The MREIF has raised N250 billion to address Nigeria’s housing finance gap, gaining strong private sector support. This follows an earlier N150 billion raised, with the total contributing towards a N1 trillion goal for affordable housing. The fund offers long-term mortgage financing and low interest rates, aiming to increase investment in residential projects. Minister Wale Edun and MOFI’s Armstrong Ume Takang emphasized the initiative’s transformative potential.
The Ministry of Finance Incorporated Real Estate Investment Fund (MREIF) has successfully raised N250 billion in a pilot fundraising round, addressing Nigeria’s significant housing finance gap. This announcement was made by Sani Yakubu, the executive director (co-ordinator) of MREIF, highlighting robust private sector engagement in this initiative. The fundraising included a fully subscribed N100 billion issuance in its second series, showcasing institutional investors’ confidence in the fund’s potential to facilitate long-term housing development.
Following the prior fundraising of N150 billion in Series 1, supported entirely by MOFI as the anchor investor, the total funds raised now contribute to MREIF’s goal of attaining N1 trillion to enhance access to affordable housing. The MREIF offers long-term mortgage financing with repayment terms spanning up to 25 years and interest rates starting at 12 percent, considerably lower than prevailing commercial lending rates, alongside offering off-take guarantees to stimulate residential project investments.
According to Wale Edun, Nigeria’s finance minister, the successful fundraising marks a pivotal shift in Nigeria’s housing sector, indicating a strong market demand for structured, long-term housing finance solutions. He stated that the complete subscription of Series 2 highlights this demand and confirms investors’ faith in MREIF as a sustainable investment vehicle. Armstrong Ume Takang, managing director of MOFI, noted that MREIF is opening new investment opportunities in Nigeria’s housing market, demonstrating investor trust in its long-term viability.
The MREIF’s multi-tranche program combines subsidized public funds with market-rate private capital, intended to reduce borrowing costs for future homeowners. Upcoming fundraising rounds are anticipated to expand investor participation further, accelerating the development of affordable housing across Nigeria.
The successful fundraising of N250 billion by MREIF underscores a significant step towards addressing Nigeria’s housing finance shortfall. With continued interest from institutional investors and a solid framework designed to enhance long-term housing development, MREIF moves closer to its N1 trillion target. This initiative represents a transformative evolution in the housing sector, promising more accessible home financing for Nigerians. The blend of public and private funding in the MREIF framework is poised to unlock new opportunities in the residential market.
Original Source: www.premiumtimesng.com
