SSFR sinks Rwf20b in real estates as demand surges

In order to cut the deficit in house supply, the Social Security Fund of Rwanda (SSFR) has invested a tune of Rwf20 billion in real estate projects as of May 31 2009, the pension body said in a report dated July 2009.
The Director General of SSFR, Henry Gaperi is at the helm of the pension body’s investments. (File Photo)
The Director General of SSFR, Henry Gaperi is at the helm of the pension body’s investments. (File Photo)

In order to cut the deficit in house supply, the Social Security Fund of Rwanda (SSFR) has invested a tune of Rwf20 billion in real estate projects as of May 31 2009, the pension body said in a report dated July 2009.

The latest report on SSFR’s contribution to the economy indicates that already established real estate projects are worth Rwf6.9 billion while ongoing projects are valued at Rwf13 billion.

“These are some of the projects undertaken by the SSFR without involvement of other investors,” the report from the Department of Planning, Research and Statistics reads in part.

According SSFR, some of the ongoing real estate projects include; the Insurance Plaza whose investment is valued at Rwf5.2 billion while the Gacuriro phase 2 project where 234 housing units are planned has so far consumed Rwf500 million.

Others also include value of investment in district branches with Rwf7 billion and Rwf238 million injected in the shopping mall.

The total investment, as of May in, already established and ongoing real estate projects is valued at about Rwf25.3 billion.

However, the statistics imply that the pension body slightly above half of its annual investment budget of Rwf38.7 billion on real estate investments within the first five months of the year. 

Some of the established projects highlighted in the report include; Kacyiru estate with investments worth Rwf263 million, Rwf571 million pumped in the UCT Building, Rwf5.1 billion in Kacyiru Executive Apartments and Rwf918 billion for the Former American Embassy.

The figures come at a time when government statistics show that Rwanda needs about 250,000 housing units per year with Kigali alone estimated to require over 100,000 units.

With such massive demand, the Actuarial Consulting Group’ (ACG) recommended that Rwanda’s public pension body should venture into housing projects, as a way of investing savings and sustainability of the fund.

The Singapore-based consultancy firm was contracted to carryout a study in December 2007, to determine the SSFR’s funding status and whether it is financially sustainable.

The firm proposed that a scheme dubbed as ‘Home Ownership Scheme,’ would facilitate Rwandans own an asset as a valuable investments in their lifetime.

The consultants however said that the current prices of homes built by SSFR are misaligned with the income of pension contributors, making home ownership out of reach for many.

According to findings there is an increased demand of housing in Rwanda which far exceeds supply, especially in the major cities.

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