Gauteng Partnership Background
The Gauteng Partnership fund (GPF) was established by the Gauteng Department of Housing to address funding challenges in the affordable housing sector.
The GPF assists the affordable housing sector by:
- Providing public funding as equity cushion to investors.
- Providing prospective funders with sustainable entry into the social housing financing market by means of various products.
On a project-by-project basis, GPF will assist the housing companies to procure finance at the most favourable terms in order to promote affordable, quality accomodation that is well managed for the target market.
Product Offerings
The GPF seeks to continually develop products aimed at addressing housing market funding challenges. GPF products are reviewed annually to determine thier effectiveness.
Investment Term
15 - 20 years depending on project cashflows and company BEE levels.
Investment Pricing
Minimum JIBAR plus 2 basis points
Investment Instrument
Subordinated debt.
Security
- Mortage Bond
- May require personal sureties
- Client contribution: minimum 2.5% or 10% of project cost depending on project cashflows and company BEE levels
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Client Contribution
- Minimum 2.5% or 10% of project cost depending on project cashflows and company BEE levels
Rental Housing Fund
The Rental Housing Fund was developed for entrepeneurial rental housing institutions that require an equity injection to the project. The GPF equity enhances the debt to equity ratio for projects to enable lenders to finance, on favourable terms.
Who Qualifies
Any company or project (SPV) with a recognised legal form that provides rental or delayed ownership schemes to majority families with houselhold with monthly income less than R15 000.
(Adjusted according to CPI)
The insitution must demonstrate to GPF that they have the technical resource capacity to succsesfully complete the project as well as efficiently manage the property thereafter.
Types of Projects
- Inner-city residential refurbishments.
- Conversion of offices to residential units.
- Greenfiled developments.
Exposure
GPF investment of up tp 20-30% of the total project costs depending on the discresionary assesment of project needs.
Documentation Required
- Comprehensive Business Plan.
(Recommended business plan framework is available on request.)
- Company registration documents.
- Tax clearance certificate.
- Essential project information
- Copy of latest Audited Finacial Statements for companies or confirmation of annual auditing for newco or company that has traded for less than a year.
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