Shelter Afrique Invests Sh200mn in Mortgage Refinancing Firm

Pan African housing development financier, Shelter Afrique has invested Sh200mn in the Kenya Mortgage Refinance Company to support the development of affordable housing to meet the rising demand.

 

Confirming the firm’s contribution, Shelter Afrique Chief Executive Officer Andrew Chimphondah said there were many Kenyans who would like to own houses but do not have access to affordable finance.

“We are encouraged by the formation of the Mortgage Refinance Company which provides long term lending to commercial banks, microfinance banks and Saccos to allow them to extend mortgage loans to eligible mwananchi over a longer period and at a lower cost. That is important because that enhances affordability and boosts uptake of housing. I am happy to announce that Shelter Afrique has invested $2m in the Company to stimulate the demand for affordable housing,” Chimphondah said.

 

He noted that housing developers were not keen on building houses without guaranteed take-up, hence less focus on the lower end of the market. He added that that a lack of affordability also explains the reasons why there were only 24,000 active mortgages in Kenya despite the country having a housing shortage of over 2 million units.

“If 100 Kenyans apply for mortgages only five will qualify because of lack of affordability; 10 might be due to high credit risk, but the majority will be disqualified on the basis that they wouldn’t be able to the mortgage repayment terms”.

Free land

Chimphondah lauded the government’s efforts to provide free land to developers and also for undertaking to provide necessary infrastructure conducive for housing development, under its affordable housing plan, which seeks to develop 500,000 housing units by the year 2022.

 

“Cost of land constitutes about 40% of the total cost of a housing unit and the Government undertaking to provide free land means a discount of equal margins on the units already,” said Mr Chimphondah. “Through such initiatives, it’s possible to develop housing units costing as low as KSh1.5 million which I believe would be affordable to many Kenyan.”

 

The Kenya Mortgage Refinance Company, fashioned as an implementing arm of government’s affordable housing plan, operates as a private sector-driven company with the purpose of developing the primary and secondary mortgage markets through the provision of long-term funding to the mortgage lenders, thereby increasing the availability and affordability of mortgage loans to Kenyans whose incomes cannot allow them to take home loans from financial institutions.

Source: Capitalfm

New York’s Plan to Make 50,000 Buildings Super-Efficient

The Climate Mobilization Act is the city’s effort to abide by the Paris climate-change agreement even after the Trump administration withdrew the U.S. from the global accords. Before its abrupt about-face, America’s plan had been to cut carbon emissions by 80 percent by the year 2050. New York is taking up that pledge by introducing new regulations to address the energy performance of buildings.

Buildings contribute a huge share of New York’s carbon emissions—nearly 70 percent, thanks to normal everyday use, but exacerbated by inefficient heating and cooling systems—so they’re an obvious target for regulation. But it’s less obvious how the building sector will answer this charge.

There’s a fundamental mismatch in expertise: The people who know how old buildings really work aren’t the same people designing energy-efficient retrofits. Only a big push will get them in the same room (at great expense to landlords).

The city’s new “80-by-50” law prescribes several benchmarks along the way to the ultimate goal in 2050. Some buildings will need to produce real results soon; different types of buildings will be subject to specific targets.
The city’s first big milestone arrives in 2030: By then, New York buildings will need to have collectively cut their carbon emissions by 40 percent. Any buildings larger than 25,000 square feet will be subject to the cap (with some key exceptions), which means around 50,000 buildings in total. For landlords and building owners, this is an enormous lift in just over 11 years.
That’s by design.“There’s still a lot of details to figure out as to how this gets implemented,” says Lindsay Robbins, a director for strategy and implementation at the Natural Resources Defense Council, which hashed out this policy’s compromises with the Real Estate Board of New York. “I don’t think any city has done this on this scale before.”The hope is that New York’s climate law is awesomely burdensome. No, that doesn’t mean a ban on glass skyscrapers. But a law that turns over the everyday dealings of real estate in New York has a great deal of promise for upsetting how buildings work everywhere. That’s what this represents, according to supporters like John Mandyck, CEO of the Urban Green Council, a nonprofit devoted to making New York buildings sustainable. “This law could possibly be the largest disruption in our lifetime for the real-estate industry in New York City,” he says.

New York’s new law is an effort to make the road by walking: It’s not something anyone knows how to do until everyone commits to doing it. The fact that this legislation is sweeping in its scope is why it stands a chance of succeeding, its supporters say. It’s the first plank in the suite of legislation that Mayor Bill de Blasio describes as the city’s own Green New Deal.
The idea is to build a durable industry in energy retrofitting, one that benefits everyone involved—and by doing so, establishing a model for other cities around the world. And the city can’t get there with a measure that asks building owners to simply swap out light bulbs.

“New York City is going to spend billions and billions of dollars to meet this new law. When we do that, New York Harbor is still going to flood if the rest of the world doesn’t enact aggressive climate reduction strategies as well,” Mandyck says. “Our point all along has been that if we’re going to spend the billions of dollars, let’s make sure we come up with policies that are exportable.”

New York is going it alone here

Other cities are looking at building performance, to be sure. Every city has an incentive to level up the energy efficiency of buildings: In New York, buildings alone account for 95 percent of electricity use for the city, according to the Urban Green Council. But most cities have not taken steps beyond tracking and disclosure.

