CASE STUDY 1
Kenya’s Laikipia district forms part of the wider Ewaso ecosystem, a high-value natural landscape that hosts the country’s second largest elephant population and highest variety of rare species in Kenya.
Despite its formally unprotected status, it is also the only area in Kenya where overall wildlife populations are now increasing – the result of an exciting and dynamic new private sector led conservation movement. Until the late 1990’s most land in Laikipia was managed as livestock ranches. Since then most have migrated to new business models based around wildlife conservation, and Conservation Capital and its principals have been at the heart of virtually all of these transitions.
The Loisaba Wilderness
Our Role: Negotiated a long-term lease over a 61,000-acre cattle ranch that was rebranded as the Loisaba Wilderness. Raised US$ 1.2 million of debt and equity to acquire the existing 1,200-head livestock herd and develop a 14-bed lodge, creating an as asset base which was extended over time to include four other tourism facilities - collectively a further 30 beds, including one facility operated as a joint venture with the neighbouring local community.
Outcomes: Loisaba is now widely regarded as one of Kenya’s premier high-end tourism destinations and integrated wildlife-livestock conservancies. It has developed annual commercial revenue streams of c. US$ 1.5 million per annum and in the 17 years since its creation never needed a single donor dollar. Loisaba was perhaps the first and leading example in East Africa of how to manage a large-scale conservation area in a financially and socially sustainable manner. In 2015 it was purchased by a leading international conservation NGO in a transaction worth c. US$ 10 million.
Ol Pejeta Conservancy
Our Role: In a US$ 21 million transaction, the largest in Kenya’s private sector conservation history at the time, we lead the acquisition of a 95,000 acre commercial livestock operation from Lonrho plc, and its subsequent redevelopment into a formal wildlife conservancy within a pioneering (and since much replicated) hybrid for-profit / not-for-profit corporate structure. Chairing its founder board of directors we oversaw the design and implementation of a 5-year business plan that introduced a range of integrated but non-correlated revenue streams: outsourced tourism concessions (5 different facilities totaling 200 beds); domestic livestock operations (breeding, trading and embryo flushing), selective agriculture and residential property development.
Outcomes: The Ol Pejeta Conservancy is now considered a model modern wildlife conservancy – and is widely used as an international reference for other conservancy development initiatives. It generates revenues of more than US$ 6 million per annum – all at a profit; welcomes more than 60,000 tourist visitors a year (the majority being local Kenya citizens); and is now East Africa’s largest rhino sanctuary. Its diversified commercial model has consistently demonstrated its ability to sustain the kind of economic shocks (e.g. post election violence in 2008, terrorism and Ebola in 2014) that cause so many similar ventures to remain reliant on donor funding. Ol Pejeta was the first conservancy in Africa to be given Green List status by the IUCN in 2014.
Our Role: We planned and lead a divestiture process of the 32,000-acre Borana ranch from a wider agricultural corporation. We designed and implemented a hybrid corporate structure for the new conservancy positioning all conservation management operations within a not-for-profit vehicle while economic exploitation rights vest in a separate for-profit corporation. As part of the wider business plan, we structured three super-premium residential property development concessions whose proceeds were used to capitalise a conservation trust to secure the wider operations of the conservancy. Conservation Capital has been represented at board level since inception.
Outcomes: Borana has quickly become recognised as a key player in Kenya’s private conservancy movement becoming the country’s newest rhino sanctuary in 2013. In economic terms, Borana has developed a thriving tourism brand with three high-end properties operating on the conservancy along with integrated livestock operations and a small conservation agriculture project. The project generates revenues > US$ 1.5 million per annum and is entirely financially self-sustaining. Moreover, as a result of the corporate and financial restructuring done in 2010 it has a uniquely strong balance sheet for a conservation initiative of this type.