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The company is introducing the Rent To Own concept whereby the prospective home buyers pay a small upfront deposit and proceed to pay a fixed monthly rent for a period not exceeding 15 years towards full ownership.
Introduction
The promoter is a registered construction company incorporated in the Republic of Kenya. The company was established in 2012 and is mostly focused on human development and strives to invest its efforts in projects that go beyond the economic bottom-line. This affordable housing project is a real estate venture being developed by the promoters for the sole purpose of building over 2,000 low cost homes at various sites in Kenya using blocks that are fully interlocking, mortarless and self-aligning. The land earmarked for the construction of the houses is situated at various sites in Kenya including Nairobi, Mombasa, Nakuru, Naivasha, Machakos, Eldoret and Kajiado. The first project for the construction of 150 units will kick start in Machakos County on a 10 acre land designated and approved for the project by virtue of a MoU and sale agreement with the landowner.
Advanced building solutions
The promoter envisions the development of affordable homes using advanced building solutions in order to achieve reduced unit costs, flexible payment options and to incorporate environmentally sustainable utility services including business/work environments, recreation facilities and public utility facilities. The project has an estimated term period of three (3) years with a construction sales period of six (6) months. Sales are projected to be at US$32,500,000 with a net profit of US$11,250,000 after tax deductions.
Introduction
The promoter is a registered construction company incorporated in the Republic of Kenya. The company was established in 2012 and is mostly focused on human development and strives to invest its efforts in projects that go beyond the economic bottom-line. This affordable housing project is a real estate venture being developed by the promoters for the sole purpose of building over 2,000 low cost homes at various sites in Kenya using blocks that are fully interlocking, mortarless and self-aligning. The land earmarked for the construction of the houses is situated at various sites in Kenya including Nairobi, Mombasa, Nakuru, Naivasha, Machakos, Eldoret and Kajiado. The first project for the construction of 150 units will kick start in Machakos County on a 10 acre land designated and approved for the project by virtue of a MoU and sale agreement with the landowner.
Advanced building solutions
The promoter envisions the development of affordable homes using advanced building solutions in order to achieve reduced unit costs, flexible payment options and to incorporate environmentally sustainable utility services including business/work environments, recreation facilities and public utility facilities. The project has an estimated term period of three (3) years with a construction sales period of six (6) months. Sales are projected to be at US$32,500,000 with a net profit of US$11,250,000 after tax deductions.
Product summary
The proposed 2,000 affordable homes will be apportioned as follows; 1000 units will be equipped with 2 bedrooms whilst the remaining units will be equipped with 3 bedrooms. The houses are designed to provide a living experience that installs the beauty of communal and modern living and has the following schedule of products:
Smart shuttle services: This shuttle has been designated to serve as the primary source of transport for the residents within the estate when they go to work and when they return from work. The promoter is talking to a couple of motor vehicle companies to procure the luxury shuttles.
Waste management: The promoters will develop an advanced waste management system for each site. The incinerator plant is capable to dispose of more than one (1) tonne of waste per hour. It also has the capacity to generate sufficient heat for heating the water to be used in the estate at a token fee dependent on the waste that will be delivered. The promoters have also included a disposal truck to maintain the integrity and green status of the project concept. This initiative would certainly elevate the status of this project to a socially impactful endeavor.
Common Areas: Recreational areas have been planned which are rare in social or private housing schemes in Kenya. It is a huge necessity and selling point in real estate development, and so they intend to dedicate a substantial amount of the proposed land to green areas, a huge central park and other social facilities.
Water Conservation: The promoters intend to construct a rainwater collection systems being capable to conserve the rainwater being assembled during the wet season so it can be used during the dry season.
Security: The promoter's goal is to create a safe environment for residents by providing adequate security systems (e.g. CCTV, home intrusion alarms, etc) to enhanced the ability of the estate security personnel.
Product summary
The proposed 2,000 affordable homes will be apportioned as follows; 1000 units will be equipped with 2 bedrooms whilst the remaining units will be equipped with 3 bedrooms. The houses are designed to provide a living experience that installs the beauty of communal and modern living and has the following schedule of products:
Smart shuttle services: This shuttle has been designated to serve as the primary source of transport for the residents within the estate when they go to work and when they return from work. The promoter is talking to a couple of motor vehicle companies to procure the luxury shuttles.
Waste management: The promoters will develop an advanced waste management system for each site. The incinerator plant is capable to dispose of more than one (1) tonne of waste per hour. It also has the capacity to generate sufficient heat for heating the water to be used in the estate at a token fee dependent on the waste that will be delivered. The promoters have also included a disposal truck to maintain the integrity and green status of the project concept. This initiative would certainly elevate the status of this project to a socially impactful endeavor.
Common Areas: Recreational areas have been planned which are rare in social or private housing schemes in Kenya. It is a huge necessity and selling point in real estate development, and so they intend to dedicate a substantial amount of the proposed land to green areas, a huge central park and other social facilities.
Water Conservation: The promoters intend to construct a rainwater collection systems being capable to conserve the rainwater being assembled during the wet season so it can be used during the dry season.
Security: The promoter's goal is to create a safe environment for residents by providing adequate security systems (e.g. CCTV, home intrusion alarms, etc) to enhanced the ability of the estate security personnel.
Market
The market need for this proposed project is anchored on the demand-gap that one finds in most sub Saharan African capitals for well-planned and well-integrated small cities where a community comprising of the fast expanding middle-class and [to some extent] high-income segments of the society can thrive in a privately governed environment; and where the less-fortunate can as well offer unskilled/skilled labour towards their betterment. In the particular case for greater Nairobi and other towns, there has been a noted demand-gap and outright inclination within the middle income group towards shelter that is offered within:
Sales strategy and Rent-to-Own concept
The promoter’s main target is to sell the homes through the established bank and cooperatives Societies where the buyers can obtain lower interest loan/mortgages. The proposers have managed to discuss with the Savings and Credit Societies (SACCOS) who have thousands of members or middle income earners who are looking for properties ranging; US$15 000, to US$17 500 two and three bedrooms respectively.
