Home » General » Fidelity Life Starts Allocating Stands

FIDELITY Life says it is well on course to start allocation of housing stands under its Southview Park project this month with servicing of the stands set for completion by year end.

This comes after the group raised a total of $12,6 million from a bond issue to fund development of key infrastructure for the residential stands project located southwest of Harare.

Fidelity created a special purpose vehicle, Athena Estates, specifically for the purposes of mobilising the financial resources required for the Southview Park residential stands development.

Fully paid up or 50 percent paid-up home seekers will get priority in the allocation of the stands. Under the first option prospective home owners make a minimum deposit of $3 750 and clear the balance over 10 years.

If paid over five years, instalments will be $185,91 per month or $115,63 over five years. Under the second option, the deposit is $5 750 at $143 per month over five years or $89,20 over 10 years.

The life insurance and financial services provider expects to generate a $34 million from the sale of the about 6 000 stands from a land area spanning 328 hectares purchased from CFI Holdings.

Chief executive Mr Simon Chapereka said in an interview that following overwhelming interest in its $5 million bond, Fidelity sought permission to accept all the offers.

He said that interest to subscribe for the bond reached $12,6 million and the company asked Government to be allowed to retain all of the offers, which the Government duly granted.

“The amount (offers) came to $12,6 million. We then approached Government through our regulator (IPEC) to be allowed to keep everything and the request was granted,” Mr Chapereka said.

The bond, which targeted insurers, pension funds and other institutional investors, was accorded prescribed asset status by Finance and Economic Development Minister Patrick Chinamasa.

Funds from the bond were meant for key infrastructure such as an 11 kilometre (500mm) bulk water pipeline at a cost of $2,675 million and elevated bulk water tanks for about $2,35 million.

Initially, Fidelity planned to execute the project over a period of 24 months, but reviewed the completion period to 18 months and expects to finish servicing of the stands by end of this year.

The project is divided into three phases and allocation of stands this month will be done under the first phase.

Mr Chapereka said the list of the first beneficiaries had been submitted to him, but he had directed that a few issues he was not happy with be addressed before the stands allocation started.

“We said allocation will be on a first come first served basis, but if people paid 100 percent or 50 percent, they would gravitate higher in terms of allocation of the stands,” Mr Chapereka said.

Fidelity expects to generate net profit of $21,5 million profit from the sale of the Southview Park housing stands, which could take profitability to over $30 million in view of current profitability.

Government prioritises housing development under its medium-term policy, the Zimbabwe Agenda for Sustainable Socio-Economic Transformation as Zimbabwe faces a huge housing backlog, estimated at over 1,25 million units.

Source : The Herald