delivering further sustainable value to our shareholders immediately,” Chief Executive Bronwyn Knight said.
Source: Dow Jones