The National Social Security Fund (NSSF) has commissioned construction of its Shs14.5bn housing project in Mbuya, a high end residential area in Kampala, in its continued effort to expand its real estate investment portfolio to deliver value to its members.
The project comprises of 40 high end, 3 bedroom apartments, and other amenities such as a club house, swimming pool and landscaped gardens. This is the second project the Fund is constructing in Mbuya, after 6 high end apartments were constructed and sold in 2012.
Addressing guests at the groundbreaking ceremony today, NSSF Managing Director, Richard Byarugaba said that the Mbuya project reinforces the Fund’s strategy to diversify its investment portfolio as well as implementing planned real estate projects.
“We are making significant progress in real estate in line with our mandate to create value for our members. Projects such as this one we have started in Mbuya give us a better opportunity to give NSSF members a reasonable and consistent return on their savings. The project will be completed in about 24 months and we project to earn a return of about 20% on our investment,” Byarugaba said.
“The project will enable NSSF to continue to diversify its revenue streams thereby minimizing any risks within its asset classes. It will also create hundreds of direct jobs for both the skilled and semi-skilled Ugandan youth living in Kampala and beyond, thereby reducing the unemployment burden of the country,” he added.
The Mbuya housing project comes a month after the Fund kick started a mixed development project in Jinja town worth Ushs 3.3 billion.
Byarugaba added that the housing project in Mbuya is in response to a housing deficit and lack of adequate and well-planned real estate in Kampala- an investment opportunity that the Fund has identified.
“Once complete, the estate will provide accessible first-class residential apartments. Ugandans are hungry for property in planned housing projects and we hope that this estate will be a model that can be replicated elsewhere in Uganda. We are keen to launch all our planed housing projects because we have deliberately chosen to be the solution to Kampala’s housing deficit problem,” he added.
Each apartment will occupy an approximate gross floor area of 160 m² with 3 bedrooms, the master bedroom en-suite with both a bath tub and a shower and the other 2 bedrooms sharing a bathroom, lounge opening to a terrace, dining room, kitchen, drying yard and servant quarters.
Mr. Patrick Byabakama Kaberenge, the NSSF Board Chairman noted that the new venture is in line with NSSF’s real estate investment strategy and the Fund’s 10-Year Strategic plan.
“By the end of this year alone, the Fund would have invested close to Ushs 578 billion in real estate projects in Uganda,” Mr Kaberenge said.
Other real estate projects that the Fund plans to undertake include Lubowa Housing Project, Pension Towers and the Off-Taker Housing Project.
“As a Board, we committed to supporting Management to kick start real estate projects that have stalled. The fact that the Fund has launched 2 significant projects in just a month is testimony that my Board is delivering on our commitment,” he said.
He further explained that the Fund aims to reduce its portfolio risk by having a well-balanced and diversified portfolio in line with its Investment Policy. As at December 2015, the Fund’s Fixed Income investments stood at 76.9% of our total assets, Equity was at 15.3% and Real estate followed at 7.8%.
Today, its total assets stand at Ushs6.25 trillion up from Ushs5.975 trillion in December 2015.