Centum Investments has taken a loan from South Africa based lender Standard Bank to pay back a Ksh. 8 billion loan it took from the Co-operative Bank to finance developments at Two Rivers Mall.
Despite not revealing the interest rate of the Co-op bank loan, Centum – in a news report by the Business Daily- insisted that the terms for the new credit advance are much cheaper than that of Co-op Bank. The lender also insisted that Two Rivers Mall project is less risky now than when Co-op Bank first funded the development.
Centum similarly disclosed some of the terms of the Co-op Bank deal in which it had to offer the bank a guarantee at the parent company level in order for the bank to finance the Two Rivers project.
“On the Two Rivers Mall, we had secured a Ksh.8 billion development finance facility with Co-op Bank for the then greenfield site,” Centum’s Chief Financial Officer Samuel Kariuki is quoted as saying by the Business Daily.
“Upon completion of construction and operationalisation of the mall, we sought to refinance the facility with Standard Bank into a corporate finance facility in which the Centum guarantee was dropped and the facility re-priced to reflect an operating business,” Mr. Kariuki added.
Centum currently owns 29.1 percent stake in the Two Rivers Mall project with the rest of the shares being held by institutions such as Old Mutual Property who funded the mall’s construction.
Despite Centum revealing that space occupation at the mall currently stands at 78 percent, the complex made a net loss of Ksh. 3.4 billion in the year ended March, down from a net profit of Ksh. 915.8 million registered a year before.
Centum is currently awaiting approval from the National Environmental Management Authority (Nema) to establish a residential project, dubbed Cascadia, within its Two Rivers Development that comprises 400 one, two and three bedroomed apartments.
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