Shelter Afrique, a pan-African real estate lender, told Business Day that it has set aside $200 million to invest in the Nigerian property sectors through a three pronged approach that involves financing construction activities in the country and partnering with developers to build affordable housing units.
The lender’s west Africa’s representative, Oumar Diop, said the corporation will work with credible developers ” with strong track records and part of the funds will be disbursed to them to construct affordable housing units on the supply side.”
“On the demand side, we have also identified a pipeline of primary mortgage banks and we are going to extend facilities to those banks for on-lending to potential off-takers,” he added.
Shelter Afrique, which is headquartered in Nairobi, Kenya, finances real estate developments in over 44 African countries by working with both public and private sector players to reduce the housing disparity on the continent.
It was formed by the African Development Bank (AfDB) which is also its largest shareholder. other shareholders in the financier include the African Reinsurance company and the respective African governments.
Diop told Business Day that Shelter Afrique is planning to issue a bond in 2015 in local west African denomination to reduce its dependency on dollars.
“Right now, we are mostly funding the real estate market in US dollars but we have planned to float a bond in the market sometimes in the second quarter of 2015 and we believe that with the local currency in hand we are really going to impact on Nigeria’s real estate market as we have always wanted to do.”
The regional lender raises most of its hard currencies from the international capital market but has moved to offer debt option in local markets that it operates in like Kenya. Demand for affordable housing in Africa’s far outstrips supply.