Egyptian firm signs Sh2 billion sports centre deal

Egyptian conglomerate Wadi Degla Holdings became the latest investor in Kenya’s sporting business after it signed a Sh2 billion deal last week.

The sports and clubs investor signed a memorandum of agreement with Home Afrika that will see the firm host a sports academy in Migaa, the real estate developer’s integrated flagship development.

The deal involves investment in a golf course, its management and building of club facilities.

Through a joint venture with English Premier League heavyweights Arsenal, Wadi Degla will also provide professional soccer training in Kenya, among other games, at the proposed Kiambu County facility.

Target market

The academy — which is to be completed within three years — is expected to become a high-profile sporting centre, considering its curriculum and the calibre of trainers anticipated.

“The target market will be educational institutions and individuals identified to have talent. However, the fee [structure] is yet to be finalised,” Home Afrika CEO Njoroge Ng’ang’a said.

The project is expected to find favour with middle to high-income segments given that it is being developed within a golfing residential community.

Home Africa added that the academy would provide badminton, hockey, netball, rugby, squash, tennis and volleyball facilities.

The investment is one of Kenya’s single largest private investments in sports, and comes at a time when major corporates have begun shying away from putting money in the sector over incessant claims of corruption and power struggles.

For instance, Safaricom pulled out rugby sponsorship citing a lack of accountability, and has indicated  it will stay away until the Kenya Rugby Union puts its house in order.

Wadi Degla’s sporting facilities in Egypt support more than 75,000 families, and the partnership with Home Afrika is expected to create some of the best sports talent development facilities in the region. The firm also owns professional soccer clubs in Egypt and Belgium.

“We invest in sporting facilities in Egypt and we have seen these facilities transform regions into cities,” Wadi Degla President Adel Samy said.

Investment recipients

The firm will use a build-and-operate model, and will lease 20 acres to build the club house and sports academy.

The closest facility Kenya has to this planned academy is the Lorna Kiplagat High Altitude Training Camp in Iten, which has had among its students local and international athletics champions.

There is also the Tegla Loroupe Peace Academy, which comprises primary and secondary boarding schools, a sports stadium, athletics training camp, health centre and staff quarters.

Wadi Degla has further committed to developing the remaining nine holes in Migaa’s 18-hole golf course to championship standards at a cost of Sh180 million ($2 million). This will be in addition to the Sh1.8 billion ($20 million) they will use for the club facilities and sports academy.

The Egyptian firm is expected to complete construction of the golf course and club house in eight to 10 months, while the academy will be developed within three years. Construction is expected to begin in a month’s time.

The investment makes golf one of the biggest recipients of investments in the sports sector as high-end real estate projects put up courses to attract buyers.

Kenya is going big on sports facilities and plans to build five national stadiums to lift industry standards and boost  the country’s chances of hosting global events. The stadiums are to be constructed in Kisumu, Mombasa, Nakuru, Eldoret and Garissa.

The Sports ministry has already invited bids from investors to carry out feasibility studies and develop a master plan for architectural designs of the proposed facilities.

Kenya has two national stadiums, both in Nairobi, with a joint capacity of 90,000 people – Moi International Sports Centre (60,000) and Nyayo National Stadium (30,000).

However, investors are still slow in taking up available opportunities in the sector. According to an investment guide prepared by the then Macro Planning Directorate in the Planning ministry, the Government listed the construction of a golf city in Nairobi as a viable investment, but the project is yet to attract a significant investor.

The golf city, which at the time was being championed by the then Office of the Prime Minister, is proposed to be located at Railways Club Nairobi, where 63 acres of land are available. A feasibility study has already been done and shown project viability.

Water sports are another area crying out for investment, with Kenya’s waterways yet to be fully exploited and developed to attract leisure and adventure tourists.

Nurture talent

Sporting academies have also yet to pick up. These centres are structured to identify and nurture talent from a young age through formal training on various modules that mirror the formal education system.

For instance, Argentine and Barcelona superstar Lionel Messi was admitted to the La Masia football academy in 2000. His football talent was spotted when he was just eight years old by Newell’s Old Boys, a soccer club based in Argentina that runs a junior academy.

Locally, only Mathare Youth Sports Association, which is more of a community welfare organisation than a sports academy, has produced a Kenyan professional player — Dennis Oliech.

Kenyan sportsmen and women are often identified in secondary school, years after they have lost some of their talent through the rigours of the academic system.