More than 25 U.S. cities have adopted various energy-benchmarking policies, as have the states of California and Washington. These laws make it mandatory for building owners to report their energy use (namely their electric and gas bills). Disclosure laws have guided net-zero building codes and voluntary agreements. Philadelphia and Washington, D.C., were early signers.

It’s worth noting the limits of disclosure. Building owners who don’t meet voluntary standards don’t pay any price. Importantly, disclosure is not supposed to be a shaming tool: Benchmarking in New York might show a range in energy consumption by hotels, for example, with usage calculated per square foot so as to compare big hotels with small ones, without naming any specific buildings.

What New York is doing is more strident: It’s the first city to attach a dollar value to these disclosure figures. Washington, D.C., passed a building-energy performance standard in December for buildings over 50,000 square feet, and when buildings in the District fall out of compliance, those landlords will be moved into an advisory lane to get back on track. San Francisco passed a law this month requiring big buildings to switch to renewable electricity, an easier goal for a city with a forgiving climate located in a state with a cleaner grid.

In New York, building owners who don’t meet their carbon reduction requirements will pay fines. Potentially very large fines: The statute calls for a penalty of $268 per every assessed ton of carbon over the cap. For landlords just over the line, the fine will be nominal. But the city’s worst offenders could be looking at annual penalties of more than $1 million.

It’s a policy with teeth, in other words. Fortunately for landlords, there’s a lot of room for buildings to improve, according to Vivian Loftness, professor at Carnegie Mellon University and the Paul Mellon chair architecture.“Buildings in the U.S., and certainly commercial buildings, have been incredibly sloppy in their energy use,” Loftness says.
“We’ve got [older] mechanical systems that are running at 50 percent efficiency, where there’s things on the market that will run at 95 percent efficiency. We’ve got a lot of room for upgrades for boilers and chillers, air-handling units, control systems—there’s so much room in just the hardware of buildings.”New York’s strict standard may work for landlords. 

The Climate Mobilization Act sets deep reduction targets over a fairly short period. Since the law establishes 2005 as the benchmark year—meaning building energy consumption needs to fall 40 percent below 2005 levels by 2030—landlords who have made some strides in energy reduction will get credit for their work.

The poorest performers will need to show improvement sooner, by 2024, but about one-quarter of buildings won’t require substantial changes. Taking the progress already made into consideration, New York will need to level up its building-energy-performance game by 26 percent over the next 11 years.

Still, it’s significant, especially for New York landlords with multiple buildings in their portfolio. The Real Estate Board of New York, which represents many large developers, has vocally opposed the legislation. The legislation “does not take a comprehensive, city-wide approach needed to solve this complex issue,” said John H. Banks, the board’s president, in a statement. The group objects in particular to exemptions that they say put a greater strain on the building owners subject to this regulation.

 

“A coalition of stakeholders including environmental organizations, labor, engineering professionals, housing advocates and real estate owners came together and proposed comprehensive and balanced reforms that would have achieved these goals,” Banks said.
“The bill that passed today, however, will fall short of achieving the 40 x 30 reduction by only including half of the city’s building stock.”Douglas Durst, the chairman of the Durst Organization, wrote in a letter to Crain’s New York Business that under this legislation, “empty buildings score better than occupied ones, and hundreds of thousands of inefficient and energy-intensive smaller, city-owned and [New York City Housing Authority] buildings have significantly less stringent standards.”“To get down to even 20 percent from where I am today, with the technology that exists, there’s nothing more that I can do,” Ed Ermler, the board president for a group of condo buildings in Queens, told The New York Times. “It’s not like there’s this magic wand.”

It will take work, no question, says Lane Burt, managing principal for Ember Strategies, a consultancy and strategy firm. But it will not take a wizard. For starters, not every individual building needs to make the 40 percent mark: That’s an aggregate goal. And buildings don’t need to hit their target tomorrow.

“If you’re a building owner and your engineers are telling you, it’s impossible to get 20 percent carbon reduction or 30 percent carbon reduction, really, you need better engineers,” Burt says. “What I interpret from that concern is that the owners are saying, ‘It’s financially impossible for me to do this right now.’ And that I believe completely.” He adds, “The good news is, it might be financially impossible for them to do right now, but we’re not necessarily talking about right now. We’re talking about three decades.”

Over a long enough time span, in fact, the heavier lift makes it more likely that landlords will succeed, not less so, according to supporters of the bill.“What’s smart about this bill is it doesn’t ask for a small increase. It asks for a big increase,” says Greg Kats, president of Capital-E, a clean-energy consultancy and capital firm.
“It’s the kind of thing where if you’re going to do something, you should do quite a lot of it, because the transaction costs [for landlords] to set it up, to engage with tenants, are substantial fixed costs.”Switching to solar might show gains in kilowatt hours fast. But often, measuring energy efficiency is trickier. It means achieving a negative outcome, a reduction in energy consumption, usually by introducing additive systems that contribute to an overall decrease. Buildings are complex systems: Higher-efficiency windows lead to lower air leakage, which reduces heat loss, which lowers heating bills. Buildings are all different, though, so figuring out the suite of improvements suited to a particular building is complicated.

