Shelter Afrique set to raise US$500m for affordable housing projects in Nigeria

NIGERIA – Shelter Afrique, the pan African housing finance and development institution, is planning to raise about N250 billion (US$500m) housing bond next month aimed to address the housing deficit in Nigeria.

The Company is set to commence the road shows with prospective investors in January 2022 and is expected to conclude fundraising by end of February.

Shelter Afrique has embarked on a defined strategy of developing and deepening local capital markets so that access to local currency which is competitively priced can be made available to Nigerian Developers from the Real Estate Developers Association of Nigeria (REDAN), Large Developers and Tier 1 and Tier 2 Banks and Primary Mortgage Lenders,” CEO Mr. Andrew Chimphondah said.

“The significance of this is that Shelter-Afrique will have been successful in dealing with the foreign exchange exposure risks that have crippled many African countries caused by the weakening of local African currencies against hard currencies such as the United States Dollar and the British Pound Sterling.”

In September 2020, the pan African housing development financier received US$9.4 million from Nigeria. The contribution moved Nigeria to become the second largest shareholding in the organisation with 13.27% of the shareholding, behind Kenya with 17.78% and ahead of the AfDB at 12.83%.

“This is a major milestone which is set to propel Nigeria to become the largest shareholder in Shelter-Afrique when the country meets its capital commitment. This is a strong testament of the strong shareholder commitment and support of the Shelter Afrique Board and Management,” Mr Andrew Chimphondah said.

Thanking the Finance Minister Dr. Zainab Shamsuna Ahmed for supporting the Bond Issue by the approvals received on critical waivers from the Ministry of Finance.

Mr. Chimphondah noted that Nigeria was a critical and strategic market for Shelter Afrique, adding that the fund realized from the bond issue will go a long way in address affordable housing shortage in the country, now estimated at 17 Million Units against the continent’s 56 million units.

“As a response to addressing this housing shortage, Shelter Afrique will implement a transformative strategy that will crowd in additional capital funding into the low cost large scale affordable housing market in a commercially viable manner,” Mr. Chimphondah concluded.

Shelter Afrique was created by African governments to address the need for a sustainable housing delivery system and related infrastructure projects on the continent.

Shareholders include 44 African countries, the African Development Bank (AfDB), the African Re-Insurance Corporation, and Fonds de Solidarité Africain (FSA).

At the moment, Kenya is the highest shareholder with 17.78 per cent, followed by Nigeria with 13.27 per cent of the shareholding, and the AfDB with 12.83 per cent.

CEO Business Africa had an interview with the CEO OF Shelter Afrique, Mr Andrew Chimphonda in his office in Nairobi. You can have a read of the article Here.

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