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Environmental and Social Review Summary
Kasada Hospitality Fund LP
This Environmental and Social Review Summary (ESRS) is prepared by MIGA staff and disclosed prior to the date on which MIGA’s Board of Directors considers the proposed issuance of a Contract of Guarantee. Its purpose is to enhance the transparency of MIGA’s activities. This document should not be construed as presuming the outcome of the decision by MIGA’s Board of Directors. Board dates are estimates only.
Any documentation that is attached to this ESRS has been prepared by the project sponsor, and authorization has been given for public release. MIGA has reviewed the attached documentation as provided by the applicant, and considers it of adequate quality to be released to the public, but does not endorse the content.
Kasada Hospitality Fund (“Kasada” or “the Fund”) is a US$500 million hospitality sector focused private equity fund backed by the Qatar Investment Authority (QIA), Qatar’s sovereign wealth fund and Accor, Europe’s largest hospitality group. Kasada is the first large-sized, professionally sponsored and managed hospitality investment platform in Sub-Saharan Africa (SSA). Over the next three years (2021-2024), Kasada plans to build a portfolio of hotels in SSA primarily through the acquisition of existing (brownfield) hotels as well as the development of a smaller number of new (greenfield) hotels. The first phase, implemented over a period of approximately 18 months, will comprise the acquisition, refurbishment, and improvement of up to 20 hotels (or c. 4,000 hotel keys) across six or more SSA countries (comprising operational hotels as well as under-construction greenfield hotels).
Senior debt for Phase 1 will be primarily provided by IFC on IFC’s own account and through syndications. The deployment of IFC’s loans, MIGA’s guarantees, and the Fund’s capital will be structured as sub-projects, each of which will be progressively reviewed by IFC and MIGA, subject to standardized investment criteria and terms.
In addition, MIGA will provide a total coverage of up to €264.7 million (ca.US$268.2 million) to Kasada and its subsidiaries for their equity, quasi-equity and/or shareholder loan investments against the risks of Transfer Restriction (“TR”), Expropriation (“Expro”), and War and Civil Disturbance (“WCD”). The individual sub-projects will be issued for a maximum tenor of up to 15 years and the guaranteed percentage will be up to 90 percent for equity /quasi equity investments and up to 95 percent for shareholder loans. Further details are provided in the Project Briefs for the first and second sub projects:
Kasada Hospitality Fund LP (Senegal)
Kasada Hospitality Fund LP (Cote D Ivore)
Kasada Hospitality Fund LP (Cameroon)
Kasada Hospitality Fund LP (Namibia)
IFC has led in carrying out environmental and social due diligence for the Kasada projects and disclosed the environmental and social review summary (ESRS) and environmental and social action plan (ESAP) for the first sub-project on March 1, 2021. The first sub-project, Project Ayaba/Awale, comprises (i) the acquisition of 8 existing Accor-managed hotels (run under the Pullman, Novotel and Ibis brands) in Abidjan, Cote d’Ivoire (4 hotels); Dakar, Senegal (3 hotels) and Douala, Cameroon (1 hotel); (ii) operating liquidity injections to ensure the functioning of these hotels in the COVID-19 environment and (iii) capital expenditure / improvements to ensure the hotels’ full compliance to Accor standards and to achieve higher operating efficiencies. The second sub-project, Project Wind, comprises (i) the acquisition of the Safari Hotel, Safari Court Hotel and associated conference center located in Windhoek, Namibia. These hotels will be converted to the Accor Ibis Styles and Movenpick brands respectively. The third sub-project, Project Umbrella, comprises of the acquisition of a well-established hotel complex which is currently owned by Golden Jubilee Ltd and operated as Crowne Plaza by IHG. It has been in operation since 2010 in Nairobi, Kenya and comprises of a 206-key hotel complex with an annex which was completed and opened in 2016. The annex includes a commercial office space section. After Kasada’s acquisition Accor will operate the hotel.
MIGA has been asked to provide coverage against the risks of war and civil disturbance, transfer risk, and expropriation for Kasada’s equity investments and shareholder loan, in sub-project Umbrella, for up to 15 years. See the Summary of Proposed Guarantee for further details. |