After all, the work involved is interruptive, whether it means overhauling HVAC processes or considering more costly improvements to a building’s roof or facade. While tenants see the benefit of this work once it’s done, they hate it while it’s happening. With a long-enough runway, landlords can plan around the natural business cycle of a lease (around 10 years, generally) to find the lowest-cost window for this work. And given a tall order, building owners have an incentive to spend in order to achieve big savings.

The hassle of getting to a 10 or 15 percent reduction is not that different from reaching 40 percent, Kats says. Either way, a landlord needs to capture data, engage with landlords and utilities, meet with vendors and consultants, and buy new equipment. These transaction costs are high, but many of these costs are the same whether the goal is 15 percent or 40 percent.

A bad bill—something that asked landlords to make smaller changes more gradually, or with less certainty about future benchmarks or timing—might encourage landlords to look for the low-hanging fruit, the barest improvements necessary to meet the regulatory burden. But big asks translate into benefits that landlords can show to tenants. A law firm may not love an interruption from building management—but replacing office lighting with LED lamps that improve visual acuity? A promise against freezing-cold workspaces that landlords can actually keep? Tenants want those changes!

“If you go deep on [energy efficiency], there are some real economies of scale,” Kats says. Landlords can make changes “that save on capital costs or create more space for you that’s rentable space. It’s that kind of systems approach which deep upgrades allow that makes it much more cost effective.”

How will building owners come up with the capital? Deep upgrades require capital, of course. Improvements for buildings are expensive, and the payback is long. Most investors don’t think of the building sector as a 50-year investment or even a 30-year investment.

 

It’s rare for a building owner to weigh upfront investments against long-term operating costs, because the capital comes from different pockets, and the savings may variable or may not be guaranteed, according to Loftness. Building improvements ought to pay out within the lifetime of the equipment or materials, but not within, say, 5 years—so there’s a mismatch between up-front costs and long-term savings.

Owners who also occupy their buildings tend to have longer views about costs, she says, but they may not share the same long-term economics. The question is academic for a building owner who doesn’t have the capital to pay for building upgrades. So it’s good news, for both investors and owner-occupants alike, that the market has an answer to help New York meet this new burden.The solution comes from California.
When the state passed energy-conservation laws 30 years ago, it made utilities responsible for achieving those savings, with the idea being that utilities can bear to wait 30 or 50 years to see a gain. So California utilities have actively promoted investments, financed by the utilities themselves, as a way to meet the regulatory burden. A similar approach is likely to be popular in New York to meet the new energy benchmarks.“Rather than you, the building owner, having to come up with the money, the utility is coming up with the money, and basically taking the payback through the energy savings,” Loftness says. “Your bill stays the same, but 10 years later, you’ve paid back the ‘loan’ of what they invested in the building.”

The most common category of energy-efficiency financing are negotiated payments known as energy service performance contracts (ESPCs). Under this arrangement, a third party finances the upgrade, sharing the savings with the property owner and making a profit.

Third parties that develop, design, build, and fund these improvements are called energy service contract organizations (ESCOs). When utilities are directly involved, as in the California model, the savings-backed arrangements are called utility energy service performance contracts (UESPCs or USPCs), to complete the acronym soup of energy-efficiency financing.

Whether it’s Con Edison or Siemens, these organizations play an important function, as lenders, consultants, or engineers who help building owners bridge the gap for their capital needs.The federal government, for example, can literally print the money it needs to invest in its own energy retrofits. But federal agencies have a hard time getting Congress to actually allocate the funds to meet these standards (namely set by the Energy Policy Act of 1992).
So the government relies on ESCOs to finance and perform this work for federal buildings. As silly as it sounds, the federal government pays private entities to finance this work, through anticipated future savings, even though it’s a safe bet that the U.S. Department of Energy will still be here 50 years down the road.
State and local governments offer their own avenue for financing energy retrofits. Known as property assessed clean energy (PACE) programs, these municipal assessments are effectively loans that are attached to the property. PACE programs, such as the one that New York is introducing with the Climate Mobilization Act, offer long-term financing for little or no money down, with an alternative approach to underwriting that opens up access to these loans to a greater number of consumers than private lenders might.

 

By attaching a loan to a property (and not the property owner who takes out the loan), PACE assessments can transfer with the property when the title changes—meaning that a building’s former owner is not stuck with the tab.

Loftness says that she expects that this meta-industry around energy efficiency financing will be a much bigger part of the New York landscape by 2030 and beyond. “It makes financial sense,” Loftness says. “They make more money on the savings than they do on the expense to upgrade the building.”

An industry may emerge to fully support the changes coming to New York buildings. That doesn’t mean it won’t be a challenge. The city will need to help building operators and owners—the people who know the most about their buildings—talk with the people who can design the solutions to improve them over time. Operations and design engineering aren’t the same skill sets. It may take the full three decades between now and 2050 to find all the answers.

“The reality is, this is difficult. This is the engineering challenge of our time,” Burt says. “There’s not a lot of folks around who really understand how big buildings work, especially the way they were designed 50 or 60 years ago.”

This problem is not specific to New York. The knowledge gap between operating buildings in St. Louis and boosting building performance in St. Louis is just as wide. But if New York can figure out a solution that touches all the buildings in New York, then it will have necessarily developed the knowledge, the expertise, and the specialization that can serve the entire country. Or the world.

