President Akufo-Addo Endorses Framework for Saglemi Housing Project Negotiations

President Nana Addo Dankwa Akufo-Addo has endorsed a framework to facilitate negotiations with the successful bidder(s) in the protracted Saglemi Housing Project. This approval, granted at the request of the Minister for Works and Housing, Kojo Oppong Nkrumah, marks a critical step toward resolving a development that has been marred by delays and funding shortfalls.

Under the newly sanctioned framework, the value of the completed portions of the Saglemi project will be classified as the government’s equity in a Special Purpose Vehicle (SPV) to be established. The private sector partner selected through this process will contribute the additional funds required to finish the remaining work, with these costs constituting their equity stake in the SPV. Revenues generated from the sale of the completed housing units will be apportioned between the government and the private partner in accordance with their respective equity shares in the venture.

 

The Saglemi Housing Project, originally envisioned to deliver 5,000 affordable housing units, has seen only 1,506 units partially completed despite the injection of approximately $200 million in government financing. Progress on the project has been stymied by the absence of crucial infrastructure, including water, electricity, and sanitation systems.

A valuation by the Ghana Institute of Surveyors has estimated that an additional $100 million is necessary to complete the remaining units—a financial burden the government has been unable to shoulder. As a result, the Cabinet approved a shift towards private-sector financing and expertise, issuing a Request for Proposals (RFP) in April 2024.

To ensure transparency and integrity in the selection process, Deloitte Ghana was appointed as the Transaction Advisor. The firm is currently evaluating bids from Afro-Arab Properties Ltd, Quarm-LMI Consortium, Dredge Masters-Titanium, Broll Ghana Ltd, and Masiltin Group, with the preferred bidder(s) expected to be announced by mid-September. Subsequent negotiations will focus on finalizing the terms for the creation of the SPV, which will be tasked with the completion and commercialization of the 1,506 housing units.

 

President Akufo-Addo’s approval of this framework is a pivotal development, enabling the government to move forward with negotiations once the evaluation process concludes, and a private partner is selected. The outcome of this process is seen as a litmus test for the government’s broader strategy to leverage private capital for public infrastructure projects.

Source:norvanreports.com