• Friday, June 14, 2024
businessday logo


Shelter Afrique’s $19.5m affordable housing fund seen creating 2,342 jobs

Shelter Afrique approves additional $13m credit line for Mixta Africa

In apparent concern for the widening housing demand-supply gap in Nigeria, Shelter Afrique recently approved $19.5 million (about N8 billion) for affordable housing development in the country.

The PAN-African housing development financier’s facility, which was approved for Mixta Real Estate Plc, is expected to directly impact more than 1,171 families.

The facility is also expected to provide accommodation for more than 4,684 people and create, at least, 2,342 jobs.

Mixta Real Estate Plc is a Pan-African real estate development company with headquarters in Nigeria. It was established in 2005 and, since then, has successfully executed many impactful projects.

The company is currently present in eight countries across Africa with full operations in Nigeria, Senegal, Côte d’Ivoire, Morocco, and Tunisia but with projects in Mauritania, Algeria and Egypt.

According to officials of the real estate firm, the Shelter Afrique facility would run for seven years with a 24-month moratorium.

The officials explained that the facility has been structured to co-finance Mixta’s affordable residential projects investments and for debt refinancing.

Benson Ajayi, Mixta Africa’s Executive Director and Chief Financial Officer, explained that about $9.75 (₦N4 billion) of the facility would be used to co –finance 1,171 affordable housing units comprising on-going Beechwood Park project (187 units) and New Marula projects (984 units).

“The other $9.75 (₦N4 billion) will be used to repay part of Mixta’s seven-months commercial papers raised from the capital market in a bid to reduce the aggregate commercial papers outstanding from ₦ N17.9 billion to ₦N13.9 billion,” Ajayi added.

Read also: FSDH Capital leads Shelter Afrique’s N46bn Bond issuance

He noted that the funding from Shelter Afrique was a validation of Mixta Africa’s housing and infrastructure development credentials, adding that they were pleased to receive this funding approval after a rigorous due diligence process.

“In addition to accelerating the delivery of sustainable and affordable housing, the transaction will also strengthen our funding status,” he enthused, pointing out that the company was delighted with the support of the organisation and looked forward to working with Shelter Afrique to deliver on its affordable housing mandate across Africa.

On its part, Shelter Afrique noted that the deal with Mixta Real Estate was appealing to them, explaining that, in addition to addressing the development of affordable houses, the deal would also stimulate rapid growth in housing provision.

“The deal will also re-invigorates development of the mortgage industry, as well as incorporate a sustainable development finance solution that makes the sector attractive to financiers,” Kingsley Muwowo, Shelter Afrique’s Acting Managing Director, said.

Shelter Afrique and Mixta Africa are not new to each other in terms of giving and obtaining loan facilities respectively. They have long standing relationship that dates back to 2014 when the Company extended $6 million to Mixta to co-finance the development of 13 blocks, comprising 130 apartments and related infrastructures services for outright sale to the public. “The project was successfully completed and the loan full paid back,” Muwowo recalled.

In March 2021, Shelter Afrique Board of Directors approved a corporate loan in form of line of credit of $13 million in favour of Mixta. The five- year facility was to be on-lent to Mixta’s Real Estate Development affiliates to fund the Group’s current real estate portfolio consisting of three key housing development programmes of 889 low to middle housing units in Morocco (371 units), in Senegal (162 units) and in Ivory Coast (356 housing units).

“We are jointly reviewing a few terms and conditions of this facility at the moment and loan agreements between the two parties, is expected, will be signed soon,” Muwowo said.