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Cytonn Investments Raises The Bar In Kenya’s Real Estate Industry With Multi Billion Projects And Steady Growth

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Cytonn CEO Edwin Dande

Real estate remains a preferred investment venture in Kenya and one needs excellent knowledge of the market and that’s why investment firms are working around the clock to satisfy and give clients a top class treat.

Cytonn Investment, a young entrant into the industry is such that is cutting out a nitch with its rapid and steady growth commanding a firm grip in the wide pitch.

Investment firm Cytonn earlier this year  announced three fold growth in net profit to Sh398 million for the year ending December 31, 2017.

The 276.7 per cent rise in profit was up from 105.7 million recorded within the same period in 2016.

Cytonn attributed the sharp rise to a strong revenue growth arising from construction projects and the realization of gains from investment in the stock market.

The firms group revenue doubled to Sh1.01billion from Sh543.94 million announced in 2016, while that of the company went up to Sh193.4 million from Sh119.86 million.

The growth in total assets was driven by strong growth in the real estate projects under mandate, with Investment Property growing to Sh10.8 billion in 2017 from Sh8.9billion in 2016.

Investments in financial services through quoted Private Equity Investments delivered Sh342.1 million to the firm in revenue in 2017.

Cytonn prides of some outstanding Real Estate projects in the country that is making it a preferred investment firm in the new economy times. Some of the mega projects are as below:

1.Cytonn Towers

Cytonn Towers is a proposed iconic Mixed-Use Development on a 4-acre parcel in Kilimani, at the junction of Argwings Kodhek and Elgeyo-Marakwet Road, 10 minutes from Nairobi CBD. The development will be built to embody world class standards in destination real estate and is expected to be Nairobi’s premier Business, Retail and entertainment, Hospitality and Residential address when complete.

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2.RiverRun Estates

RiverRun Estates is a master-planned development to be undertaken on a 100-acre parcel located in Ruiru, Kiambu County approximately 7 Km from the Thika Superhighway and 1.5 km off Kiambu-Kamiti Road and falls within the precincts of both Tatu City and Migaa Golf Course.

The development has lots of green spaces, outdoor play areas and recreational facilities including swimming pools, a water park, access to a dam with a water frontage of 800m and clubhouse facilities. The residential units are in clusters to enhance community living and security within the units.

3.The Ridge

The Ridge is a comprehensive and luxurious mixed-use development located in Ridgeways, Nairobi approximately 10 km from the CBD, 300m from the junction of Kiambu Rd and the Northern Bypass, 5 minutes’ drive from the Two Rivers Mall, the biggest shopping mall in East Africa, less than 5 minutes’ to Windsor Golf Club and 10 minutes’ from UNEP headquarters in Gigiri.

Taraji Heights

4.Taraji Heights

Taraji Heights is a comprehensive mixed-use development where style, nature, community living and convenience meet. Nestled in the scenic and serene environment of Ruaka, Taraji Heights is only 30 minutes from the Nairobi CBD, 5 minutes from the Northern Bypass and 10 minutes from UNEP headquarters in Gigiri. The development comprises 2, 3 and 3 bedroom apartments with a DSQ, a retail facility, a private clubhouse with a swimming pool, gym and spa and well-manicured gardens.

5.The Alma

The Alma is a comprehensive residential development with modern 1bd, 2bd, and 3bd apartments & impeccable finishing. The project is strategically positioned in the heart of the fast-growing Ruaka neighborhood. It is only a 20minutes drive from the CBD and 40 minutes drive during rush-hour. The adjacent suburbs Runda, Rosslyn and Muthaiga also make the location quite secure and attractive for investors.

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6.Amara Ridge

Amara Ridge, an exclusive private gated community in Karen, is close to everything in Karen yet tucked away from it all. Conveniently located with easy access to Lang’ata Road and Ngong’ Road, residents have an array of amenities to enjoy and events to keep their calendars buzzing with activity all year round.

7.Newtown

Newtown is an exceptional master planned development within the greater Nairobi Metropolis that once complete, will comprise of residential, commercial, educational, logistics, recreational & hospitality precincts. Newtown sits on approximately 1000 acres located in Athi River, Machakos County, approximately 10 km off Mombasa Road along Mutongoni Road. The development aims to provide a world-class city that will create a Live, Work & Play environment while creating traction for the area.

Cytonn has also received the go-ahead from the competition watchdog to buy Nairobi’s luxury hotel-cum-furnished apartments vendor Wasini Resorts.

