NAIROBI, Kenya Feb 22- Housing Finance has signed an agreement with the East African Development Bank (EADB) to co-finance large-scale projects of over Sh800 million.
The move is a welcome development for Housing Finance, which is barred from lending more than 25 percent of its core capital base of Sh3 billion which translates to Sh750 million.
Housing Finance Managing Director Frank Ireri said the firm would continue to seek partnership arrangements and opportunities with financial institutions as part of its mandate to mobilise additional resources for housing development.
"We have adopted the strategy of co-financing projects so as to raise the finances necessary to undertake sizeable commercial and housing projects," Mr Ireri said.
The company is in the process of appraising various large-scale housing projects that have capital investment requirements of up to Sh1.5 billion so as to meet its medium term target of supplying 30,000 housing units annually.
In 2010, Housing Finance managed to raise Sh7 billion through a housing bond with the funds set to be used in increasing its mortgage lending.
"Gaining access to alternative sources of funding at competitive rates signals a new dawn in Housing Finance’s ability to attract and access long term financing," he said.
EADB Director General Vivienne Apopo said the firms would also collaborate in the area of research and in mobilisation of financial resources to support projects.
"East African Development Bank has adequate resources to support financing of housing in an integrated approach. We welcome initiatives to explore new financial options, including co-financing," Ms Apopo said.
She said the bank would spearhead the establishment of a regional institution with adequate capacity to promote housing development.
"The institution would be dedicated to promoting the development of housing and housing finance in East Africa," she said.
Last year, Housing Finance also signed a co-financing agreement with Shelter-Afrique, a regional housing finance and development institution involved in financing housing and related infrastructure development in Africa.
Under a fully-fledged project finance department, Housing Finance is spearheading concept origination, financial and technical structuring and financing of property acquisition, development and improvement across wide sectors of residential, commercial and industrial use.
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