Funding new student accommodation – UKZN

INCA project team: Mike Loverock – Head Asset Generation Faried Manuel – Portfolio Manager Johan van Huyssteen – Legal Specialist Karabo Matentji – Credit Analyst

The University of KwaZulu-Natal (UKZN) came about as a result of an amalgamation of the University of Durban Westville and the University of Natal. This institution of learning has approximate 43 000 registered students, of which less than 15% or 6 500 are residents at the University.

The Public Investment Corporation (PIC) won an open tender to provide a 1600-bed student accommodation facility to UKZN at its Durban-Westville campus, on along-term lease basis, funded by INCA as part of its property investment focus.

A development finance facility was provided for the construction of the student accommodation, on land UKZN owned. The PIC/INCA/Crowie Projects consortium is currently busy with the project. After completion, targeted for February 2008, the complex will be leased by UKZN over a 20-year period.

Part of INCA’s financial exposure will be sold to Futuregrowth as soon as the project is completed.

Financial snapshot
Development facility: R129 million.
Long-term loan: R156 million.
Term: 20 years.
Interest rate: 10,73%.
Repayment: Capital and interest semi-annual in arrears.