United Africa Group (UAG) received funding of N$80 million from Vantage Capital, a South African-based firm, towards the construction of the 181-key, three star Hilton Garden Inn hotel in Windhoek.
The debenture funding is being used to support the group’s equity contribution for the construction of a new Hilton Garden Inn, while the growing tourism demand in Namibia has been a key driver behind the funding of the project – this is in addition to the existing five-star Hilton hotel.
The new hotel will be equipped with all the amenities expected of a world-class business and leisure hotel, including a pool, sundeck, gym and roof garden. The proximity to the existing Hilton Windhoek Hotel will also allow for the sharing of services, including conference facilities.
Vantage Capital’s chief operating officer, Warren van der Merwe, said they are delighted to partner with UAG for the first investment in Namibia and Vantage’s 21st mezzanine transaction overall. “UAG has built up a quality portfolio of hospitality and commercial property assets under the strong leadership of Haddis and Martha [Namundjebo] Tilahun and we are pleased to provide them with financial backing, as they further entrench themselves as a leader in the local hospitality sector” added Merwe.
Since its inception UAG has grown rapidly to become one of the largest property-owning and hospitality groups in Namibia, with ten existing hotels in its portfolio nine operated by Protea and one by Hilton as well as commercial real estates.
David Kornik, an associate partner at Vantage Capital, said: “We always look for our funding to facilitate expansion and economic development. In this investment we are therefore proud to be supporting a local business group in a project that will have a significantly positive impact on tourism growth, as well as on the development of Windhoek’s city centre.”
UAG’s chief executive officer, Willem Mouton, expressed sincere gratitude on behalf of the group, saying: “We are pleased to bring Vantage on board as an experienced African investor, who shares our views on the exciting prospects for Namibia’s tourism and hospitality sector. We look forward to a mutually rewarding partnership in the coming years.”
The United Africa Group investment is Vantage Capital’s third transaction in Fund III, which is targeting a final close of US$260 million (N$4 billion) and has a 60% allocation to countries outside South Africa. After supporting the Servest buyout last year, Vantage’s Fund III recently concluded a $20 million investment in a Nigerian property group, Landmark.
The Fund is expecting to close its fourth transaction during the first half of 2016 for an investment of over $17m (N$250m).
– Additional reporting African Press Organisation.