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Actis, RMB Westport exit Nigeria’s largest shopping mall

The Ikeja City Mall has been sold to an Africa-focused shopping center REIT and a Johannesburg-listed real estate capital growth fund.

Emerging markets asset manager Actis alongside RMB Westport, the Sub-Saharan Africa-focused real estate investment manager, and Paragon Holdings, a pan-African conglomerate, have sold their stakes in Nigeria’s largest shopping center, Ikeja City Mall for an undisclosed amount.

Actis sold its 60 percent majority stake, while Paragon Holdings and RMB Westport have both sold their 20 percent stakes in the mall to South African Real Estate Investment Trust Hyprop Investments and Attacq, a Johannesburg-listed real estate capital growth fund.

Hyprop acquired a 75 percent interest and Attacq the remaining 25 percent in the 237,000 square foot shopping center which is located in Ikeja, a densely populated suburb of Lagos.

Actis and Paragon Holdings originally sourced the development site in 2008 with RMB Westport initially appointed as the development manager in the same year. At that stage, the asset was thought to be valued at around $100 million. RMB Westport later invested as an equity partner in 2010.

“This sale reflects the strong retail opportunity in West Africa and the interest of quality institutional investors in sub-Saharan real estate assets,” commented David Morley, head of real estate at Actis. “This is the sixth exit from the first Actis real estate fund…over two funds, Actis has committed to 17 institutional quality developments in seven countries totalling a gross asset value of $1.3 billion.”

The exit reflects the prevailing sentiment among institutional investors which are increasingly liking the region’s demographic and market picture. Sub-Saharan Africa has large, young and urbanizing populations with growing wealth, retail appetites and professional ambitions while there is a supply and demand mismatch of institutional-grade commercial and retail property.

“Private consumption is increasingly emerging as one of the key drivers of growth in African economies, and foreign direct investment remains strong,” said Michael O'Malley, director of RMB Westport.

In September PERE revealed RMB Westport brought a second opportunistic real estate fund to the market and is aiming to raise between $450 million and $500 million for the vehicle. Actis too is marketing Actis Real Estate Fund III, a fund dedicated to investments in real estate companies and projects in Sub-Saharan Africa, which has a $400 million target.