Pan-African housing development financier Shelter Afrique has entered into a strategic partnership with the World Bank aimed at addressing the affordable housing crisis across the continent.
The World Bank has also extended a Ksh22m (USD200,000) grant to support Shelter Afrique’s capital market program.
“We are pleased that the strategy that was approved by the Board is now bearing the intended fruits through the deliberate creation of appropriate strategic alliances. We applaud the partnership with the World Bank. We would also like to invite other global multilateral financial institutions the opportunity to invest in Shelter Afrique shares so that they can have access to 44 African countries through the window of Shelter Afrique,” newly appointed Shelter Afrique Board Chairman, Dr. Steve Mainda said in a statement sent to newsrooms on Monday.
Commenting on the strategic partnership, Shelter Afrique Chief Executive Andrew Chimphondah said that the company is privileged to have the support of the World Bank.
“This assistance will go a long way in enhancing Shelter Afrique’s institutional, operational, and technical capacity targeting the reinstatement of our investment-grade credit rating and a strong return to the capital markets. We appreciate the efforts made by Simon Christopher Walley supported by Hadija Kamayo to have succeeded in moving us to this important milestone,” Mr. Chimphondah said.
Mr. Chimphondah said the two institutions were working towards a more long-term partnership with a mix of possible interventions including support for Member Countries equity injections via country IDA allocation; direct lines of credit from World Bank, as well as credit guarantee schemes that will enable Shelter Afrique return to the capital markets.
The Chief Executive said the majority of African countries were already facing a housing crisis as a result of high population growth, increased urbanization, poor urban planning, dysfunctional land markets, rising construction costs, proliferation of informal settlements, and underdeveloped financial systems.
Research from our Centre of Excellence (CoE) shows that the overall shortage of housing in Africa is estimated at 56 million housing units. Out of this, more than 90% are in the affordable housing bracket.
“The solution lies in a well-coordinated and collaborative effort among all stakeholders, including governments, multilateral institutions, non-profit organizations, and the private sector. We believe that this partnership with the World Bank will deepen our impact on Kenya’s affordable housing value chain, in particular, the supply side and subsequently help to bring down the housing deficit in the country and Africa as a whole,” Mr. Chimphondah said.
Downgraded Credit Rating
American financial services company Moody’s withdrew the Caa1 credit rating for Shelter Afrique in 2017, nearly a year after it lost its top credit rating following financial turbulence amid claims of mismanagement and embezzlement.