The Ghanaian government has taken a decisive step toward addressing the country’s long-standing housing crisis by selecting Quarm-LMI as the preferred developer to complete the stalled Saglemi Housing Project. This announcement, made via a press release from the Ministry of Works and Housing on Friday, October 18, 2024, comes after an extensive negotiation process involving several key government bodies and independent technical experts.
The negotiation, which spanned several months, saw a team comprised of representatives from the Ministry of Finance, the Office of the Attorney General and the Ministry of Justice, and Deloitte working closely with the Ghana Institute of Surveyors. Their goal was to find a sustainable solution to restart the project and bring much-needed relief to the country’s housing deficit. With Quarm-LMI now at the helm, the government has indicated that the redevelopment will be executed through a Special Purpose Vehicle (SPV). This innovative financing structure treats the government’s previous investment in the project as equity, allowing both the government and the developer to recover their funds once the project is fully completed.
Originally launched with the ambition of delivering 5,000 affordable housing units, the Saglemi Housing Project has long been seen as a critical component in the government’s efforts to provide decent housing for Ghanaians. The project, which received approximately $200 million in government financing, came to a halt after only 1,506 units had been partially constructed. However, these units were left uninhabitable due to the absence of crucial infrastructure such as water, electricity, and sanitation. This stalled development created a significant gap between the project’s potential and its current state.
In response to the incomplete nature of the housing units, a subsequent valuation was conducted by the Ghana Institute of Surveyors. Their report estimated that an additional $100 million would be required to fully complete the 1,506 unfinished units, a financial burden the government could not shoulder at the time. As a result, the project remained in limbo, further aggravating the country’s housing deficit, which currently stands at an alarming 1.8 million units.
With Quarm-LMI now tasked with the responsibility of seeing the project through to completion, there is renewed hope that the Saglemi Housing Project can finally achieve its intended purpose. Both the government and Quarm-LMI have expressed their commitment to ensuring that the project is completed to a standard that will meet the housing needs of thousands of Ghanaians. The collaboration between the public and private sectors, structured through the SPV, ensures that both parties will recover their investments, a key aspect of the deal that provides long-term financial security for all stakeholders involved.
The government’s decision to treat its current investment in the project as equity is a crucial move, allowing it to maintain a stake in the development without having to inject further funds upfront. This approach not only safeguards the government’s previous financial commitments but also ensures that Quarm-LMI can focus on delivering the necessary infrastructure upgrades to make the housing units habitable.
The completion of the Saglemi Housing Project will have far-reaching effects on the nation’s housing landscape. By providing affordable housing to thousands of citizens, it will contribute significantly to reducing the housing deficit, a pressing issue that has left millions of Ghanaians without proper accommodation. The project’s successful revival will also set a precedent for future housing developments, showcasing how public-private partnerships can be leveraged to solve large-scale infrastructure challenges.
Moreover, the involvement of institutions like the Ghana Institute of Surveyors in providing technical evaluation support highlights the importance of expertise and due diligence in large-scale development projects. The accurate valuation of the remaining work required for the Saglemi units ensures that the project’s completion will be financially feasible, avoiding the pitfalls of underfunding that stalled the project in the first place.
In summary, the selection of Quarm-LMI as the developer to complete the Saglemi Housing Project marks a significant milestone in the government’s efforts to address the country’s housing shortage. With a clear financial plan in place and a commitment to collaboration between the public and private sectors, there is optimism that the project will soon provide much-needed homes for thousands of Ghanaians. This development brings renewed hope that the housing deficit, which has plagued the nation for years, may finally begin to decrease, providing a brighter future for those in need of affordable, decent housing.
