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Momentum Africa RE Fund reaches $150m

The London-headquartered global investment firm has now raised $150 million for its Africa-focused real estate fund.  

Momentum Global Investment Management, the London-headquartered global investment arm of Momentum Investments and part of MMI Holdings, a South Africa-based insurance group, has brought fundraising for its Africa-focused real estate vehicle to $150 million.

Momentum Africa Real Estate Fund was launched in January this year with a fundraising target of $250 million. The capital raised via the fund is to be invested in the development of retail, commercial and industrial real estate in sub-Saharan Africa, outside of South Africa.

“Achieving the second close is a meaningful milestone because it gives us a larger war chest to commit to a swelling investment pipeline,” said David Lashbrook, head of real estate, Africa, at Momentum Global Investment Management. “We are currently working on the mitigation of key development risks on several projects so they can be presented for approval.”

The firm is targeting 18 percent IRRs from investments made over the fund’s eight-year term.

According to Warren Schultze, chief executive officer of the South Africa-based property development group, Eris Property Group, which is the fund’s advisor, the firm is reviewing projects in places such as Mauritius, Ghana, Mozambique, Nigeria, Rwanda and Zambia.

“Our investment pipeline includes more than a dozen projects and we expect to commit funds to at least two of these projects prior to the end of 2015,” he said.

According to a statement released at the time of the first close of the fund in February this year, the projects earmarked for development via the fund include an office complex in Ghana, a retail centre in Mozambique and an office in Rwanda.

The firm raised $50 million via the first close of the fund, with commitments mainly from institutional investors, family offices and high-net-worth investors. A final close is expected to be reached by July next year.