Project Finance. That is what Housing Finance, one of Kenya’s biggest mortgage lenders is calling the service. The innovation, aimed at both aspiring and established property developers, is based on a type of financing based on anticipated cash inflows or income of the property being developed. Simply, the viability of the loan will be based on the income you anticipate from the construction project. Whether Housing Finance will grant you a loan or not is based on the viability of the project, evaluated in the context of the various risks that the project may face.  You know, where is the project located and whether the house or business premises can fetch as much rent as you anticipate? Who are the potential buyers of your houses?  Can they actually afford the house you've developed or the rent you're charging?

[caption id="attachment_4401" align="alignleft" width="300" caption="Turning dreams into homes...small restaurants and business premises"][/caption]

So what kind of projects can be financed? The nature and form of projects is according to the entrepreneurs’ needs (that means whatever you're developing can be considered) however the most common types revolve around projects such as development of small restaurants, expansion of hotel facilities, development of serviced apartments, development of business premises or office blocks, building of multiple dwelling units for rental or sale amongst others. Basically an eatery business or a home, stand-alone or apartment style.

The types of loans offered under the Project Finance service solution include the following:

1. A short-term construction loan of 4 to 6 months for construction of single dwelling units.
2. A short-term multiple development construction loan and bridging loan facilities for a period of up to 24 months.
3. A long-term financing of a wide spectrum of commercial and residential properties for rental is also available.

In addition, the experts at Housing Finance will provide relevant support in evaluating the construction project proposals for the project concept, commercial, technical and financial viability. The owner of the plot under development continues to take full responsibility for management of the construction including the construction team and making good of the loan facility and the role of Housing Finance is limited to the provision of construction finance. It is still a loan anyway.