Bahrain firms in a bid to meet affordable housing demand
Key Bahrain-based companies are leading the way in meeting the affordable housing challenge, and setting a leading example for all countries across the Middle East and North Africa (MENA) region. As the Bahraini government is faced with a growing shortfall of affordable housing, currently estimated at 40,000 units, it must react quickly and efficiently to meet the soaring demand. However, as many question the efficacy of relying on the public sector to deliver the required housing, major Bahrain-based companies have come together to develop a blueprint for planning, financing, delivering and managing housing delivery - both within the Kingdom and across the wider MENA region. Financing affordable housing schemes remains one of the biggest challenges to delivering housing in the region.
As access to traditional sources of finance remains difficult in the wake of the renewed global financial crisis and increasing nervousness in the markets, one Bahrain-based firm is looking at examining alternative financing structures in order to ensure housing delivery even in today's market. Naseej, a Bahrain-based company, has been discussing a public-private partnership with the government - a potential partnership that would ensure the timely delivery of 4,000 homes, designed specifically for the resident Bahraini population. "It is clear that the working and dynamic partnerships between governments and developers is the way forward in delivering affordable housing to the region," said Christopher Sims, CEO, Naseej. Another major challenge to affordable housing delivery and take-up is the existing provision of 'affordable' housing.
Many developers have delivered low-cost housing, which did not attract buyers, lost tenants and resulted in marginal profits for the company, and unsustainable communities for the region. Diyar Al Muharraq, a regional developer based in Bahrain, is driving low-cost, high-quality and relevant developments.
New master-planning, design and construction techniques are also being pioneered by companies in Bahrain and across the region. Underpinning the success of affordable housing delivery is the critical access to sustainable housing finance, or mortgage schemes. Sakana Holistic Housing Solutions, a regional pioneer of the nascent mortgage market in Bahrain, sees Governmental regulation as key to developing more advanced housing finance solutions. "There is enormous demand for sustainable mortgage schemes across the MENA region," said Sakana's CEO R. Lakshmanan. "However, the lack of developed regulations, advanced capital markets to provide liquidity, and funding is hampering the development of the market, and in turn, restricting access to housing, especially affordable housing. "Local governments are gradually developing the appropriate regulation, and once these are in place, we foresee double-digit growth for the region's mortgage market." While there is significant work yet to be done to meet the looming 40,000 units of required affordable housing in Bahrain, the innovative and committed projects being launched by Bahrain's private sector community will ensure that the country continues to lead the way in meeting its affordable housing requirement.