Saving the climate through better bureaucracy. New York’s law aims to put officials and experts in an optimal position to answer the questions that haven’t even come up yet. To that end, it creates a new sub-department under the New York Department of Buildings. While its precise mandate is still to be determined, this department will be outside the mayor’s office and fully integrated into the function of the city. “That’s the city sending a signal to building owners that this is something you need to manage, just like vacancy or rent,” Burt says.

The law also establishes an advisory board, with members appointed by the mayor and the city council, to evaluate several issues on an ongoing basis. The board will at times reconsider the per-square-foot carbon reduction goals for each of 10 building category types, from residential to hospitals to retail.
While the legislation has set standards for the first compliance period, there are still a lot of details to determine for the next phase (2030–2034), and the fine print will fall to the Department of Buildings, the advisory board, and the Mayor’s Office of Sustainability.

“For this [policy], the Department of Buildings is also the same department that has administered the benchmarking legislation and the audit requirements that have been in place, so I think that’s they were also chosen to administer this,” Robbins says. “Since this is a whole other level of oversight and decision-making, and paperwork and processes, that’s why they decided to create a whole new division and a new person to head that up, to make sure this legislation is successfully implemented.”

 

The city’s forthcoming Office of Building Energy and Emissions Performance will be headed up by a registered design professional, the legislation stipulates. No director has been named yet.

Still to come: Carbon cap-and-trade for buildings. One of the most formidable policy ideas in the bill also falls in the TBD category: It sets the stage for a carbon-trading market between buildings. It authorizes a study and guidelines for implementing a real-estate carbon market by 2021. If and when carbon trading comes to town, building owners could trade carbon-emissions credits in order to meet the cap. Owners of large portfolios could trade between their buildings to meet targets.

If New York’s policy is done right, carbon trading could serve low-income neighborhoods in particular. Extra credit could be given to upgrades performed in distressed areas, creating an incentive in areas that lack access to capital, whether the factor is 2-to-1, 3-to-1, or 10-to-1. Picture an ESCO—a Siemens or a FirstEnergy—meeting with building owners in low-income neighborhoods and offering do the building upgrades in exchange for the credits.“This creates an entirely different source of capital to finance efficiency upgrades in low-income neighborhoods,” Mandyck says.
 

“The overall importance of trading is that it’s globally relevant,” he adds. “It doesn’t matter what political system you have, what climate you’re in, what your building stock is. Building carbon trading can work anywhere in the world.”

There are still lingering questions that the Climate Mobilization Act hasn’t addressed. Some involve the carbon trading market: how those low-resource neighborhoods will engage in the carbon market shaping up around them, for example. Robbins notes that New York State has committed to a number of energy-efficiency investments; it’s unclear whether buildings owners can apply for these grants in order to meet New York City goals, or whether the state will deem them “free riders” for whatever political reasons.

Robbins also notes that an enormous chunk of New York City buildings were exempted from the guidelines. Any building with more than one rent-regulated housing unit will face a different regulatory path. If buildings with affordable housing—and this means buildings with any affordable housing—don’t comply with the carbon caps, they’ll face a list of “pre-set prescriptive measures,” Robbins says. A slap on the wrist compared to fines.

Residential buildings over 25,000 square feet with affordable units represent half the large buildings in New York. This means half of the applicable buildings won’t be required to meet the energy standards, which also means the other half will need to work that much harder to get to 40 percent by 2030 and 80 percent the following decade. New York lawmakers feared that the cost would be passed on to renters, or that rents on buildings might be raised to the point at which units are no longer considered rent stabilized.
“We understand the constraints and the reasons why rent-regulated housing was dealt with the way that it was,” Robbins says. “But that is such a huge swath of the multi-family buildings in this city, and it is a sector that we really want to see get the benefits of energy efficiency.”
There are other features of the bill that could produce big changes in industry. Mandyck notes that the law enables building owners to switch to renewable energy sources in order to get to compliance; currently, 70 percent of all electric energy use in New York City is generated through fossil fuels. He says that a renewable-energy credit will create a much higher demand for renewable energy in New York.
There are drawbacks to be addressed, too. Laurie Kerr, president of LK Policy Lab, a research and design institute for energy efficiency, says that it might be a mistake to set a single target for compliance in 2030. Rather than asking owners of half of New York’s buildings to hit a single deadline, the city might consider cascading annual targets for different building typologies.
But she praises the potential of a building-to-building carbon-trading market as a “least-cost path” for a bill that otherwise sets stringent targets for buildings. She points to a similar, smaller ordinance in Tokyo as a model for carbon trading.
New York’s bill is strict, she says; any degree of freedom for building owners is going to help.While the long runway and high benchmarks for success set by New York’s climate law makes it worth the trouble for building owners—and tenants, and providers, and consultants—it will still mark a huge shift for the city. The Real Estate Board of New York is joining forces with the Institute for Market Transformation, an energy-efficiency nonprofit, to provide training sessions to help the real-estate industry adjust.It could fail—it could fall to corruption, incompetence, or politics. Sweeping climate answers such as the Paris accords have demonstrated that they are vulnerable to populism and the slow-moving wheel of democratic consensus.

But if New York real estate and New York regulators can get it right? If a climate bill can work in New York, it can work anywhere.

“There was a time before cities had departments of sanitation. There was a time before cities had departments of health,” Kerr says. “These were all game-changers in the histories of cities. This is another turning point.”

