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South Africa: Eskom Pension Fund Commits R100m for Housing
Source: www.sanews.gov.za
Source Date: Thursday, April 24, 2014
Focus: Electronic and Mobile Government, ICT for MDGs, Knowledge Management in Government, Citizen Engagement, Institution and HR Management, Internet Governance
Country: South Africa
Created: Apr 24, 2014

“We are proud to partner in this endeavour with International Housing Solutions (IHS), which has a proven track record of enabling the building of quality communities while maintaining the highest level of oversight and financial due diligence.

“We are further convinced that this investment will make a substantial positive impact on the lives of hundreds of thousands of pensioners who rely on the Eskom Pension and Provident Fund to remain in healthy shape,” he said.
The Eskom Pension and Provident Fund is the second largest pension fund in the country, and provide retirement, withdrawal and disability benefits to its members.

It also provides death benefits for its in-service members, deferred pensioners and pensioners, which are paid to their qualifying beneficiaries.
The Eskom Pension and Provident Fund’s investment is into IHS Fund II, launched last year in the wake of the unprecedented success of the company’s first fund, the SA Workforce Housing Fund (SAWHF).
The US$230 SAWHF enabled the financing and development of more than 28 000 homes with a combined total value of more than R8.6 billion throughout South Africa.

IHS was the first international institutional investor to recognise the potential of developing affordable housing, also called gap housing, in African markets.
In doing so, it not only opened up a valuable new asset class for investors, but ensured that thousands of families were able to afford a home of their own and start their journey to wealth creation through property ownership.
Managing Partner at IHS, Soula Proxenos, said: “The latest research into the provision of affordable housing in South Africa shows that it not only brings with it improved welfare and social cohesion, but is also an important facilitator of opportunities and wealth creation.

“It has been shown that people who take their first step onto the property ladder in this sector move beyond viewing their homes as a mere shelter.
“Instead, their homes become assets and through appreciation of these assets entrepreneurship, job creation and access to higher levels of education are stimulated.”

Proxenos said IHS is delighted by the latest investment in the fund by Eskom, as it will further strengthen the sector and the economy as a result of the opportunity it will provide to thousands of families.

She said that the affordable housing market caters to households with an income between R3 500 and R18 000 per month.
People in this segment earn too much to qualify for government’s low-cost subsidised housing and too little to afford the cheapest standard private sector houses or to qualify for bonds.

However, even though they are in a position to buy their own homes, there is a shortage of stock in this market.
“IHS Fund II aims to make a substantial contribution to the supply of additional housing stock in this critically under-supplied market,” said Proxenos.

Proxenos said government alone cannot fix the whole housing challenge and that the gap market is ripe for further private sector development, especially of the right kind of sustainable initiatives, which allow more people to join the formal housing ladder in the affordable housing sector.
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