Norsad Capital, an impact investor and private credit provider, has structured a ZAR100m revolving debt facility to Lakutshona Housing Company (Pty) Ltd, a well-established property company in the Western Cape, South Africa, that owns, develops and manages property.
Access to adequate and affordable housing in South Africa continues to be a persistent challenge faced by the country’s populace. Despite the government efforts to provide subsidised housing to the low-income population, as of 2021 there was an estimated housing shortage of 3.7 million units, with a continued growth rate of 178,000 year on year. An estimated 12.5 million people, 12.7% of households in South Africa, reside in informal dwellings, suggesting that a significant proportion of the population resides in living conditions characterised by poor housing facilities and lack of access to basic services such as water and sanitation. The growing housing shortages and inadequacies also contribute to economic losses as the workforce’s living conditions negatively contribute to their well-being, health and access to essential services and amenities.
Carol-Jean Harward, Investment Director at Norsad Capital and transaction lead said: “This funding presents a unique opportunity for Norsad, in partnership with Lakutshona Housing Company, to provide affordable housing to the South African middle-income demographic. The investment is aligned with Norsad sector focus on soft and social infrastructure and strategic lever of deepening investment into South Africa. It also ensures the realisation of SDG11 on ensuring access to adequate, safe, and affordable housing for all.
Kobus Le Roux, Owner, and Founder said: “The transaction happened at a time when there is significant demand for affordable housing in Western Cape, especially the Paarl region. The funding will be used for the development of affordable residential property in Paarl which will eventually consist of 441 residential units delivered through a phased approach. Lakutshona is very pleased to partner with Norsad, a reputable impact investor, on this project. By investing in affordable housing projects, Norsad plays a critical role which serves basic human needs of access to decent shelter which is crucial for wellbeing and prosperity of individuals and society at large.”
About Norsad Capital
Norsad Capital is an impact investor providing tailormade debt solutions to mid-market growth companies in Sub-Saharan Africa. With a track record spanning over 33 years, Norsad Capital has invested in 150+ companies across the continent. For more information: www.norsadcapital.com
About Lakutshona
Lakutshona Housing Company (Pty) Ltd is a well-established Company that owns, develops, and manages property, as well as providing Housing solutions in South Africa.
Originally established to develop a housing model for the assistance of Kumba Iron Ore employees to obtain accommodation and promote home ownership that suited their various affordability levels by offering Rental Units and promoting home ownership, has since grown, and developed steadily in the last more than 18 years.
Today Lakutshona Housing Company (Pty) Ltd manages their own portfolio of 320+ houses in the Northern Cape as well as Sectional Title rental units in the Winelands town of Paarl in the Western Cape. Additionally, the business also manages and maintains a Kumba Iron Ore portfolio of more than 900 units on behalf of the Mining Company.
