Property firm targets counties with Sh20b kitty

A listed real estate firm will invest up to Sh20 billion in five housing projects in counties.

Home Afrika Limited says another 10 real estate projects will follow over the next five years.

“In the 2013/18 Strategic Plan, we want to increase our capability to take advantage of opportunities at the county level.

Our medium-term plan going forward include tapping into opportunities in Africa,”said the Chief Executive Officer, Njoroge Ng’ang’a on the sidelines of the firm’s Annual General Meeting (AGM) yesterday at the Kenya School of Monetary Studies.

Home Afrika’s revenue rose sharply by 26 per cent, up from Sh348.6 billion to Sh650.6 billion on account of strong sales of inventories at Migaa, Home Afrika’s flagship project.

Improved efficiency in revenue generation saw the firm’s gross profit grow by 73.8 per cent to Sh388.9 billion, up from Sh101.9 million in 2012. Net profit declined by 25 per cent mainly as a result of low unrealised gains on investment property revaluations.

“The decline in our bottom line was not an operating loss but restatement of the figures due to requirements by international financial reporting standards,” said Ng’ang’a.

Home Afrika has undergone re-branding and plans to launch its middle income housing Sh1 million project later this year.
“We are in the process of applying for a license to issue Real Estate Investment Trusts (REITS) in order to attract capital, especially from the pension industry-which is highly liquid at the moment,” said Ng’ang’a.

While REITS are meant to raise the required capital in the real estate sector, these instruments are yet to obtain approval from the Capital Markets Authority (CMA).

“We are the first real estate firm to list Growth Enterprise Markets Segment (GEMS) at the Nairobi Securities Exchange (NSE).

The board feels that this listing has given us good exposure to the public as well as created a platform to enable us participate in the capital markets,” said Lee Karuri- board chairman at Home Afrika Limited.

“We are seeking new ways of raising capital to increase quality of our projects while reducing the turnaround time in delivery. The listed status gives us the platform to achieve all these,” said Ng’ang’a.