The Gauteng Partnership Fund (GPF) is encouraging property developers to apply for funding from its Rental Housing Fund as part of its mission to promote affordable and quality accommodation.

The demand for affordable rental housing continues to exceed supply, particularly in urban areas in Gauteng. Addressing this housing shortage is not just a matter of infrastructure but a critical step towards social equity and economic development.

Gauteng property developers that provide affordable housing units to households earning a gross monthly income of between R3 500 – R25 000, with maximum rentals of up to 35% of the affordable housing income bracket (dependent on project location), can apply.

Projects that qualify for support from the Rental Housing Fund include inner-city residential refurbishments of dilapidated buildings, conversions of office-to-residential units, and greenfield developments.

The Gauteng Partnership Fund will provide an investment of up to 30% of the total project cost, depending on a discretionary assessment of the project’s needs, while providing 100% of funding for projects with a total loan exposure of R8 million or below.

The investment term is 15 to 20 years, depending on project cashflow and a company’s Historically Disadvantaged Individual (HDI) participation level with the investment pricing a minimum of Johannesburg Interbank’s Agreed Rate (JIBAR) plus a margin.

The required security for funding includes a mortgage bond or personal sureties with the developer’s contribution a minimal 5% of the project cost, dependent on project cashflows.

Who qualifies for funding from the Rental Housing Fund?

• A potential project that can yield a minimum of 15 affordable housing units in Gauteng.
• A company that can demonstrate access to unencumbered capital of a minimum of 5% of the total project cost as equity.
• An entity that can demonstrate to the Gauteng Partnership Fund that they have the technical resource capacity to successfully complete the project, as well as efficiently manage the property thereafter.
• A project that is ready for implementation from a town planning perspective.

Documentation required:

• A comprehensive business plan (the recommended business plan framework is available on request).
• Company registration documents.
• A tax clearance certificate.
• Essential project information.
• Approved, correct zoning.
• Geotech.
• Elemental bill of quantities.
• Plans and elevations.
• Proof of ownership.
• A copy of the latest audited financial statements.
• A shareholders’ statement of assets and liabilities may be requested.

The Gauteng Partnership Fund was established by the Gauteng Department of Housing to address funding challenges in the affordable housing sector. It combines resources from the private and public sectors to speed up the development of inexpensive rental housing near amenities and economic opportunities. It aims to enhance the socioeconomic state of Gauteng communities.

For more information or to apply for funding contact Sandra Ruiter (sandrar@gpf.org.za / 082 850 9170).