In last Kenya Gazette notice, the Competition Authority of Kenya said it had approved the sale, which will see Cytonn acquire 100 per cent shareholding in Wasini Resorts.

The Cytonn executive said there was a big opportunity for serviced apartments across Kenya to serve growing demand by short to mid-stay travellers visiting Kenya and the region.

Due to lack of a single furnished apartments’ operator especially within Nairobi’s Westlands, Kilimani and Upper Hill Cytonn has seen a huge investment opportunity.

Cytonn is undertaking a serviced-apartment development of its own in Westlands to complement similar homes in Ridgeways. More furnished apartments are also under development at the 35-floor Cytonn Towers in Kilimani.

The firm, through its real estate arm Cytonn Real Estate, has 10 ongoing residential and commercial projects reportedly valued at Sh82 billion. It is also the 5th largest shareholder in regional lender, NIC Bank.

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Urithi Adopts A Unique Model To Deliver Affordable Housing In Kenya

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Urithi Housing Cooperative Society Chairman Samuel Maina handing over the keys to the new owners of one of the houses during the handing over ceremony of Springs View gated community estate in Gatuanyaga Location of Thika East in Kiambu County.

Since President Uhuru Kenyatta unveiled his Big Four Agenda during his inauguration to serve his second term in office, the different sectors that anchor his legacy have been making all necessary alignments to fit into the presidential vision which can only be achieved through collaboration between public and private sector players.

One of the pillars of President Kenyatta’s legacy is affordable housing, with a target of 500,000 new housing units per year.

Opinions and commentaries have been penned but what has stood out is the many experts who have made a strong case that the projected numbers can only be achieved if stakeholders would embrace the socio-economic model of housing provision.

Legend supports this narrative yet fact is that it is not exclusively dependent on this model but that this will largely drive the realization of this pillar. So what is the socio-economic model of housing, how does it work and does any of the current players in property business operate on this model?

The model is entirely dependent on members, whose contributions are key and vital in initiating and executing any project that seeks to provide housing, be it public or private. Upon payment of a pre-determined deposit or down payment, the balance of the cost is spread out and paid over a period of between 12 and 48 months.

Samwel Maina, the Chairman of Urithi Housing Society, the only player that operates on this model, says monthly subscriptions vary from one member to the other depending on their economic ability.

“For the project timelines to be achieved, also entirely depends on the speed of members to make their contributions. However, slow remittance by some members has contributed to delays being experienced as most times the society has to move with the speed of the slowest member in payment,” he says.

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“Speed is determined by how fast you get money from members. But due to the uncertainty and unpredictable nature of contributions and cash flows we adjust accordingly.”

The pricing does not change over time “simply because the model mitigates on cost of labor, land and materials. Hence making it affordable without changing the initial price.”

Being an off plan project, there are critical steps, approvals and mandatory procedures that must be undertaken. Market sounding is the first of the many steps and acts a notice of the intention to undertake the project.

Then follows mobilization which entails recruiting members and other stakeholders, which process is followed by pursuit of statutory and other approvals by various government bodies, both national and county level.

Once the necessary approvals have been granted, the groundbreaking marks the beginning of construction work, whose completion is entirely dependent on members’ fidelity to make subscriptions.

“There are incidents where a member pays their subscriptions in full and expect that they would get their units but the principle here is that we pool together to own together.

“The explanation is very simple. While you may have paid yours in full, the model works in such a way that those who pay upfront help kick-start the project and sustain it by making the first commitment which is key to property ownership and the subsequent subscriptions take us through to the tail end,” adds Mr. Maina.

Urithi has over the past six years, completed and handed over thousands of housing units in Springviews in Thika, Plainsview in Juja, Gem1 in Witeithie and Lanet Homes (Nakuru and Juja).

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They intend to complete and hand over all housing projects currently under construction in the next 12 months. They include Utange – Mombasa, Gem2 and Rongai Homes which are set for completion in the next quarter for handing over to the members, while investors in the Osteen Terrace Gardens will be delivered by the last quarter of 2019.

“The OTG project is the first-of-its-kind to enable us achieve affordable housing for our members and we are using the socio-economic model. This particular project [OTG] is very timely and it will hugely compliment the government’s efforts in attaining the big 4 agenda – the housing component, by engaging other stakeholders like us,” adds the Urithi boss.

President Uhuru Kenyatta’s Big Four Agenda focuses on expanding the manufacturing sector, Universal Health Care, Food security and Affordable housing.

