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CDC invests in new Africa vehicle

The UK government’s investment arm dedicated to emerging markets has placed $100m into a vehicle focused on property in African—its first commitment to a fund focused solely on property.

CDC, the UK government-backed emerging-markets private equity investor, has committed $100 million (€78 million) to a new private equity real estate fund focused on Africa.

CDC will be the sole investor in the Actis Africa Real Estate Fund, which is seeking out investments in high-quality office and retail space. Actis reportedly sees the interest in office space being driven by strong growth in foreign direct investment, while the demand for retail space is being pushed by the expansion of South African retailers into Southern and Western Africa.

The fund plans to work with local partners to co-develop and acquire property developments, as well as add value to existing properties held by governments, individuals, companies and institutions. The fund will also look at distressed and turnaround situations.

The investment is CDC’s first in a real estate-focused vehicle, but in the past the organization has invested $25 million in seven African property companies.

A portfolio of CDC investments in Africa, including various properties and developments in Nairobi, Kampala, Dar es Salaam, Accra and Lagos, will be included in the fund’s portfolio.

The vehicle will be headed up by Mike Williams, the former head of African real estate operations at Standard Bank Properties. He will be based in Johannesburg.