Home / News  / How the Jobs Fund-TUHF partnership has ignited the inner-city rental space

How the Jobs Fund-TUHF partnership has ignited the inner-city rental space

THUF resize

The Jobs Fund (JF), a R9bn facility set up by government in 2011 to co-finance public, private and non-government projects for the purposes of job creation, partnered with TUHF Limited (TUHF) in 2015 in a move to ignite development in inner cities across South Africa. The programme encourages entrepreneurs to transform old buildings into residential homes.

By March 2018 the partnership had succeeded in creating 2,411 new permanent jobs and 5,126 short-term jobs in inner cities across the country.

TUHF is an on-lending financial services provider that provides access to finance for entrepreneurs and small and medium enterprises (SMEs) to purchase, and subsequently convert or refurbish buildings in the inner cities of South Africa into affordable residential rental units.


Solly.resized

Why Solly left the police to become a successful property investor


“This partnership has succeeded in addressing two key development challenges faced by South Africa, namely access to finance for budding property entrepreneurs as well as decent and affordable accommodation close to places of economic opportunity,” said Najwah Allie-Edries, head of the Pretoria-based JF. “In addition, it has also addressed a third challenge, unemployment, by creating a number of jobs in areas that are facing a constant influx of new job seekers.”

In its 13 years of existence TUHF has financed over R4bn in inner city residential rental property and currently has a loan book holding over 34,000 residential units. Entrepreneurs are screened using TUHF’s well-developed character-based assessment method which takes into account the entrepreneurs’ ability to find, develop and manage properties that will enable them to build thriving property enterprises.

The TUHF prides itself on its hands-on approach and specialised knowledge of the complexities of inner cities which allows it to take on the risk of financing the purchase, construction and management of affordable rental housing by private entrepreneurs in areas marred by urban decline. It also assists with the capacity building and up-skilling of SMEs through training interventions such as the TUHF Programme for Property Entrepreneurs (TPPE) training sessions which are facilitated and accredited by the University of Cape Town. These classes leverage the knowledge of industry experts to educate entrepreneurs on construction-related topics and provide them with practical skills that they can utilise in managing and growing their property businesses.

 

“One of our main objectives in providing the grant was to enable TUHF to secure additional sources of funding from capital markets, which in turn boosts its ability to finance a greater number of entrepreneurs,” said Allie-Edries. “We far exceeded our objective in that not only have we showcased the ability to change market behaviour by encouraging investment in redlined inner city properties, but we have also highlighted the powerful role that on-lending can play in the development space.

“On-lending presents an opportunity to facilitate the flow of the much-needed funds from the large pool of capital available to SMEs, who are expected to be the significant contributors to job creation. On-lenders, who are niche market intermediaries, use their niche expertise to leverage funds and make these funds available to entrepreneurs who cannot access commercial funding.”

hometimes@pixelbaste.com

Review overview
NO COMMENTS

POST A COMMENT