RealCAPITA developing a €350 million affordable housing project in the North African market with the aim of developing similar schemes in Bahrain

Bahrain based RealCAPITA a newly formulated Real Estate Investment company with a paid up capital of US$ 54 million, has paired up with a Moroccan partner “Jet Group” a real estate developer based in Casablanca to undertake the development of a €350 million affordable housing project in several cities in Morocco. The partnership established was formalised by Mr. Mohammed Al- Tawash (Vice Chairman & President of RealCAPITA) and Karim Amour (President of Jet Group). The new partnership is believed to be ideally positioned to capture investment opportunities both in the current housing market upturn and the anticipated growth in future years to come. RealCAPITA’s mandate is to invest in the GCC and well as other emerging markets (Far East, Eastern Europe and North Africa). This recent venture into the affordable housing market is a manifestation of RealCAPITA’s core values, as mentioned by Mr Al-Tawash “affordable housing creates real wealth in society by offering the lower end of market access to significant real estate wealth”. With this in mind, the partnership will develop over 16,000 affordable housing units within secured gated communities, spread across Morocco (Casablanca, Agadir Marrakech, Tangier, Nador, and Tetouan). RealCAPITA is promoting a €50 million fund to undertake such development.

Today, Jet Group is among the most specialized affordable housing developers and property management companies in Morocco with several similar projects in its track record. Additionally Jet Group is recognized as the only quality certified affordable housing developer in Morocco with an ‘ISO 9000’ licence as well as being the recipient of the Moroccan’s Kings Award of Excellence in affordable housing.

The economic growth in the region is creating huge demands for in the residential market. This has pushed up house prices throughout the region, which has in turn lead to a concentration of high-end property development while neglecting the low-to-mid end of the market. This is a serious shortfall especially considering that the lower end of market is larger in terms of size and includes a significant portion of the labour force which drives almost every sector in the economy.

As cities expand in terms of area and population, it not surprising that the MENA region suffers from a shortage of permanent affordable homes for the low-to-mid income families. Such a gap coupled with the limited scale of housing assistance programs can ultimately lead to several social problems.

Mr. Al-Tawash emphasised that “at RealCAPITA we want our housing strategy to paint a clear picture of how we plan to tackle the primary housing problems faced by middle and lower income families in the region. At the same time we need to ensue minimum quality in the living environment and work with others to maximise the utilisation of space”.

Mr. Qais Al-Maskati, RealCAPITA’s Vice President of Investment mentioned, "with today's rapid growth and urbanization of Morocco, privatized housing schemes have been the answer to keep in pace of such development. This €350 million euro based project will aim to complete 16,000 housing units within approximately 4 years, yet the first units of houses will be delivered as early as 12 months time”.

Mr. Al-Maskati continued to highlight that this project is socially responsible for eliminating shanty towns in Morocco and will have a knock-on effect in reducing noise pollution, environmental pollution and crime rates. These factors are detrimental to the image of any city both to its citizens and potential investors.

With the acceptance that businesses can only thrive if low-to-mid income individuals can afford to live in either their immediate communities, or within easy commuting distance, together with the attractive returns that the project company will be able to generate, “it is not surprising to witness positive reactions to the project” said Mr. Al-Maskati. Especially when taking into consideration all the government incentives offered to affordable housing developers such as tax exemptions and mortgage guarantees to encourage the banking sector to extend mortgage loans to the end users. In line with this, the local finance sector in Morocco is considered to be corporative as they make available both project financing for the developers as well as mortgage financing for the end users even those who do not have a fixed income and are self employed.

Taking heed from the affordable housing initiatives undertaking in Morocco, Mr. Al-Tawash stated that “Bahrain too needs to encourage the participation of the private sector in the affordable housing sector in Bahrain, as the need for the ever growing population increases”. Together with government and political will, RealCAPITA is enthusiastic to become a strong supporter in the development of Bahrain’s affordable housing projects, as government incentives can encourage the development of more affordable housing in an effort to open the market up to lower-income families and first-time buyers.

RealCAPITA’s core strategy is grounded in understanding real estate fundamentals and transacting sound deals based on this knowledge. This strategy is vital for surviving the highly competitive operating environment which favours institutions with superior knowledge, resources and value added capabilities. With an authorized capital of US$200 million, and a paid up capital of US$54 million, RealCAPITA is one of the largest institutions of its kind in the region. Strategic investors in RealCAPITA include some of the biggest names in the region, namely, Manama-based Al-Khuzama Investments, Abu Dhabi-based Injaz Mina Investment Bank, Riyadh-based Al Rajhi Investment Group, Doha-based International Trade and Development Company, Saudi Arabian based Dammam Development, Abu Dhabi-based Ali and Sons, Manama based Gulf Amwal Investments, and Kuwiat based Global Investment House.

<< Back to PRESS

<< Back to MAIN