The firm is targeting to raise a total of Sh8 billion in two bond issues.
The first tranche offered fixed and floating rate notes and saw institutional investors snapping 62percent of the notes while banks and retails; insurance companies received 26percent and 12percent respectively.
Shelter Afrique Managing Director Alassane Bâ said the oversubscription demonstrates a robust local investor appetite for bonds.
“This is the sixth time Shelter Afrique is tapping into the Kenya debt capital markets and the positive market reception to the bond offering is a clear indication of investor confidence,” Bâ said.
The floating rate notes comprised 15percent of the subscription translating to Sh760million with the remaining 85percent going to fixed rate note subscribers, approximately Sh4.23billion.
CfC Stanbic Bank Limited and SBG Securities Limited were the lead arrangers on the issue.
“The history in the bond market and the growing demand for housing in Kenya has made the company’s bond a compelling investment opportunity for both institutional and individual investors,” CfC Stanbic Bank’s Executive Head of Investment Banking, Anne Aliker noted.
Shelter Afrique plans to develop 10 residential projects with an estimated cost of Sh9billion from the proceeds of the bond notes issued.
“We shall be supporting low cost housing projects to cater for the demand for housing at the lower end of the pyramid. Already we are working with about 2,000 families through the Makau Mashinani project to help them improve their homes. With the Government of Kenya and UN HABITAT, we are about to launch in Mavoko a new scheme for 2,500 slum dwellers,” he added.
The notes are expected to start trading on the Nairobi Securities Exchange (NSE) on October 18, 2013.