Nedbank CIB spearheads affordable housing financing for proposed Ekurhuleni Mega-Development
Johannesburg, 2 October 2015 – Massive preparation is underway in Ekurhuleni to facilitate the transformation of the area into Gauteng’s major hub for manufacturing, logistics and transport industries. This preparation includes a mega project for affordable housing developments that is set to reach a significant section of the lower income population and in turn, have a positive impact on Gauteng’s economy.
To make this project possible, the Affordable Housing division at Nedbank Corporate and Investment Banking will finance R85m towards the purchase of 732 hectares of land in the south-west of Ekurhuleni for Cosmopolitan Projects, resulting in phased affordable housing developments over the next seven years. The property will be used to develop a variety of approximately 15 000 high and low density residential units.
Manie Annandale, Head of Affordable Housing at Nedbank Corporate and Investment Banking, says the demand for affordable housing in Gauteng is robust and sustainable. “Gauteng is an economic powerhouse in Africa and we are seeing rising levels of income in the low to middle income bracket. At the same time, the ongoing increase in house prices mean that affordable housing developments such as this will provide reasonable and quality alternatives to renting higher-spec residential units in more centrally located hubs.”
The establishment of formal housing brings positive effects, encouraging the growth of commercial opportunities and act as a catalyst to aid economic development and growth.
Johann Vorster, Director of Cosmopolitan Projects, clarifies: “Research by the Cosmopolitan Projects Group has indicated that there are very few affordable housing developments in the immediate vicinity of the area. The development is therefore very well-timed. Adjacent to Rietspruit and Palm Ridge – two of the three largest and fastest growing suburbs in the area – it is also in close proximity to nodes such as Katlehong, Thokoza, Vosloorus and Alberton. The proposed development will have schools, places of worship and community amenities including a shopping mall, day clinics and smaller retail facilities. It is also within easy reach of a police station and hospital.”
Adds Annandale: “Understanding this growth and comparing it to conditions within the surrounding areas will help clarify how the proposed development complements or competes with that demand. Slow growth in affordable markets is often a result of lack of adequate supply of appropriate housing opportunities or a lack of access to credit, rather than lack of demand or interest.”
“Property Finance at NCIB takes pride in providing agile solutions to the market and as such, we are pleased to be involved with the Ekurhuleni development and take pride in knowing that this will ultimately lead to an improvement in the lives of individuals and the overall enrichment of the province,” concludes Annandale.