IMPORTANT NOTE: high risk product - direct investment to a company. No local partner in between to cover risks.
Issuer: Homelux Property Development
Maturity: 36 months, semi-annually and linearly amortizing
Interest rate: 6% p.a.
This is a co-financing project: 33% of the funding needed will be crowdfunded via Lendahand, 67% will be financed by institutional investors. One of these institutional investors is the Dutch Good Growth Fund (DGGF), a mandate from the Dutch Ministry of Foreign Affairs managed by Triple Jump.
This is a direct investment to a company (rather than lending to a financial institution) and therefore it is recommendable that you are careful with the amount you will invest.
Vakayi is an SME (small and medium size businesses) impact venture fund that commenced operations in late 2016. The fund has to date been supported by the Dutch Good Growth Fund, a Dutch government fund of funds created to support funds in emerging and frontier markets. It has also received support from Capria Accelerator Fund a fund accelerator and advisory based in Seattle, USA. The fund aims to invest in Zimbabwean SMEs in the essential services (healthcare, housing/property, education and clean energy) to achieve superior rates of capital appreciation as well as social impact.
About Homelux and the Project
Justin Machibaya founded Homelux Real Estate (Pvt) (“HRE”) Ltd in 2002. HRE is in the business of property sales, property management services and valuations. In 2006 Justin Machibaya created Homelux Property Development (“HPD” or “Homelux”) which is in the business of property development. Homelux has successfully completed numerous residential property developments, early-on in the middle and top income segments of the markets. Homelux has recently begun developments for the low-income segment of the market following the demand and attractive margins in the segment.
With a EUR 125,000 loan Homelux will develop 160 ready-to-build residential stands for the affordable housing market in Harare. There is a serious shortage of housing in the affordable segment of the market with the city municipality reporting that there is a housing backlog of over 1 million units. This loan will enable families the opportunity to own their own home.
Impact of the loan:
- 160 new homes
- 80 jobs created
- Pre-school to provide services for a 100 children
It is expected that buyers will buy the residential stands for cash. It is expected that all the stands will be sold over a period of 18 – 24 months. Homelux will make quarterly repayments of the loan over 3 years.
Chai Musoni – Partner/Chief Executive Officer Chai is the founding partner of Vakayi. He has worked in corporate finance for over 20 years doing deals in Zimbabwe and the region. Before starting Vakayi he was the head of Deal Advisory for KPMG in Zimbabwe. He has extensive business networks in Zimbabwe and deep domain experience. He holds a B.Compt (Univeristy of South Africa) and an MBA (The Henley Management College).
Patrick Makanza – Partner/Chief Investment Officer Patrick is the founding partner and of Vakayi. He has extensive private equity experience having worked for one of the country’s first equity funds for over 15 years, joining as an analyst and rising to become the managing director. He holds a BBS (UZ) and an MBA (UZ).