Taaleri to invest in Africa’s real estate

NAIROBI (Capital Markets in Africa) – Finnish private equity fund and financial services group Taaleri Plc plans to invest Sh10 billion ($100 million) in East and South African real estate projects.

Taaleri, in partnership with local private equity firm Cytonn Investments, has so far invested about Sh4 billion in the Kenyan real-estate market. The two companies are exploring more investment opportunities in both real estate and renewable energy sectors.

“East Africa is the area where we have been active. There are tremendous opportunities in the region. We started with about $50 million with the first fund. We are going to raise new funds, double the first funds, by beginning of next year,” said Taaleri Plc chief executive Juhani Elomaa.

Mr Elomaa also announced the firm was considering venturing into regional green energy projects from early next year. The two firms have projects in Nairobi, Kiambu and Meru counties.

They invested Sh1 billion in Amara Ridge, a high-end residential development in Karen, Nairobi. It sits on five acres and consists of 10 five-bedroom houses, each of which had a sale price of Sh95 million.

Cytonn has also ventured into other areas including the fast-growing middle income town of Ruaka on the outskirts of Nairobi where it is building 400 units in a gated community at Sh2.5 billion.

The project is scheduled for completion within three years and targets middle- to lower-income earners looking for modern apartments.

In Meru town, it has partnered with Fusion Capital in the ongoing mixed-use development of Greenwood City mall, which by August was 35 per cent complete.

Cytonn Investments is offering the one, two and three bedroom apartment options set on the 4.18-acre parcel of land in what it terms as a “lifestyle community”.

Taaleri’s head of Africa Antti-Jussi Ahveninen said the Kenyan market is being driven by healthy fundamentals.

“In Kenya you will not run out of ordinary families who will need a good quality home, we are here to provide those homes,” said Mr Ahveninen.

He termed the Kenyan market as having a lot of width, depth and very dynamic. He believes the Real Estate Investment Trust (Reits) regulations serve the market well and are well structured by the regulator, Capital Markets Authority.

“This allows investors like us to come into the market and fund development projects because how we see it is that even when our money leaves and we exit the ownership of the property, it will stay here and the proprietor of the new property will create jobs for Kenyans,” said Mr Ahveninen.