A real estate development firm, Pentagon Real Estate Investment Limited, has been granted a loan of $5 million by the Kenya-based Shelter Afrique for housing development in Nigeria.
Specifically, the loan is meant to co-finance the construction of 55 different types of houses and 160 serviced plots in the phase I of the Mainland Park Estate and the infrastructure services in Lagos.
The loan represents about 56 per cent of the total project cost estimated at $8,971,925, with Pentagon contributing $3,971,925 or 44 per cent of the cost.
Shelter Afrique was established in 1982 by African governments, ADB, Africa-Reinsurance and CDC with the mandate of mobilizing resources for housing development in Africa, and commenced operations in 1985. It was created to mobilize capital from which loan and equity resources can be made available to national housing development institutions in Africa for approved schemes.
The Pentagon loan is part of four loans package approved by the Board of Directors of Shelter Afrique, totalling $17,093,333 to co-finance both residential and commercial projects in three member countries of Shelter Afrique.
The loans are advanced directly to developers in Kenya, Tanzania and Nigeria for middle-income housing and commercial real estate, adding some 309 housing units to the housing stock in the process while over 2,000 jobs will be created during and after construction and small businesses and suppliers supported. Lack of serviced plots has impacted negatively on housing delivery in Nigeria as developers have to bear all the development costs and pass them on to home buyers.
In addition to generating income for the developer and creating employment, the project is expected to provide a contribution to decent accommodation to families in Lagos and Ogun states as well as providing investment opportunities to investors.