IFC, a member of the World Bank Group, and the National Housing Finance Corporation of South Africa have announced investments of more than US$63 million in International Housing Solutions’ IHS Fund II, which will support the development of affordable housing in South Africa and sub-Saharan Africa.

The commitments, which include US$25 million from IFC, come as IHS, a global private equity investor, prepares to expand its footprint across Africa following the success of its first South African Workforce Housing Fund.

The South African National Housing Finance Corporation is a development finance institution established by the South African government to fund and facilitate the development of affordable housing

Saleem Karimjee, IFC senior manager for Southern Africa, says, “Providing affordable basic services, such as access to quality housing, is a priority for IFC in Africa. The IHS Fund II offers an attractive opportunity for private investors to gain access to a fast-growing market with significant positive social impact. IFC’s commitment will stimulate investment, growth, and job creation in sub-Saharan Africa, demonstrating our support that can help catalyse additional fundraising.”

NHFC CEO, Samson Moraba, states, “Our goal is to enhance the well-being and quality of life of low- to- middle income households with the security of a home, and opportunity to create wealth. We firmly believe that our strategic partnership with IHS will unlock the delivery of housing at scale, and ultimately lead to the creation of sustainable and attractive communities.”

Soula Proxenos, IHS Managing Partner, reports, “IHS has already provided financing for over 28 000 housing units with a combined total value of more than R 8.6 billion, providing tangible positive social impact for the people living in IHS developments. We can substantially expand that impact though the HIS Fund II.” IHS Fund II expects to secure more than $300 million in funding commitments.

IHS’s first fund, SAWHF, has committed over US$230 million (R 2.3 billion) to providing affordable housing in emerging markets while generating superior risk-adjusted returns. IHS’s investments in housing have more than doubled investors’ capital through these projects, encouraging a range of South African and international investors to look more closely at this often ignored segment of the market.

IHS Fund II will consist of two sleeves: one that will invest in the Republic of South Africa and another that will invest in Ghana, and possibly other target markets under the right conditions. Markets under consideration include Zambia, Botswana, Namibia, and Mauritius.