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Alleyroads Gets Additional R175M from IFC for Affordable Rentals

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8 months ago

August 30, 2023

Alleyroads Gets Additional R175M from IFC for Affordable Rentals

Alleyroads, a prominent black-owned national property developer and landlord focusing on affordable residential housing, retail, and industrial property, has secured R175 million from the International Finance Corporation (IFC). This funding constitutes the second tranche of a financial package to support the construction of affordable rental housing projects in three locations: Inkanyezi Village in Katlehong South, John Dube Village in Springs, and Meyerton Ridge in Meyerton as reported by Property Wheel.

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The initial tranche of R130 million was disbursed in 2022, and the recent infusion is part of a structured three-step payment mechanism stipulated in the loan agreement. Alleyroads’ compliance with rigorous terms and development milestones prompted the release of the second tranche. The projects encompassing these locations above are progressing according to schedule, and this additional funding will accelerate their completion.

Founder of Alleyroads, Ivan Pretorius, notes that these developments are crucial in addressing the substantial housing gap within Gauteng’s affordable housing market. Particularly targeting the rental segment ranging from R4,000 to R6,000 per month, these initiatives cater to lower-to-middle-income households with an average annual salary of around R238,000.

This second tranche of R175 million contributes to a larger green A-loan investment of R325 million, which was established with the IFC in 2022. The total estimated cost of these projects stands at up to R620 million, with Alleyroads’ shareholders providing the remainder through equity.

As a distinguished IFC EDGE Champion and the first entity globally to attain EDGE Version 3 certification, Alleyroads has designed its apartment units in compliance with IFC’s EDGE Advanced green building standards. This design choice renders them zero carbon ready. It positions them as among the first residential units in sub-Saharan Africa to achieve such a high level of resource efficiency.

Anticipated for completion by the end of December 2023, with occupation commencing in early 2024, the developments at Inkanyezi Village, John Dube Village Phase 1, and Meyerton Ridge will collectively offer 1,061 affordable units capable of accommodating up to 4,244 residents.

Featuring two-bedroom, one-bathroom units averaging 55m², each with a balcony, these apartments are equipped with modern kitchens boasting granite countertops, spacious lounges, and built-in cupboards in all bedrooms. The units are tastefully tiled, and their bathrooms are furnished with quality, contemporary sanitary ware. Notably, the apartments come with a DSTV connection point.

Beyond the housing provisions, tenants are entitled to 250 Megabytes (MB) of complimentary Wi-Fi monthly, with the option to acquire additional data through a designated service provider. The units are connected to a solar system, facilitating a monthly utility cost reduction of at least 30%. Pre-paid water and electricity meters allow tenants to monitor their consumption closely.

Incorporating security features, such as electric fencing and 24-hour surveillance, along with parking spaces and a recreational play area, these developments offer a comprehensive living solution to their future occupants.