Tanzania: Proparco is partnering the development of urban infrastructure
( PROPARCO) - Proparco has granted a USD 12 million loan to Peninsula Plaza, a project company set up to build and operate a mixed-use retail / office complex in Dar es Salam. This project is part of the current boom in infrastructure development in Dar es Salaam and will generate major benefits by enhancing urban infrastructure, structuring the local economy and creating jobs.
This loan will finance the construction and launch of Tanzania’s largest mixed use retail / office complex. Peninsula Plaza’s 30,500 m2 of rental space will house a supermarket, restaurant, stores, services and offices all in the one place – a first in Tanzania! The development is ideally located in the heart of the Msasani Peninsula which is currently totally lacking in this type of infrastructure despite strong demand.
Proparco’s first operation in the commercial real estate sector
As Julien Lefilleur, Head of Corporate Finance, Proparco, explains, “this is Proparco’s first operation in commercial real estate outside of the hotel sector. We are hoping to use this operation to develop and structure Tanzania’s urban infrastructure. Dar es Salam’s commercial infrastructure is lagging behind that of other East African cities: it has five times less urban store space than cities with comparable per capita income such as Nairobi or Kampala". SFI and DEG have also invested in the Peninsula Plaza project.
A key development imperative for the city
This venture will have a significant impact on Dar es Salam’s socio-economic development by supporting major urban infrastructure that will in turn generate jobs and strengthen the local economy. Tanzania is East Africa’s second-largest economy and is currently enjoying a period of sustained growth.
Dar es Salaam, the country’s financial and economic hub, has a population of nearly 5 million and is one of East Africa’s largest cities. It is in the midst of a boom driven by its growing middle classes and increased interest by foreign investors who are beginning to move in. Nevertheless, Dar es Salaam’s infrastructure is in a relatively undeveloped state when compared with neighbouring cities.