Africa-focused private equity firm Actis has said that South African luxury fashion houses Edgars and Foschini are some of the retailers that have booked stores in its Sh12.6 billion ($144 million) 50,000 square metres Nairobi shopping mall which is under construction and expected to be Kenya’s biggest mall.
The continued growth of the middle class has driven an increase in purchasing power in the region which has provided opportunities for consumer goods and services providers and fashion giants like Edgars and Foschini.
The opening of Edgars’ and Foschini’s stores next year, is in line with expansion plans by both firms to tap into opportunities in other regions of Africa’s fast rising economy.
According to Business Daily, currently, Foschini has 200 stores spread across Southern Africa dealing in jewellery, footware, handbags and clothing while Edgars which retails luxury clothing, footwear, textiles and accessories, has more than 100 outlets across South Africa, Botswana, Namibia, Swaziland, Lesotho and Namibia.
In 2011, Its sales hit about Sh110 billion ($126 billion) and Foschini’s earnings was Sh145 billion ($166 billion).
Reports reveal Africa’s largest retailer of general merchandise Massmart, has also booked stores in Garden City, another significant real estate development on Thika Superhighway.
The Thika superhighway is a major road in Kenya linking the city of Nairobi to Thika town which is currently lined by several shopping malls occupied by both local and foreign brands.
South African companies like media retailer Nu Metro, fast foods giant Nandos, household goods outlet Supreme Furnitures and magazines publisher Media24, have found it difficult to capture the Kenyan market, thereby forcing their exit from the market.
Brands like Truworths, Woolworths and Mr Price have had to enter into franchise agreement with local retailer Deacons, to succeed in Kenya’s market.
Actis’s ten person real estate team has already established a visible portfolio for the second African real estate fund with developments in Kenya, Ghana, Nigeria and Zambia; these include Ghana’s first green office building One Airport Square in Accra, and East Africa’s largest retail centre, Garden City in Nairobi.
Actis is private equity real estate firm investing exclusively in Africa, Asia and Latin America. Since 2006, Actis has developed ten institutional quality assets in five countries in sub-Saharan Africa including Ikeja City Mall and The Palms in Lagos, and Accra Mall in Accra.