Namibia Mortgage Acceptance Corporation (Namibia MAC), a subsidiary of Africa Growth Corporation seeks to raise $250m to accelerate the privately funded affordable housing mortgage market in sub-Saharan Africa.

Namibia MAC has announced its intention to launch a Regulation D (506(c)) offering with the US Securities and Exchange Commission (SEC) to secure funds through accredited investors to facilitate access to financing solutions and promote sustainable, responsible homeownership for middle income, and emerging middle-income government workers in Namibia. 

Namibia MAC will seek to place a $250,000,000 bond program in initial tranches to accredited investors to match the monthly mortgage funding demand in Namibia. 

The company expects to return to investors an initial annual yield of approximately 9% in US Dollars, passed through from the underlying Namibian mortgages that are created. The company anticipates the bonds to be repayable in 2024, with a minimum investment of $10,000, and an intended listing on the New York Stock Exchange post placement.

In addition to asset-backed protection, the mortgages receive significant financial support from the Government of Namibia through a program offered exclusively to its employees. 

The Namibian government withdraws mortgage payments directly from the mortgage payers’ paychecks, though not more than 33% of their gross income, so investors can have confidence in the mortgage repayment process.  

Namibia MAC’s bond offering will be syndicated to broker dealers across the US and internationally.  

Nambia MAC estimates that the sub-Saharan Africa mortgage finance shortage is a $2trn market opportunity.  Currently, only 2% of Sub Saharan African families have mortgages today. 

The current market demand in Namibia alone necessitates the immediate creation of approximately 300,000 mortgages (equating to a financing volume of $10bn to $15bn). Furthermore, with a rapidly growing population and a robust urbanization rate of 4.43%, demand for affordable housing in Namibia is expected to remain strong for the foreseeable future.

Christopher Darnell, Chairman, Africa Growth Corporation, said: “Though the scale of the housing shortage is considerable, we expect to raise a significant portion of the necessary capital over time through continual NYSE bond offerings, acting as a seamless conduit for capital to flow between Wall Street and a wide variety of countries in Sub-Saharan Africa.”

“This initial offering will be the first step of many to provide meaningful private financing solutions to Namibia and the broader sub-Saharan mass housing market,” he said.

“We believe that this is an excellent opportunity to help resolve a massive social problem while generating significant revenue and value for our bondholders and shareholders. 

To provide some perspective of the scale of the market opportunity, Darnell said that the mortgage on a single office tower, (9 West 57th Street in New York City) is reported to be $1.2bn, which is more than all the mortgages that exist in Angola, Cameroon, Mozambique, Uganda, Zambia and Zimbabwe combined, representing a combined population of nearly 150 million people. 

“The scale of human suffering we seek to alleviate by enabling the creation of affordable and proper housing conditions, in perfect correlation with the commercial and profit-driven opportunities available by financing the required mortgages, can only be described as a historic opportunity,” he said.