· The organization has set a target to collect $350 million, the total amount of arrears of subscription for the next five years
· Shelter Afrique views the renewed interest in its activities and shareholder engagement as a positive sign
Nairobi: May 31, 2019- Shelter Afrique, the Pan African Organisation exclusively dealing with affordable housing in Africa has rallied members of the African caucus at the UN-Habitat General Assembly in Nairobi on affordable housing.
In an address to the Ministers of Housing from Member states on the sideline the 2019 UN Habitat General Assembly held in Nairobi, Kenya, Shelter Afrique’s Chief Executive Officer Andrew Chimphondah stressed the importance of affordable housing to the 44-member countries.
Shelter Afrique has placed large-scale development at the center of its 2019-2023 strategy. One of the key pillars of the strategy is recapitalization for the organization.
“The matter of affordable housing is personal to us all; decent and affordable housing is a human right and we must see it as that. We are happy to announce some member countries have responded to our capital call, however, it is important to note that we have capital subscription arrears on the 2013 Call of USD 98 million and also look into the fresh Call to raise additional USD 252 made in 2017. The cumulative USD 350 million arrears on 2013 & 2017 Capitals is the main challenge for Shelter Afrique to effectively engage financial markets for further funding,” Mr. Chimphondah said.
He said Shelter Afrique was keen on engaging member countries in arrears with agreed annual payment plans and also inviting active existing member countries to increase their shareholding in the organisation.
“We are also keen on inviting new member countries to join as shareholders and our current target countries include Egypt, Angola, Ethiopia, and Mozambique. We are also targeting Non-African countries and institutions such as China, CDC, housing corporations under Class “C” Shares category,” Mr. Chimphondah said.
Mr. Chimphondah said the company was considering both equity and debt options to fund its operations in the next five years of its strategic plan, through direct funding (line of credit), co-financing and bridge finance for working capital lines.
“We are also in the process of identifying active member countries for local currency bonds backed by appropriate starting 2021. Upon restoration of equivalent of Moddy’s Ba1 credit rating, we will also consider tapping into Eurobond market for modest ticket issues of US$300 million on committed project lines,” Mr. Chimphondah explained.
He implored shareholders to support company fund raising strategy through commitment to capital allocations through signing of pledge agreements, inclusion of capital arrears in their respective national budget, and stronger liaison between housing ministries and finance ministries to ensure timely payment of capital arrears and any additional subscription. This meeting with the Africa caucus comes a few weeks ahead of the Annual General Meeting in Morocco where shareholders will be reviewing the progress of the company and focusing on social housing as a matter of policy.
Shelter Afrique is the only pan-African finance institution that exclusively supports the development of the housing and real estate sector in Africa. The company is owned by 44 African Governments, the African Development Bank (AfDB) and the Africa Reinsurance Company.