Home Afrika, a Kenyan real estate developer facing financial challenges, is selling off properties to settle a restructured loan with I&M Bank.

The company aims to raise Sh79 million by selling six houses in their Mitini Scapes Development project along Kiambu Road and five acres of land at their Lake View Heights development in Kisumu.

This move follows negotiations with I&M Bank and other lenders, including Cooperative Bank and NCBA Bank, to restructure defaulted loans.

Home Afrika successfully negotiated a final settlement of Sh100 million with I&M Bank, with Sh22 million already paid.

The remaining Sh79 million will be covered through asset sales.

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"The outstanding balance of Sh79 million will be repaid in the next financial year from proceeds realised from the sale of six housing units under Mitini Scapes Development Limited and the sale of 5 acres of land under Lake View Heights Limited in Kisumu," Home Afrika stated.

The exact amount borrowed from I&M Bank remains undisclosed, though records show a Sh78.9 million loan in 2023, down from Sh141.3 million in 2022.

These loans were secured by guarantors, including mortgages, debentures, and personal and joint guarantees from the company's directors.

Home Afrika previously attempted to raise funds through a bond issue in 2014 but faced difficulties. Negotiations with other lenders also proved fruitful.

"The management negotiated for full and final settlement of Sh320 million and Sh460.95 million with Cooperative Bank and NCBA Bank Kenya Plc respectively during the year under review," the company reported.

These negotiations significantly reduced financing costs by 37 per cent and lowered overall borrowing by 25 per cent.

However, Home Afrika remains locked in a legal battle with Ecobank over a defaulted loan used to finance the Moru Ridge project.

While Ecobank sought to liquidate the asset, a high court ruling ordered them to repurchase the property at market value.

The company obtained funding from Ecobank and I&M Bank in 2013 for the Moru Ridge and Mitini projects, respectively.

Ecobank is currently seeking to seize the stalled Moru Ridge development due to non-payment of the loan advance.

Home Afrika claims Ecobank failed to find a buyer willing to meet the project's cumulative costs of Sh570 million.