Hundreds of families in Nigeria to benefit from first affordable green housing project
… as InfraCredit guarantees N3bn for construction of 370 green housing units in Nasarawa technology village
Oredola Adeola
InfraCredit, an infrastructure credit guarantee institution, has guaranteed NGN3 billion initial debt financing under a NGN12.5 billion Debt Programme for Modern Shelter Systems and Services Limited to construct 370 low emission, cost-efficient green and affordable housing units.
The housing units will be built according to the International Finance Corporation’s green building standard, and the project is part of a plan to develop up to 1,200 EDGE-certified homes in the Technology Village in the state.
This was disclosed by InfraInvest, in a statement obtained by EnergyDay, being the first green housing project to be executed under its Affordable Housing Funding Programme.
EnergyDay gathered that the green housing programme aims to transform the housing ecosystem in Nigeria and to also help the country to upscale its commitment to achieving its net-zero emission and climate change targets.
InfraCredit, a Nigerian infrastructure credit enhancement company, has been involved in supporting green-certified local currency debt issues for off-grid solar and rural electrification projects in Nigeria. The company has provided guarantees for projects such as off-grid solar, solar-powered rural telephony, and solar mini-grid projects in the country.
The green housing project also seeks to address the funding constraints faced by developers resulting from the lack of an institutional mechanism to provide both developers and homebuyers with access to affordable funding required to make both home financing and the final sale predictable and scalable.
The Programme creates an opportunity for cities to turn to green construction, which can spur low-carbon economic growth and create much-needed skilled, green jobs. It is also expected to reduce greenhouse gas (GHG) emissions in homes, hospitals, commercial real estate, warehouses, and airports.
It is being implemented in collaboration with The Private Infrastructure Development Group (PIDG), through InfraCredit’s co-founder GuarantCo under a Technical Assistance (TA) Grant Agreement with InfraCredit which was designed to support InfraCredit’s Programme to help develop a scalable and sustainable approach to improving affordable housing delivery in Nigeria.
InfraCredit in the statement stated that it has a pipeline of affordable housing developers under the Programme that will benefit from technical assistance support and transaction structuring towards a local currency bond issuance and incorporating E&S best practices.
To date, InfraCredit has originated an initial pipeline of EDGE-compliant housing infrastructure projects sized at over NGN70 billion from six (6) housing developers, requiring InfraCredit’s guarantee support for their respective construction debt issuances.
EnergyDay further gathered that the 1,200 EDGE-certified housing units in Nasarawa State, will be developed according to IFC – International Finance Corporation, IFC’s green building standard (EDGE), which helps developers design low-emission, cost-efficient green buildings.
Chinua Azubike, Chief Executive Officer, InfraCredit said, “We are excited with the successful closing of this transaction and the significance of the project in the housing sector, because of our ability to replicate and scale its impact.
“Sustainable green housing delivery is the pathway to a balanced built environment, and with the success of this transaction with Modern Shelter, we have a unique opportunity to work with our development partners in demonstrating innovative financing solutions to transition into new buildings, designed to meet energy efficiency standards, create green jobs and support climate-resilient economic growth.
“The Nasarawa Technology Village project underscores a successful example of public–private partnerships as a mechanism of unlocking climate financing for sustainable development,” Chief Executive Officer, InfraCredit said.
Abdulmalik Mahdi, Managing Director, Modern Shelter said, “Modern Shelter is proud to have emerged as a pioneer adopter of EDGE in 2021 (under a previous project Earth-Point Modern Shelter).
“This recent transaction marks another significant milestone for Modern Shelter, providing us with access to stable, well-structured, long-term funding essential for delivering EDGE-certified affordable housing.
“This achievement owes much to the invaluable support of InfraCredit and Shelter Afrique. In collaboration with ABS Blueprint Limited and the Nasarawa State Government, we are wholeheartedly dedicated to alleviating Nigeria’s housing deficit with an unwavering focus on ensuring the project’s quality and timely completion,” Mahdi said.
Emilio Cattaneo, Head of PIDG TA said, “PIDG is proud of its involvement in this project since early 2021, and to have supported InfraCredit and the Housing Solutions Fund through the provision of a grant facility to finance a number of the critical workstreams of this pioneering initiative.
“The provision of affordable housing, constructed following the highest environmental standards, is fully aligned with PIDG’s mission of promoting the development of critical infrastructure, which is both climate resilient and sustainably constructed, and which addresses the significant funding gap that exists in the sector, by mobilising private capital, “Cattaneo said.
The head of PIDG TA therefore emphasised that his company looks forward to the future rollout and expansion of this programme.
