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Centum’s Rea Vipingo coastal city deepens foray into real estate
NSE-listed investment company Centum has started preparations for the construction of an exclusive 9,500-acre coastal city in Kilifi County, deepening its foray into high-end real estate development.
Centum, which is also behind the Two Rivers Mall, tipped to be Kenya’s biggest on completion, is building the city on land that it purchased last year from Rea Vipingo Holdings-- a plantations firm that sold part of its land as it de-listed from the Nairobi Securities Exchange (NSE).
Regulatory filings show that the project will be developed in phases. The first phase of the project will see Centum put up infrastructure on 900 acres of land at a cost of Sh794.3 million.
Centum has divided the 900 acres-dubbed the economic hub- to include residential, commercial, industrial, institutional, recreational, and public zones.
The infrastructure development points to a likelihood that Centum will be inviting investors to set up or settle in the area under lease in the same way as similar developments like the planned Northland City by the Kenyatta family and Tatu City.
“The Master Plan development has been phased for over 30 years and it will be gradually implemented at an average rate of 900 acres in the first years and 200 acres per year starting with areas without sisal and later on land with old crop that will not be replaced,” says part of the regulatory filings.
This is the latest in a string of recent high profile investments that have accelerated the NSE-traded firm’s diversification away from just having a portfolio of listed and non-listed equities.
READ: Kenyatta family seeks approval for its dream city outside Nairobi
The Two Rivers Mall set on 100 acres is set to be completed in the coming months. Centum is also developing Pearl Marina in Uganda— a project that consists of two hotels, office blocks and apartments set on 385 acres.
The investment company is also building a 1,000-megawatt coal-fired power plant in Lamu that will sit on 869 acres.
Centum typically employs a partnership model in these projects, which helps to bring in the capital needed and also spread the risk. Its subsidiary, Athena Properties Ltd, a construction firm, will undertake the infrastructure works for the project.
The Nema report indicates that the city will have a sports stadium and different residential zones. There will be a high-end residential area, higher income residential on the ridges and lower-cost residential housing closer to the industrial park.
The investment firm is also counting on the proximity of the area to the Mombasa Port and the Moi International Airport (about 30km) to attract industrial and other commercial investors.
“The site is strategically located between growing Mtwapa and Kilifi towns interconnected to the port of Mombasa, Mombasa Airport and the LAPSSET project,” the report adds.
“The proposed infrastructure development for Phase I of Vipingo Mixed Use development is anchored on providing the most cost effective place to do business.”
The development will include solar and wind farms to generate up to 30 per cent of its power needs.
It will border the extensive Vipingo Ridge that hosts swanky coast homes for politicians and wealthy businessmen.
Centum snapped up the extensive sisal farm from Rea Vipingo last year at a cost of Sh2 billion.
Although originally estimated to be 11,794 acres, the Nema report says that a fresh survey conducted early this year confirmed that the land measures 9,574 acres. This shaves off 2,220 acres from the original estimate.
Centum’s profits have been on ascendancy, buoyed by several investments across different investment sectors.
The company’s half-year net profit for the period to June last year rose by 55 per cent to Sh1.9 billion boosted by its investments in Almasi Beverages and K-Rep Bank.Besides the multi-billion deals, the company has also been investing in several smaller projects and firms.