A sustainable foundation for affordable housing in West Africa is being built through a FCFA60 billion bond issuance.
The pan-African Shelter Afrique Development Bank (ShafDB) is headlining the sustainable bond, whose anchor investors include the International Finance Corporation and Ecobank, though its Senegal division.
CGF Bourse Dakar is the lead arranger, reports Africa Business Communities.
ShafDB, based in Nairobi Kenya, promotes and finances housing, urban development and related infrastructure.
The bond, to be launched in two tranches over October, will finance affordable housing across the West African Economic and Monetary Union (Waemu) region.
The issuance comprises a five-year tranche at 6.10% and a seven-year tranche at 6.30%, according to Dealroom.co.
The bond comes at a time when West Africa’s housing faces a deficit of around 3.5 million units, meaning houses would have to be built at a rate of an additional 250 000 units a year.
‘Our ambition is not simply to raise capital, but to build a more diversified and resilient financing platform for housing and urban development across Africa,’ says ShafDB director of treasury Nabil Mahfoudh. ‘Deepening our presence in West African capital markets, allows us to connect local savings with urgent development needs within the region and to deploy financing in the same currency that local developers earn their income.’
The proceeds of the bond will go towards building affordable, sustainable and energy-efficient housing, while financing in the local currency is intended to reduce borrowers’ exposure to foreign-exchange risk.
