The Project Sponsor is AR2 is a private equity fund that makes equity investments in real estate development projects in Sub-Saharan Africa, primarily in but not limited to Ghana, Kenya, Mauritius, Nigeria, Rwanda, South Africa, Tanzania and Uganda. The US$268 million AR2 is a follow-on fund to a first fund that closed in July 2006 with a size of US$154M.
To implement the Project, AR2 has partnered with Mabani Holdings (Local Partners). Mabani Holdings are established reputable regional entrepreneurs active in Nigeria, Togo, Benin and Ghana, as well as in Europe. Mabani Holdings primary business in Ghana, the Forewin Group, was established in the early 1990s as a distribution company for imported fast moving consumer goods (FMCG). Since then, the Forewin Group has grown into a regional conglomerate of businesses focused on (i) importing and distributing FMCGs and white goods; (ii) warehousing and logistics; (iii) retail; (iv) leasing services; (v) biscuit manufacturing, as well as (vi) land banking, real estate and construction.
CDC, a development finance institution wholly owned by the UK Government’s Department for International Development, has co-invested in the Project alongside with AR2 as one of AR2’s limited partners.
The Project company’s ownership structure is as follows:
Local Partners

49%
AR2

37%
CDC

14%
Total

100%

The total project cost is estimated at US$115 million. IFC is considering to extend an A loan package of up to $26.3 million and to mobilize a B/ parallel loan package of up to US$31.2 million to cover the debt requirements of the Project.

26.30 million (USD)

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	26.30
Equity

* These investment figures are indicative

The Project will be located on a greenfield 6.9 ha site directly adjacent to Liberation Road, the main arterial road connecting Accra to the airport. The site is situated within the urban area of Accra and has been previously cleared of indigenous vegetation and is largely barren, grassed or inhabited with alien shrubs.

- Catalytic Role: IFC is expected to mobilize all debt for the Project in volumes and with tenors not available locally.

- Sector Expertise: the Project will benefit from IFC''s technical expertise in the hotel and property development, including profound knowledge of international practices with respect to pre-leasing arrangements;

- Green Building Advice: IFC''s green building specialist will be involved in the Project providing valuable advice to the client;

- Enhancement of E&S and Corporate Governance Practices: IFC''s involvement will ensure that the Project is implemented based on the international best practice in the E&S and corporate governance areas.

- Business Infrastructure Development: The Project will help alleviate the lack of modern business infrastructure in Accra;

- Urban Development: By establishing a green, modern, efficient mixed-use development outside Accra''s CBD the Project will contribute to resolving urban congestion and pollution problems;

- Green Construction Standards Transfer: Actis has helped pioneer the establishment of sustainable real estate development and governance in Sub-Saharan Africa and intends to reinforce this commitment going forward. Actis will use the IFC''s Tourism Retail & Property sector team-developed sustainability guidelines and measures to increase energy efficiency, encourage quality and decrease environmental impact of developments throughout their life cycle, while optimizing the Project, equipment and operational costs;

- Support to Local SMEs: The Project mall is expected to become a platform supporting local SME business. Actis expects more than 30 such local businesses to become tenants in the mall;

- Job Creation: The Project will create additional direct and indirect employment during the construction and operational phases;

- Benefits to Local Suppliers: The Project will help increase business opportunities to local subcontractors, property service companies and suppliers of other goods and services throughout the construction period, as well as during operations;

- Increased Tax Revenues: The Project will generate tax revenue to the government of Ghana.

The proposed investment is expected to have limited environmental and social impacts which will be site-specific with none anticipated to be significant. Further, the impacts can be avoided or mitigated by adhering to recognized performance standards, procedures, guidelines and design criteria as described in the following sections. Thus this is a Category B project in accordance with IFC’s Environmental and Social Sustainability Policy. Following implementation of the Environmental and Social Action Plan (ESAP), the Project will be in compliance with applicable IFC’s Performance Standards and the World Bank Group (WBG) General and sector-specific (Tourism and Hospitality Developments) Environmental, Health and Safety (EHS) Guidelines.

Key environmental and social issues applicable for this investment are; i) design and construction of the Project in accordance with accepted building codes and standards, notably that related to life and fire safety; ii) effective implementation of an environmental management plan for the construction phase; iii) labor and working conditions for construction staff and those associated with the Project’s operational phases, inclusive of occupational health and safety; and iv) Energy-and resource efficiency features in the design and operation of buildings.

Please refer to the related Environmental and Social Review Summary (ESRS) document for this project.

Please refer to the Environmental and Social Action Plan (ESAP) tab in the related Environmental and Social Review Summary (ESRS) document for this project.