11th December 2023, Lagos – Housing Solution Fund, a local currency real estate investment trust (REIT) successfully completes its Series 1 issuance under its NGN100 billion Programme.
The Housing Solution Fund is a local currency real estate investment trust (REIT) authorised and registered by the Securities & Exchange Commission of Nigeria with a NGN100billion funding programme. The Fund was established in collaboration with development partners to provide innovative market-based solution to stimulate housing demand and sustainably scale housing supply by investing in affordable and accessible long-dated home loans offered to eligible homebuyers in partnership with participating lending institutions and pre-qualified housing developers in Nigeria.
The Fund is managed by alternative investment management firm, FundCo Capital Managers and co-sponsored by Shelter Afrique, alongside pioneer investments from 4 domestic pension funds and one insurance company.
Nigeria has an estimated population of 213 million. By 2050, the United Nations estimates that 75% of the population will be living in cities; this translates into an annual housing requirement over the coming decades of at least 700,000 units to keep up with growing demand and urban migration. Currently production is estimated to be less than 100,000 units per annum, resulting in an overall accumulated housing deficit of about 26 million units, increasing annually by 900,000 units. The estimated annual cost to bridge the housing gap is put at over NGN21 trillion (USD23.4 billion).
The Housing Solution Fund’s primary objective is to ensure the liquidity, affordability, and accessibility of the home loan market for potential homebuyers. Through active investments in home loans via participating lending banks, the Fund aims to address the challenges posed by Nigeria’s fragmented housing sector. This mandate aligns with its sustainable green housing delivery strategy as the pathway to a balanced built environment through which it aims to pioneer green home loans for the green housing development in Nigeria.
Maurice Okoli, Chief Investment Officer of Housing Solution Fund said: “We are excited to have completed our first series under our programme with a mix of DFI, pension funds and insurance investors. We are confident that our innovative business model will play a pivotal role in increasing the housing stock in the market through strategic collaborations with key partners such as InfraCredit, Shelter Afrique, Nigeria Mortgage Refinance Company and eligible developers. These partnerships are designed not only to enhance the Fund’s impact but also to contribute significantly to alleviating the housing deficit in Nigeria”.
The successful Series 1 issuance was led by Shelter Afrique Development Bank, a well-established pan-African housing development financial institution, alongside domestic pension fund managers and insurance companies, including FCMB Pensions, Fidelity Pensions, Radix Pension, Norrenberger Pensions, Leadway Assurance, among others.
The diverse commitment underscores the industry’s recognition of the Housing Solution Fund’s potential and its critical role in reshaping Nigeria’s housing finance landscape.
Housing Solution Fund’s collaborative funding model seeks to address the fragmentation of housing demand and supply-side activities by ensuring that the demand and supply-side intervention occur in a symbiotic and complementary manner.
On the supply side, eligible developers will access sustainable construction funding from domestic institutional investors and DFIs like Shelter Afrique on the back of guarantees from credit enhancement institutions like InfraCredit thereby creating a strong pipeline of completed housing projects for the Fund. On the demand side, the Fund will identify, evaluate and invest in affordable home loans through participating institutions towards the purchase of their homes, in collaboration with refinancing institutions like the Nigeria Mortgage Refinance Company.
This model creates a replicable and scaleable first of its kind integrated and coordinated structure for addressing a seemingly intractable housing market problem.
Renaissance Securities (Nigeria) Limited acted as the Issuing Housing to the Housing Solution Fund Series 1 Issuance.
For more information, please contact:
Housing Solution Fund
Media Enquiries: info@housingsolutionfund.ng
Phone: +23414545361
About the Housing Solution Fund
The Housing Solution Fund is a local currency real estate investment trust (REIT) authorised and registered by the Securities & Exchange Commission of Nigeria with a NGN100billion funding programme (www.housingsolutionfund.ng). The Fund was established in collaboration with development partners to provide innovative market-based solution to stimulate housing demand and sustainably scale housing supply by investing in affordable and accessible long-dated home loans offered to eligible homebuyers in partnership with participating lending institutions and pre-qualified housing developers in Nigeria.
The Fund is managed by alternative investment management firm, FundCo Capital Managers and co-sponsored by Shelter Afrique, alongside pioneer investments from 4 domestic pension funds and one insurance company.
