Stanbic Bank and MiDA Advisors have announced they will partner with Acorn Holdings, an established real estate developer, to mobilise $700 million in long-term blended finance commitments for green, affordable student housing in Kenya.
Upon approval, the transaction will comprise a $180 million commitment from the United States Development Finance Corporation (DFC) that will secure over $380 million in equivalent KES financing arranged jointly by Stanbic Bank Kenya and MiDA Advisors, and $315 million in equivalent KES financing from Kenyan capital markets, for a total blended financing of $700 million over an 18-year timeframe.
Commenting on the transaction, Dr Joshua Oigara, Stanbic Bank Kenya and South Sudan CE said, “As a Bank, we pride ourselves on being a catalyst for growth in the region, with sustainable finance acting as an enabler. This blended finance deal would mark one of the largest impact investment transactions in Kenya, with long term impact on job creation, sustainable housing and education. We are in the final stages of the structuring process and remain committed to the growth of Acorn Holdings and to the country’s sustainable infrastructure goals.’’
Adding to this, Alakh Kohli, Stanbic Bank Kenya Head, Corporate and Investment Banking said, “In the past years, we have mobilized about $122 million for green or sustainability linked facilities and we remain keen on unlocking more green finance opportunities in Kenya. This partnership would not only advance our growth journey with Acorn but would help us drive more societal impact. We are excited to be lead arranger in one of the largest transactions in affordable green housing in the region and will leverage our investment capabilities to drive a successful transaction upon approval.’’
The collaboration will result in the construction of 35 certified green housing projects, creating approximately 48,000 new student beds over the next 10 years, making it the single largest investment into student housing in Africa.
This project will be key to alleviating the shortage of quality and affordable accommodation for tertiary students in Kenya. The initiative will create an estimated 15 000 direct jobs and 35,000 indirect jobs.
The units will also provide a conducive learning environment for the students, helping to improve access to education.
This is not Stanbic Bank’s first collaboration with Acorn Holdings. The Bank was instrumental in bringing the first-ever green bond to East Africa, in association with Acorn Holdings, for environmentally friendly student housing in Nairobi.
Standard Bank also facilitated the largest purchase of Acorn Holdings’ Income and Development Real Estate Investment Trusts (REITs) through the Unquoted Securities Platform.
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