By Kriston Capps

Demand for Luxury Home Hits Record Low in Nearby a Decade

Priciest properties in the United States are in far less demand this year, and that is taking a toll on their values. Sales of homes listed at $2 million and above fell 16 per cent in the first quarter, the sharpest annual decline since 2010, according to Redfin, a real estate brokerage.

This as the supply of those homes rose 14 per cent, marking four straight quarters of annual increases in inventory. The average price of a ‘luxury’ home, which Redfin defines as the top 5 per cent in each of the 1,000 cities it tracks, fell 1.6 per cent to $1.55 million.

Nonluxury homes saw their average price rise 2.7 per cent annually to $300,000.  Demand for high-end homes is waning in large part due to changes in tax law. The amount of state and local taxes that homeowners can deduct was capped at $10,000, and the mortgage interest deduction was reduced from $1 million to $750,000 in mortgage debt.

“Not only do the new rules make it less desirable to purchase a multi-million dollar home in high-tax states, it has also motivated some people—especially those with big incomes and big housing budgets—to consider moving to places like Florida, Washington or Nevada, which have no state income tax,” wrote Redfin’s chief economist, Daryl Fairweather, in a release.

The shift in the luxury market has been more pronounced, therefore, in certain metropolitan markets. The average luxury sale price fell hardest in Boston (-22.4%), Newport Beach, California (-21.8%), and Miami (-19.3%). Miami’s drop may have been less about tax changes and more about overbuilding on the luxury end in recent years that has led to an oversupply of high-end homes for sale. In Greenwich, Connecticut, home to the chiefs of some of the nation’s largest hedge funds, it is all about taxes.

“It can be significant,” said Jonathan Miller, CEO of Miller Samuel, a real estate analytics and appraisal firm. “You’re looking at 5, 6, 7 million-dollar properties that pay $100-$125,000 a year in taxes, and now you can only write off $10,000. What that does is impact value but it takes a while for buyers and sellers to agree on what that value is.” Greenwich sales in the first quarter of this year were down 25% compared with a year ago.

The median price fell 17% to just over $2 million, according to Miller Samuel. The average number of days homes sat on the market before selling rose to 214 and there is now a two-year supply of Greenwich homes for sale. “It’s a great buy right now, so my buyers are getting awesome deals,” said Jennifer Leahy, a real estate agent in the area with Douglas Elliman

. “I had a buyer who bought a house for $6.6 million that was on for $8.25 million, I have a buyer who got a house for $750,000 that was on for $900,000, so you get a deal in every price range right now.” CNBC.

Source: Daily Trust

Bilaad Realty to Champion Rent-to-Own Housing Scheme

A real estate developer, Bilaad Realty Nigeria Limited has said it has advanced plans to launch a rent-to-own housing scheme which is an alternative mortgage financing model that will help Nigerians own houses.

The Chief Executive Officer (CEO) of Bilaad, Mr. Aliyu Aliyu, dropped the hint when officials from Media Trust Limited, publishers of Daily Trust and other titles, paid the company a courtesy visit in Abuja recently.

Mr. Aliyu said the scheme which was still being worked out would offer people an alternative to current mortgage rates which were as high as 20 per cent and would give majority of Nigerians access to their own houses before they finished paying.

He said, “We know the government is doing quite a bit to address some of these concerns (housing finance), but we on our own part are trying to see how we can contribute to the solutions that exist and that is why we created a rent-to-own scheme.

We are still working on it and we look forward to seeing how the industry will fare better.”Bilaad Realty has three big ongoing projects in Abuja: Bobowasi Island, an estate located at Jabi, with 40 units of precious Garnet Home (4-bedroom townhouses each with one maid’s room).

One of the highlights of the estate is its proximity to the Jabi Lake. Two, the Bora Bora Island, an estate located at Wuye; it comprises of 63 precious homes of three different housing categories: Sapphire Home (5-bedroom villas each with one maid’s quarter), Ruby (4-bedroom townhouses each with one maid’s quarters), Topaz (3-bedroom apartments).

Three, Bali Island, which is a premium/mid-premium estate located in the heart of Kafe District, consisting of 411 units of seven different precious homes in a secure and serene environment. Aliyu said one of the projects would be ready by September, 2019, adding that each project handled by the company had its unique delivery period.

He said, “What we usually do is that, as a client who wants to own a house, we usually give a two-month delivery period from the time you pay to the time you to take your key. The interesting thing is that our payment plan is 18 months; which gives you flexibility to spread your payment pending when we are able to work out the rent-to-own system which will give you access to your house before you finish paying.

This is a model we are still working on.” He further said the company’s major projects were based in Abuja, but that there were plans for expansion. He added that, “Our next target is Lagos, Port Harcourt and Kano before we spread around.”

By Daniel Adugbo

Ministerial Panel Canvas for Urban, Regional Planning Tribunal to Tackle Violations

The Inter-Ministerial Committee set-up by the Minister of Science and Technology, Dr Ogbonnaya Onu has recommended the establishment of a functional urban and regional planning tribunal that would deal with all forms of violation in our building environment across the country.

The committee also recommended that an Executive Bill on National Building Code should be forwarded to the National Assembly for passage into law in order to regulate the conduct and operation of professionals and stakeholders in the construction industry.

Chairman of the Committee, Prof. Samson Duna while submitting its report to the minister on Friday in Abuja, said that frequent re-occurrence of collapse building in the country has become a national embarrassment where huge investments and valuables have been lost.

