Perennial Real Estate makes its foray into Africa with S$352m deal
SINGAPORE: Local developer Perennial Real Estate Holdings is making its foray into Africa through a joint venture deal with Shangri-La Asia to develop an integrated mixed-use complex in Ghana worth more than US$250 million (S$352 million).
In a statement on Friday (Aug 21), Perennial said it will acquire a 55 per cent stake in a 49,874 square metre (sqm) site from Shangri-La Asia for S$21.3 million. The site is located in the prime airport district of Accra, the capital of Ghana.
Both parties plan to develop the site into an integrated mixed-use development which will include a hotel, residential towers, an office tower, a shopping mall and serviced apartments.
The development, with a gross floor area of 162,000 sqm, will be funded through the sale of the residential and office components to minimise the total capital outlay and optimise cash flow of the joint venture partners.
Still, part of the development cost will be funded by internal funds and external borrowings.
Perennial CEO Pua Seck Guan said: “The adoption of a part-sell part-hold strategy, coupled with the relatively high development margin, provide a compelling investment opportunity for Perennial to put in place a future engine of growth with minimal capital outlay.
“Upon the successful execution of the signature project, and on attaining the relevant expertise and recognition associated with the creation of one of the finest integrated developments in Accra, Perennial will be able to leverage on the established platform and reputation to access other African markets in the longer-term,” he added.
The development is expected to be completed in 2019.
Upon completion, the integrated mixed-use development will be managed by the joint venture partners, except for the hotel which will be managed by a subsidiary of Shangri-La.
Picture Source: Artist’s impression of the Ghana development. (Image: Perennial Real Estate)
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