The promoters also seek to bridge this housing deficit by introducing a more robust approach to mortgage financing for the buyers, while seeking new frontiers in raising construction capital through innovation. The company is introducing the Rent-to-Own concept whereby the prospective home buyers pay a small upfront deposit and proceed to pay a fixed monthly rent for a period not exceeding 15 years towards full ownership.
Management
The management of the project has ample experience in developing projects that will always aim at being as fully integrated as is practically possible where the end-users can live and enjoy seamlessly. The project developers have acquired useful real estate development experience through the construction of more than 60 rental houses in Naivasha and currently developing 100 low-cost houses for sale. The uptake of the houses has been quite fast and the model employed in the project was built for a client, where all houses are pre-sold to mitigate on marketing risks. In Nairobi the developer is dealing in the property industry through land subdivision/sale and the supply of building materials to construction sites.
Current status of the project
The parcel of land has been reserved for the promoters for the purpose of implementing the proposed project and the total mutually agreed-on purchase price is as included in the proposed project’s financials. The promoters have also formed strategic alliances through partnerships with various stakeholders including;
Development strategy
The promoter’s approach to affordable real estate development in Kenya is to execute notable and transformational real estate projects in areas that are currently perhaps not considered the most prime but which they reckon to be where near-future growth will be most sustainable and financially rewarding. The promoter also looks to implement a structure whereby end-user finance is affordable to buyers by seeking re-financiers that will offer below-the-market-rates mortgages therefore making their conveyable products affordable to many and additionally actualizing one of Kenya’s Vision 2030 goals for affordable housing.
The funding of this project can be set up in phases after which various other investors are willing to join the project. The promoters require some US$20,000,000 to fully implement with the interest capitalized so as to be settled from the sales income. Appropriately priced long-term end-user finance is a key issue that the promoters would appreciate to have explored. If available, it would dramatically improve the project’s competitiveness, and therefore viability.
Market
The market need for this proposed project is anchored on the demand-gap that one finds in most sub Saharan African capitals for well-planned and well-integrated small cities where a community comprising of the fast expanding middle-class and [to some extent] high-income segments of the society can thrive in a privately governed environment; and where the less-fortunate can as well offer unskilled/skilled labour towards their betterment. In the particular case for greater Nairobi and other towns, there has been a noted demand-gap and outright inclination within the middle income group towards shelter that is offered within:
- Well-planned gated communities situated away from the hustle and bustle of Nairobi city and yet within easy reach of the same.
- Well-integrated and secure gated communities where the residents can live, work, shop and play.
- A well-landscaped and conducive environment.
Sales strategy and Rent-to-Own concept
The promoter’s main target is to sell the homes through the established bank and cooperatives Societies where the buyers can obtain lower interest loan/mortgages. The proposers have managed to discuss with the Savings and Credit Societies (SACCOS) who have thousands of members or middle income earners who are looking for properties ranging; US$15 000, to US$17 500 two and three bedrooms respectively.
The promoters also seek to bridge this housing deficit by introducing a more robust approach to mortgage financing for the buyers, while seeking new frontiers in raising construction capital through innovation. The company is introducing the Rent-to-Own concept whereby the prospective home buyers pay a small upfront deposit and proceed to pay a fixed monthly rent for a period not exceeding 15 years towards full ownership.
Management
The management of the project has ample experience in developing projects that will always aim at being as fully integrated as is practically possible where the end-users can live and enjoy seamlessly. The project developers have acquired useful real estate development experience through the construction of more than 60 rental houses in Naivasha and currently developing 100 low-cost houses for sale. The uptake of the houses has been quite fast and the model employed in the project was built for a client, where all houses are pre-sold to mitigate on marketing risks. In Nairobi the developer is dealing in the property industry through land subdivision/sale and the supply of building materials to construction sites.
Current status of the project
The parcel of land has been reserved for the promoters for the purpose of implementing the proposed project and the total mutually agreed-on purchase price is as included in the proposed project’s financials. The promoters have also formed strategic alliances through partnerships with various stakeholders including;
- National housing Finance
- Cooperative Societies
- A Chinese housing solutions company
- Government of Kenya
Development strategy
The promoter’s approach to affordable real estate development in Kenya is to execute notable and transformational real estate projects in areas that are currently perhaps not considered the most prime but which they reckon to be where near-future growth will be most sustainable and financially rewarding. The promoter also looks to implement a structure whereby end-user finance is affordable to buyers by seeking re-financiers that will offer below-the-market-rates mortgages therefore making their conveyable products affordable to many and additionally actualizing one of Kenya’s Vision 2030 goals for affordable housing.
The funding of this project can be set up in phases after which various other investors are willing to join the project. The promoters require some US$20,000,000 to fully implement with the interest capitalized so as to be settled from the sales income. Appropriately priced long-term end-user finance is a key issue that the promoters would appreciate to have explored. If available, it would dramatically improve the project’s competitiveness, and therefore viability.
Interested? For more information including business plans, please contact:
Office Africa
Kennedy Makimii
nmakimii@firmfactoryafrica.com
+254202448888
Office Europe
Jan Reijer Brons
jrb@firmfactoryafrica.com
+31653354494
Office Africa
Kennedy Makimii
nmakimii@firmfactoryafrica.com
+254202448888
Office Europe
Jan Reijer Brons
jrb@firmfactoryafrica.com
+31653354494