According to the chairman, the ugly incidents of building collapse have rendered many families homeless, individuals injured and causing psychological trauma to the affected families, stakeholders and of deep concern to Government at all levels.

He added that the National Building Code if passed into law would drastically reduce the invasion of building industry by quacks and non –building  professionals which contribute to majority of the recorded building collapses in Nigeria.

Earlier, Minister of Science and Technology, Ogbonnaya Onu said it is the responsibility of the government to ensure that human lives are secured, adding that the anguish and sorrow experienced by Nigerians due to building collapse should not be allowed to continue.

Onu further said that the recommendations of the committee will be utilized by the government to halt the recurring problem of building collapse.

He commended the committee for doing excellent job and coming up with viable recommendations to ensure safety of buildings and human lives in the country.

By Segun Olaniyi

Billionaire Marc Benioff Donates $30 Million to Research Homelessness

UC San Francisco launched a new research initiative aimed at discovering the root causes of homelessness — and solutions to end it — thanks to a $30 million gift from Salesforce (CRM) CEO Marc Benioff and his wife, Lynne.

The school announced the creation of the UCSF Benioff Homelessness and Housing Initiative on Wednesday.
“The world needs a North Star for truth on homelessness,” Benioff said in a statement.
 “The UCSF Benioff Homelessness and Housing Initiative will be that North Star, providing the latest research, data and evidence-based solutions to ensure we’re investing in programs that will help solve the homelessness crisis.”
Benioff, who was born and raised in San Francisco and is now CEO of the largest employer of the city, has been active on the issue in the past.
Last year, he pushed to promote Proposition C, which would tax large companies based in the city and use the money raised to address homelessness. The local ballot measure was passed by voters and is waiting to be validated in court.
“Homelessness isn’t just a Bay Area issue — it touches every community in California. Our entire state and nation have much to gain from this work,” California Gov. Gavin Newsom said in a statement.
Forget Bezos. Marc Benioff is having a moment “Marc and Lynne have been leaders in this space, and this generous investment will help fuel the search for solutions and further develop best practices to help those who are homeless improve their lives.”
Throughout America, a total of 552,830 people were experiencing homelessness on a single night in 2018, according to the National Alliance to End Homelessness.
On any given day that same year in California, more than 129,000 people were experiencing homelessness, according to the US Department of Housing and Urban Development.\
“Rising housing costs and income inequality are leading to more people, including families and older adults, entering homelessness for the first time,” UCSF said in a statement.
Margot Kushel, professor of medicine at UCSF and director of the UCSF Center for Vulnerable Populations, will lead the initiative.
“There is no medicine as powerful as housing. But the problem is complex,” Kushel said in a statement. “We know a lot about how to end homelessness, but that knowledge doesn’t always reach policymakers and is often not properly targeted. We have far more to learn about designing the most effective ways to prevent and end homelessness.”
By Amanda Jackson

Fashola Finally Releases List of Corrupt Contractors

Nigeria’s power, works and housing minister Babatunde Fashola has released names of firms that were contracted by the federal government on power projects but failed to deliver the projects.

Fashola listed the contractors in a letter to Socio-Economic Rights and Accountability Project (SERAP), who had consistently pressured the former Lagos State governor on the alleged corrupt contractors.

The minister in a letter with reference number FMP/LU/R2K/2016/T/40 signed by the permanent secretary of power ministry Louis O.N. Edozien listed the firms.

The letter said, “Pow Technologies Limited, an Abuja based company, was in 2014 awarded a contract for the supply and installation of test and maintenance equipment relays, etc to various NAPTIN regional training centers (RTCs) (LOT15), with the total contract sum of N87,763,302.40, out of which N79,404,892.66 was paid to Pow Technologies Limited.”

Fashola explained that the contracts were awarded in 2014, stating that only 13 of the 19 items have so far been supplied, with 6 items outstanding.

In the letter, the minister said different measures were being harnessed to ensure “completion of the project, address criminal breach of contract and take remedial action.”

The minister said that while the contractors undertook to take remedial action, they have failed to complete the project for which funds have been released.

He noted that it submitted a petition to Abuja police commissioner on 13th January 2016, and that the police instituted a case for the prosecution of Messrs Pow at the Upper Area Court.

The ministry also said it has sought and received legal advice to pursue a civil action at the FCT High Court while a report of criminal breach of contract has been made to the Economic and Financial Crimes Commission (EFCC).

In response, SERAP demanded additional information on the companies to deliver the projects they were contracted to deliver.

“We welcome Mr Fashola’s latest response and the information regarding Pow Technologies Limited. But we need details of names of other contractors that have collected public funds yet failed to execute power projects,” SERAP said in a tweet.

“We will continue to push the Ministry and its agencies to reveal more details of alleged corrupt contractors and companies, as contained in our FOI request.”

Prior to the disclosure, Fashola had told SERAP that “the Ministry has searched for the requested information on details of alleged contractors and companies that collected money for electricity projects and failed to executive any projects, but we could not find it from our records.”

 

But SERAP disagreed saying, “The public expectation is that government information, when in the hands of any public institutions and agencies, should be available to the public, as prescribed by the FOI Act. The FOI Act should always be used as an authority for disclosing information rather than withholding it.”

