, NAIROBI, Kenya Jan 14 – Real Estate investors with projects over Sh1 billion are set to get easy access to finances after Housing Finance and Shelter Afrique entered into an agreement to co-finance such large projects.
Speaking during the signing of the agreement, Housing Finance Managing Director Frank Ireri said the demand for houses in Kenya has been on the rise creating an opportunity for financial institutions bridge the demand-supply gap in the housing sector.
“The future is very positive as there is a robust demand for housing that requires additional funding sources,” Mr Ireri said.
He reiterated that the economy is poised for strong growth in 2010 and expects the demand for home loans to grow.
Shelter Afrique Managing Director Alassane Ba said the institution seeks partnership arrangements and opportunities with financial institutions as part of its mandate to mobilise additional resources for housing development in Africa.
“Shelter Afrique provides financing for projects relating to housing estates, infrastructure provision through site and services schemes, neighbourhood and housing improvements; commercial projects and construction of student hostels,” Mr Ba said.
The agreement also allows the two institutions to participate in other new initiatives in housing as well as expertise sharing.
Shelter-Afrique is a regional housing finance and development institution currently with projects in about 25 African countries with a capacity to fund large scale projects directly from its own resources or through syndication with its strategic partners.
Shelter Afrique is a major player in the capital market and has implemented over 80 projects with total value of over Sh20 billion, most designed to provide affordable middle-income housing.
Over the next few years Shelter Afrique together with its partners, will commit over Sh20 billion in new projects that will benefit low and middle-income families in the country.
Under a fully fledged Project Finance department comprising a mix of technical, financial and market knowledge capability, 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.
Housing Finance has successfully positioned itself as the main player in the property value chain under an ambitious Property Supply Strategy.
The strategy targeting developers, land owners, professional service providers and construction materials has led to creation of new business in a backward integration of the main mortgage business influencing property development to support the company’s core business of mortgage financing.
It is estimated that 150,000 new and additional housing units are required in the urban areas every year yet only an estimated 35,000 are currently produced annually. In addition, an estimated 300,000 housing units will require to be produced annually to cater for housing demand in the rural areas.