Workers at a construction site in Ngara. The government is seeking support to build-low cost homes despite legal challenges to the initiative. FILE PHOTO | NMG
Housing ministry received 177 responses from potential investors willing to pump in the Sh2.2 trillion.
The State on Tuesday said it had received initial interest of $22 billion (Sh2.2 trillion) from potential investors toward delivery of affordable housing, even as controversy clouds the scheme.
Housing and Development Principal Secretary Charles Hinga said the ministry received 177 responses from potential investors willing to pump in the Sh2.2 trillion despite the legal and policy headwinds facing the project.
Speaking during an economic forum convened by Commercial Bank of Africa (CBA), Mr Hinga said so far about 9,900 acres of land have been pledged by private developers seeking to partner with government.
“We have had two rounds of calls to invite strategic partners. In terms of expression of interest from financiers, we received offers of $22 billion during the first call,” said Mr Hinga.
“We did due diligence and realised there were some jokers and brokers but even if we get rid of 50 per cent of them, it is still good progress.”
The Government is set to launch Kenya Mortgage Refinance Company on Wednesday, with KCB Bank having a 21 per cent stake alongside seven other lenders.
On Tuesday, CBA Kenya CEO Jeremy Ngunze said the bank is open for partnerships.
“We look forward to partnering with the Government and the private sector on this journey. We are particularly excited about the opportunity to collaborate with KMRC in bringing down the cost of mortgages,” said Mr Ngunze.
The development comes despite court cases and criticism from analysts and groups such as Central Organisation of Trade Unions, Federation of Kenya Employers and Consumer Federation of Kenya.
Institute of Economic Affairs chief executive Kwame Owino on Monday faulted the project, saying the Government did not define the housing problem clearly.
“We have a dual market structure that cannot be solved by a single solution.
We are concerned that you cannot throw money into this kind of investment and get a return,” said Mr Owino.
The CEO of Sycum Solutions, an architectural and construction management consultancy firm, Sylvia Kasanga, said the Government has not had sufficient engagements with the market to satisfy stakeholders on the delivery model of the project.
Mr Hinga, however, noted that lack of trust as well as court process are the biggest challenge to the project.
A court has put off the commencement date pending hearing of a case against the scheme.
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