Fashola, however, promised to “refer the request for details of alleged contractors and companies that collected money for electricity projects and failed to executive any projects to the Ministry’s agencies for necessary action and appropriate response.”

He explained that “There may be instances of part-payment against certification of commensurate value for materials and services in achieved contract milestone even though the entire contract is not 100% performed.”

SERAP thereafter made an FOI request with suit number FHC/L/CS/105/19 filed in February at the Federal High Court, Lagos.

The suit is seeking “an order of mandamus directing and/or compelling Mr Fashola to provide specific details on the names and whereabouts of the contractors who collected public funds meant for electricity projects but disappeared with the money without executing any projects.”

By Dennis Erezi

Recurrent Expenditure takes 70% of Consolidated Revenue Fund inflow — FG

The Minister of Finance, Mrs Zainab Ahmed, disclosed this in a presentation made at a retreat on the Integrated Personnel and Payroll Information System.

The Consolidated Revenue Fund is an account that is owned and managed by the Federal Government, where all its revenues are paid.

The event, which was organised by the Office of the Accountant-General of the Federation, had as its theme, “The role of Ministries, Departments and Agencies in the implementation of IPPIS and its effect on workers condition of service and government revenue.”

The IPPIS scheme, which commenced in 2007, is one of the Federal Government’s reform initiatives designed to centralise payroll and payment systems, facilitate convenient workers’ remuneration with minimal wastage, aid manpower training and budgeting.

It also facilitates  planning, monitoring of the monthly payment of workers emoluments against what was provided for in the budget, ensures database integrity, facilitates easy storage, as well as updating and retrieval of personnel records for administrative and pension processes.

She described a situation where the 70 per cent of the Federal Government revenue was spent on recurrent as worrisome adding that if not corrected, it would not free the much-needed resources for improving the standard of living of the people.

She said that the concept of IPPIS was an integral part of the Federal Government’s public finance reform initiative aimed at ensuring transparency and reducing the cost of governance.

She said, “As part of the efforts of the present administration to enhance transparency and accountability in the management of public funds, the Federal Ministry of Finance is also implementing other initiatives aimed at ensuring efficient management of the cost of governance especially the recurrent expenditure of yearly budgets.

“The Economic Recovery and Growth Plan, a reform initiative of the Federal Government,  which aims at strengthening governance, accountability, reducing corruption and delivering services more effectively also plays an important role in the continued implementation of the IPPIS policy.

“It is expected that these reform initiatives will reduce the cost of governance. Presently, about 70 per cent of the monthly revenue inflow to the Consolidated Revenue Fund is being spent on recurrent expenditure; this trend will not free the much needed resources for improving our standard of living.

“The Federal Government is, however, determined to make life easier for the citizens despite the global economic challenges.”

The finance minister said through the successful execution of policies, projects and programmes enshrined in this year’s budget, massive jobs would be created.

She added that issues of insecurity, poverty and poor standard of living would be “faced squarely” through the implementation of programmes contained in the budget.

In his comments at the event, the Accountant-General of the Federation, Alhaji Ahmed Idris, noted that between 2017 and 2018, the sum of N197bn was saved from the removal of ghost workers from the government payroll.

Giving a breakdown of the N197bn, Ahmed explained that the sum of N67bn was saved in 2017 while the balance of N130bn was saved in the 2018 fiscal period.

He said through the implementation of the IPPIS initiative, over 700,000 government workers from 515 MDAs were now on the IPPIS platform.

He also said that 39 Nigeria Police Commands and three formations, four para-military agencies and Retired Heads of Service and Permanent Secretaries had been added to the platform.

This, he stated, was against 285 MDAs with over 235,000 workers in 2015.

Ahmed said the initiative was aimed at reducing wastage in personnel cost, facilitating easy storage, updating of personnel record and aiding manpower planning and budgeting.

The AGF said the successes recorded so far in the scheme were due to the political will of the administration of President Muhammadu Buhari.

He gave some of the successes of the initiative to include planning for personnel budget, reduction of the ghost workers syndrome, and easy retrieval of personal records.

He gave some of the challenges of the implementation of the initiative to include institutional resistance, lack of commitment from MDAs , and delay in the enrolment process, among others.

The Head of Civil Service of the Federation, Winifred Oyo-Ita, said that the introduction of the IPPIS had resulted in the reduction of the ghost workers’ syndrome, enforcement of compliance with due process on the employment of workers in the MDAs , and prompt and timely payment of salaries.

She said, “The IPPIS was introduced by the Federal Government in 2007 with a view to attaining transparency, accuracy and curtailing avoidable excesses in personnel costs.

“The payroll module has led to over N250bn being saved through the identification of ghost workers.

“Although the payroll platform was first introduced as a result of the urgent need to curtail ghost workers’ syndrome, it should, however, be noted that the personnel information is the basis for payrolling.”

By Ifeanyi Onuba

Diezani, Badeh, Fayose, Dasuki, Yuguda, 65 others forfeit 214 properties to FG

The real estate was recovered from over 70 individuals and seven firms who were prosecuted for various financial crimes, including money laundering.

A breakdown of the recoveries obtained by SUNDAY PUNCH on Friday, showed that 179 properties were recovered through interim forfeiture court orders.

Thirty-five of the properties have been finally forfeited to the commission while two, including a hotel belonging to Ima Niboro, former spokesman to ex-President Goodluck Jonathan, were returned voluntarily.

