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Nelson Gahadza-Senior Business Reporter
Shelter Afrique Development Bank (ShafDB), a pan-African housing financier, has extended US$15 million to CBZ Bank to finance the construction of residential housing units and mortgage origination.
The pan-African institution is solely dedicated to financing and promoting housing, urban, and related infrastructure development across the African continent.
ShafDB operates through a partnership involving 44 African governments, including Zimbabwe, as well as the African Development Bank (AfDB) and the Africa Reinsurance Corporation (Africa-Re).
Speaking at the signing ceremony yesterday, Shelter Afrique chief business officer for investment and advisory services, Mr Gibson Mapfidza, said the facility did not mark a new relationship with CBZ, but the result of relations dating back to 2012 when the institution advanced US$12 million, followed by a further US$8 million in 2014.
“We have confidence in the relationship; that is why we are continuing to build on that relationship. What we have seen in other countries is that you advance a facility but the houses you don’t see them; that is why we are here because CBZ has a track record in terms of financing affordable housing,” he said.
Mr Mapfidza said Shelter Afrique was going through a transformation phase and had classified its products into four verticals.
The first one is called the financial institution group (fig), which focuses on the demand side of housing, where companies advance a line of credit to banks so that they can issue mortgages.
“So mainly it’s around mortgage financing, microfinancing, and in other certain countries we work with Real Estate Investment Trusts (REITS) to advance mortgages.
“Fig is after realising that the traditional view around housing is to say if we focus on the supply side being developers, contractors, they deliver houses that will be absorbed in the market. We are realising that in Africa, for us to resolve the 52 million housing deficit across Africa and the 1,5 million in Zimbabwe, we need to intervene on the demand and supply sides,” said Mr Mapfidza.
He said the second pillar is the Project Financing Group (PFG), which focuses on direct financing to developers, contractors, and also trade financing.
“We are engaging across SADC to finance the import component, as most countries within SADC import finished goods mainly from South Africa. So, our focus is to finance that as trade finance,” he said.
The third vertical pillar is the PPPs, or sovereign funding. He said since the institution was owned by 44 member countries, the African Development Bank (AfDB) and Africa-Re, the member states expect Shelter Afrique as a company they own to also intervene directly with them.
“So we do triple Ps in terms of structuring, mobilising financing, and also put catalytic funding for the project to take off,” he said.
The last vertical, fund management, focuses on offshore investors who want to invest in housing in Africa due to the deficit.
“In Africa we have a huge diaspora market; we also do road shows to capture that market and work with local banks to implement housing projects,” said Mr Mapfidza.
CBZ Holdings Group chief executive officer Mr Lawrence Nyazema said the additional financial infusion would further strengthen CBZ Bank’s position in the housing sector and contribute to its sustained growth and development.
“CBZ Bank has enjoyed an excellent working relationship with Shelter-Afrique Development Bank since 2012, when the Bank signed the first line of credit. We are happy to partner again and look forward to a longer-term relationship,” he said.
He added that the bank’s core focus remained on sourcing much-needed lines of credit to support the productive sectors of the economy, such as the housing sector, and that this would go a long way in easing the liquidity challenges.
According to Mr Nyazema, the US$15 million will be used to deliver 3 000 housing units, and there is a project already ongoing in Ruwa.
“The Ruwa one has already started, and what we need to ensure is to provide the right infrastructure. It is a low to medium housing density, and we do not want to deploy it only in Harare but across the country,” he said.
Engineer Theodius Chinyanga, the permanent secretary for the Ministry of National Housing and Social Amenities, said the US$15 million should go towards the development of new houses to reduce the housing deficit.
“We are appealing to our financial sector because we intend to increase our shareholding from the current 1,6 percent to 5 percent, which will also increase probable amounts that the private sector will access from Shelter Africa,” he said.
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