New Hilton Garden Inn in Namibia gets financial boost

(Hilton Garden Inn)

Vantage Capital, Africa’s largest mezzanine fund manager, has provided a debenture facility of ₦$80 million to United Africa Group, a hospitality and property-owning group based in Namibia. The funding is being used to support the group’s equity contribution for the construction of a new Hilton Garden Inn, a 181-room hotel to be located in the Windhoek city center on Freedom Square, next to UAG’s existing five-star Hilton Windhoek Hotel.

UAG is one of the largest property-owning and hospitality groups in Namibia, with ten existing hotels in its portfolio (nine operated by Protea and one by Hilton).

Growing tourism demand in Namibia has been a key driver behind the hotel construction project. Tourist arrivals to Namibia have shown consistent growth over the past five years and the trend is expected to continue going forward, with tourist arrivals projected to double over the next ten years. The Namibian Government has identified tourism as one of the economy’s key growth sectors over the next decade. 

The Hilton Garden Inn forms part of the broader Freedom Square development that is being undertaken by UAG. It is one of the few remaining undeveloped sites in the Windhoek city center. 

David Kornik, associate partner at Vantage Capital, said that his company wants the projects it funds “to facilitate expansion and economic development; in this investment we are therefore proud to be supporting a local business group, in a project that will have a significantly positive impact on tourism growth as well as on the development of Windhoek’s city center.”

The United Africa Group investment is Vantage Capital’s third transaction in Fund III, which is targeting a final close of US$260 million , and has a 60 percent  allocation to countries outside South Africa. After supporting the Servest buyout last year, Vantage’s Fund III recently concluded a $20 million investment in a Nigerian property group, Landmark. The Fund is expecting to close its fourth transaction during the first half of 2016 for an investment of over $17 million (R250m).