- Shelter Afrique said this week that Kingspride Properties, the developer of the project, had failed to comply with the lender’s funding standards.
- The suspension of financing left the completion of the project in limbo, and homebuyers who had committed deposits in off-plan purchase contracts were showing losses.
Pan-African housing financier Shelter Afrique has suspended a 550 million shillings loan to a Nairobi-based developer for a 240-apartment residential development in Ruaka, Kiambu County, leaving buyers worried about the future of the project .
Shelter Afrique said this week that Kingspride Properties, the developer of the project, had failed to comply with the lender’s funding standards.
The suspension of financing left the completion of the project in limbo, and homebuyers who had committed deposits in off-plan purchase contracts were showing losses.
“Shelter-Afrique, as a responsible lender, only grants loans on very strict conditions and if any of these conditions is not met or satisfactorily met, the loans are refused,” said Shelter Afrique in response to questions from the Business Daily.
“This is in line with international lending standards to which we adhere strictly as an institution. “
The planned development, dubbed Glenwood Gardens, comprises a mix of two and three bedroom units with a unit cost starting at 5.5 million shillings. It was initially scheduled to be completed in July 2017, after being inaugurated in early 2016.
Kingspride Properties President and CEO David Karau has linked the project delay to the cancellation of the debt financing deal.
“We had a challenge with Shelter Afrique, but we have identified and agreed with another financier and are in the process of formalizing the same,” he told the Daily businesswithout disclosing further details about the new financier.
Shelter Afrique had said the project would support affordable housing plans under the partnership with Kings Pride for a total of 2.6 billion shillings in projects in Ruaka and Kiambu for 440 units.
Among these projects was the Glenwood Gardens project, which was to represent 240 units.
The real estate market has, however, experienced difficulties in recent years due to the difficulties of developers in disposing of new units in a context of excess supply of commercial and residential space.
These struggles have been compounded over the past year by the Covid-19 pandemic, which has caused job losses, defaults and reduced income, leading to lower demand in the retail market. real estate.