Shelter Afrique said its debut 46 billion bond issuance in Nigeria’s capital market will deliver 1, 100 housing units and create an estimated 5, 000 jobs.
The Managing Director/Chief Executive Officer of Shelter Afrique, Mr Thierno-Habib Hann, stated this in his presentation at the 17th Africa International Housing Show in Abuja.
Mr Hann, who attributed Nigeria’s housing deficit to lack of investment in data to guide policy-making, said the bond was floated as part of efforts to close the deficit.
He said the bond has been oversubscribed to N64.3 billion.
He said, “Shelter Afrique has successfully completed its debut 46 billion (US$110.7 million) series one fixed rate senior unsecured bond issuance in Nigeria’s capital market under its 200 billion (US$481.3 million) bond issuance programme in April 2022.
“The dual tranche bond issuance was 60.7% oversubscribed with the order book peaking at 64.3 billion (US$154.6 million), enabling Shelter Afrique to exercise the ‘green shoe’ option and raise an additional 6 billion (US$14.4 million) more than the original 40 billion plan (US$96.3 million).
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“The bond issuance attracted participation from a diverse range of institutional investors including pension funds, banks, and insurance companies, supported by an AA rating from GCR Ratings and an A+ rating from Agusto & Co.”
“The proceeds from the bond issuance are expected to deliver an estimated 1,100 housing units and create an estimated 5,000 jobs in the country. This is a testament to Shelter Afrique’s commitment to supporting Nigeria to achieve its social and economic development objectives.”
He said the nation’s housing woes are worsened by the land tenure system and land registries and records.
He added that the problem is compounded with low disposable incomes, development risks and ‘diseconomies of scale,’ ‘bank appetite to the sector’ and ‘short tenors’.
He further said the Nigerian housing challenge is bedeviled with “inadequate laws, inadequate foreclosure laws and lack of effective data to guide investments and policy-making.”
He said the country has a large housing deficit due to rapid urbanisation at 53 per cent projected to hit 70 per cent by 2050 following low supply of housing.