Other prominent Nigerians who lost their properties through court forfeiture orders include a former petroleum minister, Diezani Alison-Madueke; ex-National Security Adviser, Dasuki Sambo; former minister, Iyorchia Ayu; the late Chief of Defence Staff, Alex Badeh and a former Chief of Air Staff, Air Marshal Adesola Amosu (retd.)

Others were former Ekiti State Governor, Ayodele Fayose, ex-Bauchi State Governor, Isa Yuguda, Col. Bello Fadile (retd.) and a former Katsina State Governor, Ibrahim Shema who had 20 properties under interim forfeiture.

 

The list also included George Turner whose 17 properties in different parts of Bayelsa State were placed under interim forfeiture; former Niger State Governor, Babangida Aliyu and Garba Birni-kudu who had 14 properties under interim forfeiture.

 

Similarly, the commission recovered three properties, including a seven-storey building under construction in Gudu district, Abuja, belonging to one Emmanuel Ozigi and two others, while six properties located in different parts of Ibadan, Oyo State, were recovered from one Oni Ademola.

Five choice properties were recovered from Alison-Madueke; they include a multi-storey building on Banana Island, six flats in Ikoyi and 21 mixed housing in Yaba, Lagos; 16 terrace houses in Port Harcourt, Rivers State and 13 terrace duplexes in Mabushi, Abuja.

The anti-graft commission also obtained a final forfeiture order in respect of buildings in Ikorodu, Agege, Lagos-Ibadan Expressway; Cranbel Court, Citiview Estate, Arepo, which were recovered from Jamiu Anifowoshe and forfeited to the Lagos State Government.

Real estate consisting of seven buildings located on Obafemi Awolowo Way, Ikeja, Victoria Garden City, Ikota, Port Harcourt, Lekki and Utako, Abuja, were also recovered from Obasuyi Osasoghie and forfeited to First Bank Plc.

Between January and April, 2019, the EFCC had recovered N3.2bn (final forfeiture) from Amosu who paid N2.2bn; Olugbenga Gbadebo, N190.8m; Solomon Enterprise, N101m and Paul Boroh and 16 others, who coughed up N686.7m cash.

Last year, the agency recovered 141 vehicles; 44 bank accounts; one barge; farmland; four filling stations; two hotels and 47 parcels of land which were considered proceeds of crime.

By Adelani Adepegba

WEMPCO’s Debt, Exit Will Affect 19 Firms, 250, 000 Jobs

The current crisis facing the Western Metal Products Company has led to the closure of no fewer than 19 enamelware firms, while 250,000 jobs along the steel and enamelware value chain are also about to end,investigations by our correspondent have revealed.

WEMPCO is reportedly facing a huge debt burden of over N90bn, planning to sell its flagship five-star Oriental Hotel on the island and considering exiting Nigeria.

This may mean the end of its 700,000 tonnes-capacity steel plant.

Our correspondent gathered that the 40-year-old firm was the authorised sole distributor of cold-rolled iron sheet,  used in the manufacturing of roofing sheets and annealed iron sheets used in the manufacturing of enamelware.

The Central Bank of Nigeria, in order to protect the local manufacturers, had included cold rolled iron sheet and annealed in the list of 41 banned items from access to official foreign exchange.

The implication is that all the firms that produce roofing sheets and enamelware in Nigeria may have to shut down in the event of WEMPCO’s exit.

Already, all the firms manufacturing wheelbarrows and shovels are said to have shut down while others are winding down gradually having run out of stock of raw materials.

It was gathered that WEMPCO’s trouble stemmed from the influx of substandard roofing sheets smuggled into Nigeria from Cameroon and other neighbouring countries.

The local firms were said to have been mandated by the Standards Organisation of Nigeria to keep the standard of roofing sheet at 0.015mm in thickness.

This posed competition challenge against smuggled roofing sheets which were 0.013mm and 0.014mm.

The smuggled versions were also said to be preferred by buyers because they were cheaper.

Low patronage set in for WEMPCO and its stock of unsold products went bad from staying too long in storage.

By last year, the company had closed down almost all its plants as they were no longer producing.

Our correspondent also spoke to some of the buyers of WEMPCO products who recounted a different version of the story.

All of them, who spoke on condition of anonymity, said the firm was not consistent in filling orders.

It was alleged that they either took too long in delivering the product or delivered items different from the specification.

WEMPCO was also alleged to have abused the exclusive rights and waivers that were granted to it by the Federal Government.

Our correspondent learnt that whereas the previous government had granted the firm heavy waivers to aid it in production of cold-rolled sheet locally, the firm had instead embarked on heavy importation of the product.

Trouble started for it when the current administration came into power and decided to cancel the waivers.

It then became a Herculean task for WEMPCO to fill orders as the importation route had been closed and they could not produce to meet local demand.

Customers, who paid money into WEMPCO account, neither saw their money nor the goods they paid for. The bank held onto customers’ money because WEMPCO was heavily indebted to the bank, it was alleged.

When our correspondent sought an audience with Robert Tung, the Managing Director of WEMPCO, he declined the calls and did not respond to text messages sent to his line.

Our correspondent put a call through to a consultant to the firm, Jide Mike, but he denied ever working for WEMPCO; he also said he knew nothing about the company.

By Anna Okon

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