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New R1,25bn housing development for Free State

New R1,25bn housing development for Free State

JSE-quoted construction firm Basil Read on Wednesday signed a partnership agreement with State-owned financier National Housing Finance Corporation (NHFC) to develop low- to middle-income housing

The R1,25-billion development situated near Welkomia in the Free State is set to start soon, and will include 6 000 housing units, 40% of which will cater for the low-income market - or households that earn less than R3 500 a month, Basil Read Developments MD Desmond Hughes said.

Gold major Harmony Gold, which owns mines nearby, contributed 100 ha of land to the project, and the local municipality had made 500 ha available.

One-tenth of the units would be for rental, and one-quarter would be credit linked, which was where the NHFC would step in, he told Engineering News Online in an interview after the signing of the memorandum of understanding.

NHFC CEO Samson Moraba said that the partnership would help to alleviate a "huge backlog" in housing for South Africa's low-income bracket.

He said that the Welkom housing project, called Phakisa Estate, was just the beginning of the partnership with Basil Read.

Moraba added that Basil Read's track record of reliability, expertise, and its ability to take on large and technically challenging projects made the firm a partner of choice.

Hughes said that the Phakisa Estate would help to stimulate Welkom, and would be another step in the journey to clear South Africa of squatter camps, replacing these informal settlements with proper housing.

"I believe that we have to change townships into suburbs, eradicating them from the country," he stated.

Decades of reliance on cheap black labour has left South Africa strewn with thousands of informal settlements, where people live in shacks and suffer health problems and high crime levels.

The country's democratic constitution says that every citizen has the right to decent housing.

Hughes said that the Financial Sector Charter that government introduced forced banks to finance low-cost housing projects, where they had previously shown strong resistance.

This had opened up new opportunities for Basil Read, and it was looking to develop similar projects near Orange Farm and in Knysna.

What was important about these developments was that they integrated people from a range of income groups.

Basil Read had already constructed the 11 490-unit Cosmo City north of Johannesburg.

Hughes said that struggling State-owned power utility Eskom had committed that its capacity shortage would not impact on the delivery of housing to the poor.


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