- New framework allows government to treat completed work as equity
- Revenue from house sales will be split between the government and private partner
- Deloitte Ghana will evaluate bids from multiple companies
President Nana Addo Dankwa Akufo-Addo has endorsed a new negotiation framework for the ongoing Saglemi Housing Project, following a proposal from Works and Housing Minister Kojo Oppong Nkrumah.
This approval allows for the commencement of negotiations with successful bidders after the completion of the evaluation process and the announcement of preferred bidders.
Under the new framework, the government will count the value of the work already completed as its equity stake in the project. Conversely, the cost to finalize the remaining work will be considered the equity contribution of the selected partner in a newly established Special Purpose Vehicle (SPV) dedicated to completing the project.
The framework also stipulates that revenue from house sales will be divided between the government and the private partner based on their respective shares in the SPV.
Originally intended to deliver 5,000 affordable housing units, the Saglemi Housing Project received about $200 million in government funding but only 1,506 units were partially finished. The project was suspended due to missing infrastructure, including water, electricity, and sanitation facilities.
The Ghana Institute of Surveyors has assessed the project and determined an additional $100 million is required to complete it—funds the government is unable to provide. Consequently, the Cabinet has authorized the pursuit of private-sector financing and expertise, issuing a Request for Proposals (RFP) in April 2024.
Deloitte Ghana was appointed as the Transaction Advisor to ensure a transparent evaluation of bids from Afro-Arab Properties Ltd, Quarm-LMI Consortium, Dredge Masters-Titanium, Broll Ghana Ltd, and Masiltin Group, with evaluations completed by July 8, 2024.
The Transaction Advisor is expected to recommend the preferred bidder(s) to the Ministry of Works and Housing by mid-September, after which negotiations will start to finalize the terms for the joint venture. The SPV will oversee the construction and operationalization of the remaining 1,506 housing units.
