STRATEGIES FOR DELIVERING MASS HOUSING PROGRAMMES IN AFRICA - Practical Approaches and Structures PRESENTATION TO THE SHELTER AFRIQUE AND MINISTRY OF HOUSING, TCHAD SYMPOSIUM 11 JUNE 2013 TAFFY ADLER, HOUSING DEVELOPMENT AGENCY, SOUTH AFRICA
Outline • The HDA • Two South African case studies • Brickfields: the largest social housing/ rental project situated in Johannesburg • N2 Gateway Priority Project: the largest government sponsored project situated in Cape Town • Lessons to be learnt from both projects
The Housing Development Agency The HDA was established by an Act of Parliament in 2008 to address the land acquisition and assembly process so as to accelerate housing delivery and human settlement development. The two main objectives of the Agency are to: • Identify, acquire, hold, develop and release well-located land and buildings • Provide project management support and housing development services Details of our work can be found on our website: www.thehda.co.za
Case Study 1: The Brick fields Social Housing Project Before… New Build Brickfields… yesterday Brickfields… today
Case Study 1: The Brick fields Social Housing Project
Case Study 1: The Brickfields Social Housing Programme Brickfields Funding The Brickfields Project of 750 units cost R120 million R 19 million Department of Housing Grant R 6,1 million Subsidies R 2,9 million Poverty Alleviation Fund R 10 million ABSA Equity R 10 million Gauteng Partnership Fund Equity R 14,3 million Gauteng Partnership Preference Shares R 1,5 million Johannesburg Housing Company Equity R 25 million ABSA Loan R 25 million National Housing Finance Corporation Loan R 3 million Anglo American Corporation Loan R 2 million Anglo Gold Loan R 1 million ApexHi Loan R42,5 million Total Private Sector R77,3 million Total Public Sector
JHC pledge of 150 shares Brickfields Funding to DoH as security ABSA pursuant of JHC’s obligations with DoH R25 M AGENT- ABSA each DOH SUBSIDY R50 million Put & Call Options BOND NHFC R6.11 million DOH R19M R 60m R10M ABSA AngloAmerican R3M SPV BHC Guarantee Indemnity ABSA BVI802 R42.59M Gauteng Partnership R10M Anglogold R2M Fund Guarantee NHFC Board of BHC R29.4M JHC R1.5M JHC 2 x JHC 1 x GPF APEXHI 1M R14.3M Gauteng Partnership R120M Preference Shares Property Management Property Development Poverty Agreement Agreement Alleviation Fund JHC JHC 2.9M R135/unit p.m. R1315 per unit BRICKFIELDS Schedule of Priority Repayment: Cost of Debt: 1. ABSA Debt A great Public Private Partnership 1. NHFC – Prime less 2% over 20 years 2. NHFC Debt term subordination for 3 years 647 units, 1000m 2 Retail, 3. Shareholder Equity 2. ABSA – prime less 1% over 10-years 4. Subsidy Parking, crèches etc. 3. BHC considers purchasing term loan R120 MILLION capital investment
Case Study 2: The N2 Presidential Priority Project
Case Study 2: The N2 Presidential Priority Project
Case Study 2: The N2 Presidential Priority Project
Case Study 2: The N2 Presidential Priority Project
Case Study 2: The N2 Presidential Priority Project
Case Study 2: The N2 Presidential Priority Project
N2 Gateway Summary - Financials HSS No Project Description Total Project Total 2013/2014 2013/2014 %2013/2014 % of Total Balance available Approved Expenditure Budget Expenditure Budget Approved on approved up to Spent Budget Budget 31/03/2013 Spent W08030006 Delft Symphony Precinct 141 170 723 137 204 370 3 966 353 0 0.00% 97.19% 3 966 353 1&2 – 1850 T/S (1851) W10060003 Delft TRA 5 & 5.1 68 255 245 54 494 460 7 410 715 0 0.00% 79.84% 13 760 785 Joe Slovo Phase 3 (2639) W08080001 UISP 116 214 718 35 537 306 13 211 220 0 0.00% 30.58% 80 677 412 W08080001 Top Structure 286 633 145 54 809 056 30 839 400 0 0.00% 19.12% 231 824 089 W08080001 Bulk Services 37 819 049 15 693 509 9 000 000 0 0.00% 41.50% 22 125 540 W12030030 Electrical Reticulation 53 827 167 15 912 973 9 000 000 0 0.00% 29.56% 37 914 194 Total 494 494 079 121 952 844 62 050 6208 0 0.00% 24.66% 372 541 235 Boystown W10070005 UISP 132 844 821 54 740 643 49 529 999 0 0.00% 41.21% 78 104 179 W10070005 UISP E.O.T 7 067 272 7 067 272 0 0 0.00% 100.00% 0 W10070005 Top Structure 118 247 375 39 526 072 36 254 324 0 0.00% 30.92% 78 721 303 MIG 20 368 849 13 145 915 7 222 934 0 0.00% 58.34% 7 222 934 Total 278 528 317 60 867 724 93 007 265 0 0.00% 39.24% 164 938 101 TRA 6 (422) 64 555 831 0 30 897 479 0 0.00% 0.00% 64 555 831 Phillipi Upgrade 15 315 200 0 15 315 200 0 0.00% 0.00% 15 315 200 Phillipi TRA (400) 47 977 907 0 28 403 128 0 0.00% 0.00% 47977907 TOTAL N2 GATEWAY 1 110 297 302 428 131 576 241 050 753 0 0.00% 38.56% 682 165 726
Lessons Learnt: One size does not fit all • PPP dependent on the track record , financial and capacity resource of the different parties • PPP will be successful depending on appropriate structuring of the risk and reward profile of project • PPP dependent on the legal and regulatory framework operating in the environment • PPP dependent on the political environment within which the project operates
Lessons learnt: PPP can incorporate different roles for the different parties • Developer • Financier • Project manager • Owner / manager
Lessons learnt: PPP can only ultimately succeed if properly structured for implementation • Planning from land to stand and beyond • Funding appropriate to project and risk • Project management • Post development management
Thank you
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