Under the affordable housing pillar, the government through the National Housing Corporation and collaboration with private sector players, intends to construct 500,000 units annually by using innovative construction methods and low cost building and construction materials.

“The government will achieve its dream fast if they partner with the saccos and cooperatives. Cooperatives and Saccos have structures, a wide geographical reach and most importantly members,” avers Mr. Maina, who believes affordable housing is a major milestone towards achieving the other three pillars of President Kenyatta’s legacy plan.


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Airtel Kenya And Telkom Make Official Their Merger To Face Off Safaricom’s Dominance

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Telkom Kenya Limited and Airtel Networks Kenya Limited, today announced the signing of a binding agreement that will see the shareholders of the two companies enter into an agreement to merge their respective Mobile, Enterprise and Carrier Services businesses in Kenya to operate under a joint venture company to be named Airtel-Telkom.

Telkom Kenya Limited’s real estate portfolio and specific government services will not form part of the combined entity. The final shareholding will be determined at the closing of the transaction. Telkom Kenya has the option of holding up to 49 per cent of that shareholding.

The merged company will be chaired by Telkom Kenya Limited CEO, Mr. Mugo Kibati while Airtel Networks Kenya Chief Executive, Mr. Prasanta Sarma, will be appointed Chief Executive Officer.
The finalisation and closure of the transaction is subject to approval by the relevant authorities.
Airtel Networks Kenya Limited (Airtel Kenya) and Telkom Kenya Limited (Telkom Kenya) will see no immediate changes to their operations which will continue as usual.

Similarly, there will also be no change to the current respective leadership and management, legal, organisational and staffing structures. Additionally, both brands: ‘Airtel’ and ‘Telkom’, as well as their respective products and solutions, will continue to co-exist. Similarly, service delivery to the respective companies’ customers as well as engagement with all business partners of both companies will continue to operate as usual.

As per the agreement, both the partners will combine their operations in Kenya and establish an entity with enhanced scale and efficiency, larger distribution network and strategic brand presence, thereby enhancing the range and quality of products and service offerings in the market, and greater choice and convenience to the consumer.

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The combined entity will see sustained investments in networks to further accelerate roll out of future technologies. The Enterprise and Carrier Services businesses will get a boost with a larger fibre footprint and increased number of enterprise customers – including both large corporations and SMEs who would have access to a diverse portfolio of world-class solutions.

Commenting on the agreement, National Treasury Cabinet Secretary, Mr. Henry Rotich said:
“This move is well aligned with the government’s agenda to optimise the value of the assets that it holds in trust, on behalf of Kenyans, while cementing the country’s position not only as a regional business hub but also as an international investment magnet.”

ICT Cabinet Secretary, Mr. Joe Mucheru commented: “ICTs remain a vital link to achieving Kenya’s economic goals and our national development agenda, particularly with respect to service delivery. Such mergers have had positive impact on the development of the sector and service levels to consumers in other markets. Similarly, we look forward to this merger leading to the introduction of new technologies and telecommunication products which will, in turn, support the growth of other business sectors of our economy, thereby spurring national production to meet the growing demand locally and beyond.”


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RBA Gives Cytonn Investment The Nod To Manage Retirement Benefit Schemes Funds

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Investments Manager at Cytonn Maurice Oduor.

Cytonn Asset Managers Ltd (CAML) says it has been registered and authorised by the Retirement Benefits Authority (RBA) to manage retirement benefit schemes funds.

The Capital Markets Authority (CMA) also licensed CAML in March 2018. The Cytonn arm said it will “further grow its regulated products portfolio to include fund management services for retirement benefits schemes” following the nods.

“Despite the retirement benefits assets under management growing to about Sh1.2 trillion as of June 2018, only 15 per cent of Kenyans belong to a registered pension scheme and there is a vast opportunity to increase this,” said Cytonn Asset Managers principal officer Maurice Oduor.

“With this licence, we look forward to adding value to the retirement benefits industry by reaching more Kenyans and enabling them to save for their retirement and securing their future.”

According to Zamara, a pension fund administrator, pension funds only earned 9% p.a in the last year. The entry of Cytonn into the pensions industry brings high yielding products earning upto 18% p.a into the industry.

Cytonn Asset Managers earlier acquired Seriani Asset Managers Ltd.


Kenya Insights allows guest blogging, if you want to be published on Kenya’s most authoritative and accurate blog, have an expose, news, story angles, human interest stories, drop us an email on [email protected] or via Telegram
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