IDBZ to issue $15m housing bonds

HARARE - The Infrastructure Development Bank of Zimbabwe (IDBZ) says it is set to issue over $15 million in housing bonds to fund various projects under preparation.

The state-owned institution — whose mandate is infrastructure development — successfully issued its maiden $5 million housing bond last year through private placement and anticipates issuing the $15 million bonds during this second half of the year.

“The bank will be issuing additional tranches of the housing bond of up to $15 million in 2016 to fund various projects currently under preparation once they are ready for implementation,” the group said in a stakeholder update released yesterday.

IDBZ also said it had received the thumbs up from Treasury to issue bonds worth over $100 million in the next five years.

“The bank has authority from the Finance ministry to issue housing bonds of up to $100 million over a five-year period and the bond issuances will be underpinned by bankable projects that demonstrate off-take capacity and financial viability,” the bank said.

IDBZ’s $5 million bond issued last year was fully subscribed, and has a five-year tenor carrying a fixed coupon of 9,5 percent per annum.

Proceeds of this bond are financing development of two housing projects; New Marimba Park in Harare and Clipsham Views in Masvingo, where servicing is in progress.

The projects collectively deliver 1 042 serviced residential stands and the instrument has had one coupon payment settled in June.

IDBZ is presently developing 338 high-to-medium density residential stands under its New Marimba housing project.

It is estimated the exercise will cost plus or minus $2 million.

Both the 300sqm stands and 510sqm stands, for which deposits ranged from $2 500 and $4 400, would be paid for over a period of 10 years and the cost will attract interest of 10 percent per year.

The project is part of IDBZ’s contribution towards closing the country’s over 1,5 million housing backlog.

IDBZ recently came up with a draft housing policy to its guide sector interventions aimed at easing the housing shortage in the next two years.

The draft policy outlines plans to acquire land for housing development and funding mechanisms for the delivery of affordable units.

Comments (1)


Priscillah - 23 August 2016

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