A Memorandum of Understanding (MoU) was signed between local and international players in the housing sector to construct housing units worth US $200m in Kigali Rwanda with the aim of addressing the shortage of accommodation in the country.
The MoU signed between China’s Broad Homes Industrial International, Development Bank of Rwanda, Rwanda Social Security Board, BSMART Technology and the International Finance Cooperation (IFC) will see the first phase of the project developing 1750 housing units.
Alternative financing to homeowners
Karin Finkelston, IFC’s Vice President for Partnerships, Communication and Outreach, said that the deal will also offer alternative financing to homeowners who often rely on expensive commercial bank loans to construct houses.
The housing project which is also a deal of World Bank Groups is expected to benefit nearly 50,000 people in terms of employment and business opportunities and will also encourage commercial investment in the housing sector through its recently created International Development Associations.
Demand for housing units
According to Bo Huang the vice president of Broad Homes, the project will address challenges that have previously hindered their entrance into the market. “With the limited financial resources, we have previously not been able to make the most opportunities such as housing debit in Rwanda.”
Broad Homes is one of the largest private players in the Chinese Precast concrete construction sector. Jonathan Gatera, the Director General of Rwanda Social Security Board, said that the MOU is a culmination of one year of negotiations with IFC, which seeks to diversify the role of the private sector in the housing sector.
The investment is against an estimated demand of 31,000 housing units annually, to ensure city dwellers have access to quality shelter.