Business Hilights
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FG, Kenyan based Shelter Afrique seal mass housing deal valued at N610bn

Though available statistics on previous housing support financing deals with Shelter Afrique in Nigeria has always come with mixed feelings at the time of delivery, the federal Government has signed a Memorandum of Understanding (MoU) with the group to partner with local real estate investors.

According to the understanding, Shelter Afrique will inject fund to be used by members of the Real Estate Developers Association of Nigeria (REDAN) for the supply of about 100,000 housing units in select cities at the cost of N610bn.

A statement issued at the end of the deal indicates that a total of $200m would be used for the construction of about 10,000 houses nationwide on a yearly basis and that the project would be over 10 years, thus making it a total 100,000 housing, units which will gulp $2bn (N610bn at the official exchange rate of N305 to a dollar) for the 10-year period.

During the MoU signing ceremony at the headquarters of the Federal Mortgage Bank of Nigeria in Abuja, the Acting Managing Director/Chief Executive, FMBN, Mr. Richard Esin, stated that the Nigerian housing market did not require anything less than $200m annually over the next 10 years to build considerable number of houses.

Esin stated that the projection was to build about 10,000 housing units annually, adding that over 100,000 jobs would be created across the country through the scheme, stressing that “The $2bn will be used for the construction of mass housing units over a 10-year period and this translates to about $200m annually. So, whatever that gives us every year is what we will take as we make adjustments for inflation, etc”.

“The projection is 10,000 housing units annually, but even if we are able to get 8,000 units annually, I think it is okay. This will be done over the next 10 years and there are other things we are also doing to make sure this exercise is successful.

 “The minimum number of jobs we are looking at through this exercise is about 150,000 jobs across the country.”

Responding, Managing Director/Chief Executive Officer, Shelter Afrique, a company for habitat and housing in Africa, Mr. James Mugerwa, stated that his organisation’s shareholders included 44 African countries and two financial institutions.

He explained that the group provides loans, grants and credits for the development of the environment and the provision of houses for Africans, adding that Nigeria had a deficit of more than 17 million houses.

Mugerwa added that “We will commit and dedicate all the expertise to ensure that good quality houses are delivered, and these will be houses that are energy efficient, environmental friendly and comfortable. Nigeria is our biggest sovereign shareholder and this collaboration is the beginning of many other opportunities”.

In his reaction, the President, REDAN, Mr. Ugochukwu Chime, said the signing of the MoU was a milestone in housing delivery and appreciated the Minister of Power, Works and Housing for making the exercise happen.

Business Hilights recalls that the Minister had before the end of last year assured that government will delivery about 100,000 housing units across the country but did not reveal at that time that the funding will come from outside the country.