Acorn secures Ksh 6.7B from Absa for 12,000 student housing units
Acorn Holdings, the purpose-built student accommodation (PBSA) developer is set to deliver 12,000 bed capacity units with a Ksh 6.7 billion financial backing from Absa Group.
Acorn Holdings Limited Chief Executive Officer Edward Kirathe said the addition to the Acorn Student Accommodation Real Estate Investment Trusts (REITs) will bring the total bed portfolio to 21,000 beds making the project the largest such portfolio in Africa.
“This Ksh 6.7 billion debt facility from Absa Bank is part of a Ksh 11 billion financing package that Acorn has put together to finance 12,000 new beds that are affordable, of high quality, and safe. The balance of the financing will come from Equity contributed through the Acorn Student Accommodation REITs which are providing a capital markets solution to finance housing in Kenya,” said Kirathe.
The student accommodation housing units are expected to be completed within 3 years and will contribute to the realization of government’s affordable housing programme and bridge the current student housing deficit estimated at 300,000 beds across the country.
“With a student housing deficit of at least 200,000 in Nairobi alone, the market is underserved. A D-REIT of this nature enables access to capital and an increased supply of purpose-built student accommodation while also providing amenities such as, high-speed internet, study and recreational common areas. Absa is committed to partnering on projects that help the youth of Africa to not only survive but thrive,” added Yusuf Omari, Absa Bank Kenya Chief Executive Officer.
Lands, Public Works, Housing, and Urban Development Cabinet Secretary Zacharia Njeru backed the partnership to further help expansion the affordable housing programme currently being implemented by the government.
“I believe that the partnership between Acorn Holdings Limited and Absa Bank will significantly contribute to Kenya’s housing deficit, even as it provides solutions towards meeting the Country’s need for more, efficient, and affordable student housing,” said Njeru.
Ten new facilities to be constructed under the financial arrangement will be located around Kenyatta University, JKUAT and the University of Nairobi.