KENYA – Jubilee Holdings, a financial service holding company, has bought Coca-Cola East Africa’s former head office in Nairobi’s Upper Hill at a cost of KSh1.1 billion (US$9.55m), with the insurer planning to move its headquarters to the property in September.
Jubilee will lease out part of its current address –Jubilee Insurance House on Wabera Street— which will also continue to house its agents and customer service operations.
Jubilee says the expansion and renovation of the newly acquired property will enable it to accommodate its operations. The upgrade will feature the construction of an amphitheatre.
“We bought the Coca-Cola building at a cost of KSh1.1 billion. We got a very good deal,” Jubilee Holdings chairman, Nizar Juma, said.
“We are adding one floor and also doing renovations. We expect to move in September.”
Besides the head office, other operating divisions that will migrate to the Upper Hill property include its fund management, life, and health businesses.
The property, which sits on 3.2 acres, had been on the market for more than two years. Coca-Cola announced the sale of the property in July 2019 after moving to a new building in Lavington.
The soft drinks giant at the time said it chose to migrate to a location that is closer to residential areas besides having a working space that is “more open and less formal”.
The transaction expands Jubilee’s investment in the real estate market. Through PDM Holdings Limited, the insurance group has interests in Nairobi’s IPS Building, Nation Centre, and Courtyard. among others.
Long-term real investors have benefited from both rental income and capital appreciation, with the latter source of returns dominating in the past two decades.
Jubilee’s purchase of the property continues the trend of companies leaving Nairobi’s central business district to new head offices in Upper Hill and Westlands. Others that have made similar moves are Sanlam Kenya and the Nairobi Securities Exchange.
The corporate migration has been partly linked to the need to acquire more modern offices, with most properties in the CBD built decades ago.
Jubilee has raised its dividend payout by 55.5 percent to a record KSh1 billion (US$ ) or KSh14 per share for the year ended December after posting strong growth in earnings.
The insurer recorded a 67 percent net profit growth to KSh6.8 billion (US$59.05m) in the review period, helped by investment income and higher net premiums. Investment income rose by KSh4.6 billion (US$39.95m) to KSh15.9 billion (US$138.08m). Net premiums on the other hand increased 8.9 percent to KSh21.9 billion (US$190.19m).
The company also booked substantial gains from the ongoing transactions with Allianz SE.
The Kenya, Uganda, and Burundi transactions have been concluded and the insurer expects to finalise the Tanzania and Mauritius ones later this year.
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