NHC plans issuing the delayed Sh5bn bond by end of June

Mr George Kinyanjui, the NHC finance general manager. PHOTO | FILE 

By JOHN GACHIRI, jgachiri@ke.nationmedia.com

In Summary

• NHC also plans to raise more funds by packaging some of its properties under an Income-Real Estate Investment Trust (I-Reits) and similar securities.

The National Housing Corporation (NHC) plans to issue the Sh5 billion bond whose lunch was put off last year by the end of June.

The State-funded housing agency has already picked transaction advisors for the bond issue, who include the International Finance Corporation (IFC).

NHC finance general manager George Kinyanjui declined to disclose the other advisors. He however revealed a rating agency had been engaged ahead of the issue.

Insiders told the Business Daily that NHC had settled on South Africa’s Global Credit Rating (GCR).

NHC also plans to raise more funds by packaging some of its properties under an Income-Real Estate Investment Trust (I-Reits) and similar securities.

“In addition to the bond we are looking at I-Reits for some of our properties and asset-backed securities,” said Mr Kinyanjui.

NHC initially planned to issue the bond in the second half of 2015 but the market turned sour due to volatility in interest rates.

The market was made worse by the collapse of Imperial Bank which affected the uptake of issues such as Family Bank’s debut bond and Credit Bank’s private share placement.

The Sh5 billion NHC bond is part of the Sh10 billion medium term note programme which targets to build 6,000 housing units in the next few years.

NHC has in the past said the housing bond will finance the building of maisonettes in Stony Athi in Mavoko, Machakos, where the parastatal owns 150 acres, as well as flats in Mombasa and Kisumu.

The agency currently supplies about 1,500-2,000 residential units yearly, through a mix of schemes such as mortgage, rental houses, tenant purchase programmes and site and service schemes.

READ: NHC to diversify into commercial properties

Since inception in 1967, the NHC has developed more than 43,000 housing units including estates such as Ayany, Kyuna, Uhuru Gardens, Kibera Highrise, Jonathan Ng’eno, Nairobi West, Madaraka and Kileleshwa in Nairobi.

Some of the funds from the bond will go towards the expansion of the NHC’s expanded polystyrene panels (EPS) factory in Mavoko, Machakos County.

More developments are also coming to the market from NHC’s line ministry. The Housing ministry is revamping old estates in Nairobi to make more houses available