President Nana Addo Dankwa Akufo-Addo has given the go-ahead for a framework to guide negotiations with the successful bidder(s) in the ongoing efforts to resolve the Saglemi Housing Project.
The framework approval follows a request from the Minister for Works and Housing, Kojo Oppong Nkrumah.
Sources familiar with the matter indicate that under this framework, the current value of the work completed at Saglemi will be considered as the government’s equity in the project.
Meanwhile, the cost to complete the remaining work will be regarded as the equity contribution of the selected private partner in a Special Purpose Vehicle (SPV) that will be established to complete the project.
Once the housing units are completed, the proceeds from their sale will be distributed between the government and the private partner based on their respective equity stakes in the SPV.
The Saglemi Housing Project, originally intended to deliver 5,000 affordable housing units, received approximately $200 million in government funding.
However, by the time the project was halted, only 1,506 units were partially completed, and they were deemed uninhabitable due to a lack of essential infrastructure, including water, electricity, and sanitation.
A valuation conducted by the Ghana Institute of Surveyors estimated that an additional $100 million would be needed to complete the 1,506 unfinished units—a sum the government could not provide.
As a result, the Cabinet approved the pursuit of private-sector financing and technical expertise to complete the project. In April this year, a Request for Proposals (RFP) was issued to achieve this goal.
To ensure a transparent and fair process, the government engaged Deloitte Ghana as the Transaction Advisor.
Deloitte was tasked with evaluating bids submitted by Afro-Arab Properties Ltd, Quarm-LMI Consortium, Dredge Masters-Titanium, Broll Ghana Ltd, and Masiltin Group by July 8, 2024.
The Transaction Advisor is expected to present the preferred bidder(s) to the Ministry of Works and Housing by mid-September.
Once the preferred bidder(s) are selected, the government will enter negotiations to establish terms for creating a Joint Venture between the two parties.
The SPV formed through this partnership will be responsible for completing and operationalizing the 1,506 housing units.
With the President’s approval of the framework, the path is now clear for negotiations to commence once the evaluation process concludes and the preferred bidder(s) are identified.
