Mara Delta grabs 45% stake in three Mauritian hotels

Mara Delta entered into negotiations with New Mauritius Hotels Limited for acquisition of 45 pct interest in entity owning 3 hotel assets in Mauritius

Mara Delta, the pan-African property fund, is set to obtain exposure to three hotels in Mauritius with triple net eurodenominated leases, as it looks to provide strong consistent dividends for its investors.

Mauritian hotel manager New Mauritius Hotels, trading as Beachcomber Hotels, will own 55% and Mara Delta will own 45% of an entity that will hold the hotels.

New Mauritius is one of the 10 largest listed companies on the Stock Exchange of Mauritius.

“The deal will bring our exposure to Mauritius to 24%. It is exciting for us, as it includes a parent company guarantee, which gives us security. The leases are also 15-year eurodenominated leases and the assets have been acquired at a euro property yield just under 8%. This is while we are financing the deal at about 3.75% from a Mauritian bank,” said Mara Delta CEO Bronwyn Corbett.

She said she expected to receive annual escalations of between 1% and 2% on the leases. “There are various kickers here which make the deal attractive. We feel we offer investors exciting exposure to African assets. Those funds which are investing in Europe are not receiving the same kind of escalations, for example,” Corbett said.

She said the company would release more details about the value of the hotels in a few weeks’ time. The company would try to raise money for the deal through the Mauritianstock exchange.

Mara Delta, which is based in Mauritius, earlier in October concluded its first hospitality deal, acquiring the Tamassa Resort, located in Bel Ombre on the southwestern coast of Mauritius, through a sale and leaseback agreement.

Mara started out with two properties in 2014: a 30,879m² shopping centre in Morocco and an office block in Mozambique.

Mara now has interests in assets in Mozambique, Morocco, Mauritius, Zambia and Kenya. Following the Tamassa deal, this portfolio of largely retail properties will include interests in assets worth more than $400m.

Mara intends to list its Moroccan assets separately in the near future. It wants to convert its Moroccan subsidiary into a Reit by the end of 2016, as it looks to gain from tax savings created by the dispensation.