THE INVESTMENT OPPORTUNITY

Although there are several smaller lodges as well as one larger 80-room luxury hotel in close proximity, our market survey indicates a great opportunity for our planned development.

In the medium  to long-term, business and commercial activities (including conferencing) are bound to increase helped by the Government’s aim to transform Ghana as the West Africa business hub reinforced by its free-zone industrial development.

With the above in mind, Baobab River Ltd. (Reg. CS202392016), the project company was established and registered in Ghana in November 2016. The project promoter and CEO is Kojo Busia, a Ghanaian citizen currently working in an international organization based in Addis Ababa. He has excellent relationships and networks within the local community as well as the Ghanaian authorities.

PROPOSED BUSINESS MODEL

The Lodge will be managed either under a local, existing brand or with the assistance of an international hotel management firm and brand. The Lodge will offer better value-for-money and cutting-edge services to the residents and MICE tourists than the current competition offerings.

The Lodge will be eco-friendly with most of its green energy and water management systems designed to save on operational costs. Even during the construction process costs will be saved with optimal use of locally sourced sustainable construction materials such as timber cladding and stones from the building site, amongst others.

Besides being an eco-friendly facility, the lodge will offer state of the art technologies for its potential customers, including high-speed internet access, fully equipped conference and meeting rooms, business centers and more.

PRIME LOCATION

THE EASTERN AND VOLTA REGIONS

The site is located within a prime resort area. The Volta and Eastern region, where the project site lies, is an area of extraordinary scenic beauty with rolling hills and valleys, rocky outcrops overlooking Lake Volta. The combination of lagoons, rivers and waterfalls make this area one of the most attractive in Ghana.

The Baobab River Lodge project seeks to tap into the rich natural beauty and landscapes as well as the cultural attractions for the benefit of its guests.

ADVANTAGES

  • The 10-ha project site is located in a pristine area of the Eastern Region of Ghana, close to the border with the Volta Region along the River Volta.
  • It is about 80 km from Accra and the international airport (1-hour drive by car) and about 10 km from the Akosombo Dam and the Volta Lake.
  • The relative proximity to Accra will allow the project to tap into the MICE [Meetings, Incentives, Conferences, and Events] tourism market.
  • The site has about 200m of river front.
  • The Lodge is close to the Shai Hills Game Reserve.
  • The project is close to Osukudu which is the site for the proposed site for a 75 MW wind farm in the Shai-Osudoku District in the Greater Accra Region. The Osukudu Wind Farm will contribute to renewable energy generation which will add to the Baobab River Lodge credentials as an eco-lodge if power is sourced from the wind farm.

FEASIBILITY

The Baobab River Lodge, has already undertaken various feasibility studies and land surveys, and has also made headway with regard to securing top resources to ensure the success of the project.  Surveys and studies are available on request.

The Baobab River Ltd. has appointed the following companies:

  1. Hotel Solutions (Ghana) Ltd., a hotel and hospitality-focused consultancy, to develop (a) the market study and (b) the feasibility study. Both studies were completed in June 2016.
  2. AD Property Group (South Africa) as the Architectural, Design, Engineering and Project Management Services firm for project.
  3. Africanext Capital (Pty.) Ltd. (South Africa) as the Finance Advisor for the financing of the project.

The Lodge will be managed either under a local existing management company or preferably by an international hotel management firm.  The project promoter and project advisors are currently looking at various opportunities after having signed letters of intents with two major hotel management companies.

ESTIMATED PROJECT COSTS

The Average building costs (construction plus FF&E-Fixture, Furniture & Equipment) in Ghana has been calculated at US$ 2,506 per m2 for the upmarket 25 room / suite facility and at US$ 1,919 per m2 for the mid-market 75 room accommodation facility (November 2016 estimates).

The total project costs are of a preliminary nature and based on costs per square meter obtained following industry standards and comparable costs within Ghana and West Africa.  The entire project investment cost is estimated to be US$ 21 million.  The Company is seeking the following:

  1. Equity financing of about US$ 7 million; and
  2. Debt financing of about US$ 14 million through a medium-term credit facility.

The equity financing, which could also be accepted as subordinated debt from investors or finance institutions, will allow the project to secure the interest of debt finance providers and/or development finance institutions and bring the project to financial close.