This is why Nakuru County was chosen to pioneer the affordable housing project
1 months ago, 19 Oct 00:09
Nakuru County has most of the critical infrastructure needed for the construction of affordable housing units, the World Bank has said.
The global lender selected the county as the pioneer for the realisation of President Uhuru Kenyatta’s ambition to build half a million houses by 2022.
The National Government contracted the Washington-based institution to come up with a road-map that would lead to President Kenyatta’s legacy project.
The houses in Nakuru will be built on a 50 acre-land along Nairobi-Nakuru Highway. World Bank’s Financial Sector Specialist Hadija Kamayo said yesterday that, besides its proximity to the road, the area also has energy, water and sanitation, schools and health centres.
“Naivasha is the hot-spot of the many development activities happening right now,” said Ms Kamayo.
This, she noted, is due to the dualling of the Nairobi-Nakuru Highway, the extension of the standard gauge railway, mega industrial park being developed by the Ministry of Industrialisation as well as Kengen’s decision to establish a business park in the county.
The entire project will cost around Sh5 billion, but construction will be done in phases to allow the participation of local developers. “The Naivasha community can only do between 200 and 300 units. The 50 acres can do 3,000 units,” said Kamayo.
She was speaking during the 5th meeting of the Kenya Pension Funds Investment Consortium which brings together 12 pension funds.
With a kitty of Sh200 billion, the consortium wants to diversify into alternative investments including infrastructure and real estate such as the housing project in Nakuru County.
“We are looking at investing in infrastructure in particular,” said Sundeep Raichura, the head of the consortium and also the group chief executive for Zamara.
“We are engaging with Government and stakeholders on how to make some of the investments more attractive to pension funds by removing or reducing some of these risks as well as the type of financial instruments that could be created to make it easier to access these asset classes,” added Raichura.
Besides low-cost housing, President Kenyatta wants to achieve 100 per cent food security and nutrition, access to critical health services by every Kenyan, and create jobs by boosting manufacturing.
The Nakuru housing programme will be done through a special-purpose vehicle with the county government which donated the land, having a preferential shareholding.
The dividends accrued to Nakuru County Government will be ploughed back into the programme, either by buying new land or servicing existing ones thus ensuring sustainability.
“What we are telling the county government is to protect this money in some kind of escrow account,” explained Kamayo.
Laikipia will be the second county, with piloting already being undertaken on 15 acres of land in Nanyuki. Over 23 counties have already been earmarked for the affordable housing project with each expected to build at least 2,000 housing units each.
Kamayo said that the Government has also reduced the cost burden for the private sector as they don’t have to purchase the land.
Category: business news