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News > Private Equity > Deals

Futuregrowth invests in GPF

Anna Lyudvig
June 18, 2018, 9:46 p.m.

Word count: 457

Futuregrowth Asset Management has committed R250m of senior debt to the Gauteng Partnership Fund (GPF), which will be used to fund developments in the student housing market in Johannesburg. 

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Futuregrowth Asset Management has committed R250m of senior debt to the Gauteng Partnership Fund (GPF), which will be used to fund developments in the student housing market in Johannesburg. 

The investment complements the GPF’s junior debt and the property developer’s own equity investment into these developments.

Established by the Gauteng Department of Human Settlements in 2002, the GPF remains committed to its vision to be “the partner of choice in affordable housing delivery in Gauteng”. 

Partnerships between the GPF and funding providers in both the public and private sector assist the GPF in meeting its objective of rolling out good quality affordable housing and student accommodation developments across Gauteng. 

Thina Manga, Investment Analyst at Futuregrowth Asset Management, said: “The GPF and Futuregrowth joint-funding arrangement is a prime example of the private and public sector working together to fund developments in the affordable housing and student accommodation market.”

“The spate of student protest action witnessed in recent years has brought to the fore the plight of many students, particularly those coming from disadvantaged backgrounds. The problematic administration and abuse of financial aid schemes over the years has led to many deserving students not being able to access this sources of funding,” she said.

“Further along the income spectrum we find the so called “missing middle”; the students from lower to middle class families who “are deemed too rich to qualify for government support, but too poor to afford tuition fees”,” she added.

In 2011, the Department of Higher Education and Training (DHET) conducted a study which revealed the 70 of the shortage in on- and off-campus student accommodation at South Africa’s public tertiary institutions.

This new development will accommodate 119 students in a combination of single and double occupancy rooms within a 5km distance from both NWU and VUT. 

Bedworth Park, the residential suburb in which Varsity Lofts is situated, has a mixture of well-maintained, refurbished and vacant properties, and has amenities and public services within close proximity. 

Students who, in desperation, may have had to take up accommodation in unsuitable and/or unsafe conditions are now being offered the opportunity to stay close to campus in a secure residence that fosters learning. 

By pooling skills and resources, Futuregrowth and the GPF have the opportunity to deliver accommodation that supports the academic progress of students who have limited financial means, Manga said.

She added that Futuregrowth’s partnership with the GPF is one of the many successful instances of the public and private sector coming together and working diligently towards achieving a common goal on commercial terms.

“The investments made by Futuregrowth are always underpinned by our fiduciary duty to our clients, to generate risk-adjusted commercial returns on the funds invested,” she said.

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Africa Global Funds (AGF) is a monthly magazine for asset management professionals and institutional investors worldwide interested in the African continent. AGF was created as a relevant and engaging resource that can provide readers with an insight of what is going on in the African asset management space. Drawing on an intense dialogue with a constantly expanding group of key decision-makers in the industry, we cover traditional and alternative asset classes of African asset management. From this dialogue we work hard to produce a compelling blend of hard news, incisive commentary, detailed sector and regional reports, exclusive interviews and proprietary data.

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