Table of Contents
Key Points
- Acorn Holdings repaid $21 million of its $44.1-million green bond early, reflecting strong financial confidence in Kenya's real estate market.
- The green bond, issued in 2019, financed student housing projects, providing over 7,000 beds and targeting an additional 2,500 beds across Nairobi.
- Acorn's assets now total Ksh18.3 billion, supported by successful REITs, with plans for expansion into Eldoret and recent dividend distributions to unit holders.
Acorn Holdings Africa, a leading property development firm based in Nairobi and headed by real estate magnate Edward Kirathe, has successfully repaid Ksh2.7 billion ($21 million) of its Ksh5.7-billion ($44.1 million) green bond ahead of its maturity date. This decision highlights Acorn's strong financial position and solidifies its leadership in Kenya's real estate market.
Strategic bond repayment reflects financial confidence
The bond, initially issued in 2019, was critical in financing Acorn’s large-scale student housing projects across Nairobi, particularly in prominent locations such as Chiromo, Thika Road, Hurlingham, and Makadara.
Through its Acorn Student Accommodation (ASA) initiative, the firm has provided more than 7,000 student beds, with plans for an additional 2,500 beds. The green bond offered investors a competitive return of 12.5 percent, positioning it as a sustainable investment aimed at fostering eco-friendly housing solutions.
While Acorn has not disclosed the exact funding sources for the expedited bond repayment, the action signals the company’s strong cash flow capabilities, potentially driven by its successful real estate investment trusts (REITs).
Green bond surpasses financial expectations
Acorn's impressive growth is largely attributed to its two REITs—the Acorn Student Accommodation Development REIT (ASA D-REIT) and the Acorn Student Accommodation Income REIT (ASA I-REIT). These vehicles have significantly enhanced Acorn's presence in the student housing sector, providing stable returns and reinforcing the firm's financial foundation.
“The success of this green bond has surpassed expectations, reinforcing our financial standing while fostering socioeconomic impact through affordable student housing, climate-friendly development, and job creation, particularly for women-owned enterprises,” stated Edward Kirathe, CEO of Acorn Holdings.
Daniel Warutere, director of market operations at CMA, added, “This bond’s distinctive structure highlights the maturity of the market and sets a benchmark for other entities to consider bonds as a viable capital-raising strategy.”
Acorn's asset value hits $142 million
Under Edward Kirathe’s leadership, Acorn now manages assets worth Ksh18.3 billion ($142 million) across over 65 projects. The company’s student housing portfolio comprises 17,000 purpose-built student accommodation (PBSA) beds across 17 properties, with an additional 6,000 beds currently under construction.
In a bold expansion strategy, Acorn has recently acquired land in Eldoret, marking its first foray into student housing outside of Nairobi. Additionally, the firm secured Ksh2.8 billion ($21.7 million) in fresh capital to bolster its asset portfolio and operational capabilities.
Acorn's financial strength is further demonstrated by its recent decision to distribute Ksh482.8 million ($3.64 million) in dividends to unit holders of its REITs, underscoring its growing influence in the regional property market.
