The Abraaj Group, a private equity firm operating in emerging markets, today announced it has bought a majority shareholding in Ghana Home Loans (GHL), a provider of residential mortgages in the West African country.
With its head office in Ghana’s captial Accra, GHL focuses on the Ghanaian residential home buyer, offering mortgages for first time home owners.
“We are pleased to be backing an experienced local management team that has grown GHL into the market leader it is today, playing a key role in home ownership growth in Ghana and in an under-developed industry that has huge potential,” commented Jacob Kholi, a partner at The Abraaj Group.
Kholi added that The Abraaj Group will help GHL boost its operational efficiency through IT-enabled processes, and broaden its portfolio to include new product offerings.
The investment is the private equity firm’s second in Ghana over the past five months. In June the firm announced its acquisition of a 100% stake in Fan Milk International, one of West Africa’s largest dairy companies. Established in Ghana more than 50 years ago, Fan Milk is one of West Africa’s top producers and distributors of frozen dairy products and juices.
Towards the end of July, The Abraaj Group also announced the exit of its investment in Ghana-based HFC Bank.
Property industry activity
Ghana’s property industry is currently seeing a fair amount of activity – from shopping centre developments to the building of luxury apartments.
In an earlier interview with How we made it in Africa, Carlo Matta, CEO of real estate firm Laurus Development Partners, said conditions in Ghana a few years ago reminded him of Vietnam towards the end of the 1990s. “I have been travelling to Africa all my life for tourism… Before the conditions were not right to warrant any strong opportunity in real estate. And then as of lately, I’m thinking 2007/2008, I saw a change. It reminded me a lot of Vietnam when I was there in 1997. And Vietnam at the time was offering very good opportunities in the real estate sector.”
One of Laurus’s main projects currently under construction is the One Airport Square development in Accra, a multi-storey mixed-use development with office space and retail facilities.
Ghana’s young oil industry is also driving demand for upmarket apartments, according to Harry Quartey, head of Ghana-based real estate development business, Emerald Properties. To date Emerald has developed a number of apartment blocks across Ghana’s capital.
According to Quartey, the majority of buyers of Emerald’s properties are Ghanaians. Most of these properties are bought for investment purposes and then rented out to expats.
“We don’t just sell the units, but we also manage the units that we build, so we have a fairly good idea about the clientele who is coming in for rentals. We are definitely seeing an increase in companies providing services for the oil companies, as well as the oil companies themselves have taken up some of our units,” says Quartey.