When discussing the real estate sector in Tanzania, Watumishi Housing Investments (WHI) often comes to mind as a significant player. As a key property developer and fund manager, WHI is instrumental in advancing the national agenda to reduce the shortage of affordable housing in Tanzania. In a recent interview with our staff writer, Exuperius Kachenje, WHI’s CEO, Dr. Fred Msemwa, highlighted that the organization has achieved substantial growth, increasing by 26bn/=
Watumishi Housing Investments (WHI) was established under the Companies Act (Cap 212) of 2002. WHI’s primary objective is to provide public employees and pension fund members with the opportunity to own affordable houses and serviced plots. This goal aligns with national and international objectives, including the National Human Settlements Development Policy (2000), Development Vision 2025, and the Sustainable Development Goals 2030 (SDGs).
Historically, houses built by developers, including the government, were often unaffordable for many due to high prices and the limited purchasing power of low-income earners. Recognizing this gap, the government established WHI to serve low-income groups that could not afford high-interest bank loans. Our mission is to bridge this gap by creating accessible housing opportunities for all Tanzanians, ensuring that the dream of home ownership is within reach.
WHI’s investors comprise a range of institutional investors. Initially, the investment structure was designed to mobilize funds for constructing houses through a Real Estate Investment Trust (REIT) with key investors being pension funds by then such as LAPF, GEPF, PPF, PSPF, NHIF, NSSF, and the National Housing Corporation (NHC), which now we have PSSSF, NSSF, NHIF and NHC.
Institutional investors, particularly pension funds, were key to understanding and supporting WHI’s mission. These institutions were the first to inject capital, contributing an initial 57bn/-. This funding allowed us to strategically acquire land for housing projects across 11 regions, including Dar es Salaam, Tanga, Lindi, Singida, Mtwara, Morogoro, Dodoma, and Mwanza e.t.c.,. This strategic acquisition enabled us to lay the groundwork for affordable housing developments in these key areas.
A portion of the 57bn/- was allocated to constructing houses in the Dar es Salaam, Morogoro, Dodoma, and Mwanza regions. To date, we have built around 1,000 houses, which have been sold to public servants and other intended groups. This strategy has been in place for the past ten years, reflecting our commitment to providing long-term housing solutions for Tanzanians.
Since our establishment, WHI has witnessed significant growth, both in terms of financial assets and impact on the housing sector. Our initial capital of 57bn/- has grown to 83bn/-, marking an impressive 26bn/- increase. This growth underscores our ability to efficiently manage resources and deliver on our promise of affordable housing.
This financial growth is not just a numerical milestone; it is a testament to the trust our investors place in us and the effectiveness of our strategic initiatives. It also highlights our role in driving economic growth within Tanzania, as we continue to expand our reach and impact through various housing projects and investment opportunities.
We’ve found that middle- and low-income earners often cannot afford houses priced at 50m/- or 60m/- or meet a 10% deposit requirement. To address this, we established the Faida Fund, an open-ended scheme designed to create wealth for Tanzanians, especially those in middle- and low-income groups. Through investments in units, the fund aims to offer competitive returns through capital growth and to encourage a culture of savings in financial assets.
The Faida Fund targets both investors and ordinary citizens who wish to grow their wealth, allowing them to start with a minimum investment of 10,000/- to open an account and subsequent investments starting at 5,000/-. This platform enables people to save not just for housing but also for other business ventures, they may pursue. Investors can withdraw funds as needed for various purposes without restrictions.
Additionally, we offer a junior account for parents wanting to save for their children’s future. For instance, investing 20,000/- monthly for a three-year-old child can accumulate substantial savings by the time they reach university age, eliminating the need for student loans and allowing the funds to cover educational expenses.
The Faida Fund is a cornerstone of our efforts to enhance financial inclusion and empower Tanzanians to participate in wealth-building activities. By offering an accessible entry point into the investment market, the fund allows individuals to accumulate wealth over time, even with modest initial investments.
The structure of the Faida Fund is tailored to support long-term growth, providing investors with the flexibility to make additional contributions or withdrawals as needed. This flexibility is particularly valuable for those who wish to use their investments for purposes beyond housing, such as starting a business or funding educational pursuits.
The fund’s open-ended nature means that it is continuously open to new investors, allowing more Tanzanians to benefit from capital growth opportunities. As the fund grows, it not only delivers returns to investors but also contributes to the overall stability and growth of the Tanzanian financial market.
To date, Watumishi Housing Investment has refunded 2.6bn/- to investors and distributed 1bn/- as dividends. This reflects our commitment to providing tangible benefits to those who invest with us and reinforces our position as a reliable investment partner.
Beyond investor returns, WHI also plays a significant role in contributing to the Tanzanian economy through Corporate Social Responsibility (CSR) initiatives. We make substantial contributions to the government as part of our CSR commitments, supporting projects that drive social and economic development in the communities we serve.
Our CSR efforts are diverse, ranging from community development projects to environmental conservation initiatives. By aligning our business goals with societal needs, we aim to make a lasting positive impact on Tanzanian society.
Our future growth strategy focuses on expanding our project portfolio to include more regions and diversifying our housing options to cater to various income levels. We aim to enhance our investment platforms, making them more accessible and attractive to both local and international investors. By leveraging technology and innovative construction methods, we intend to increase efficiency and reduce costs, further enhancing our ability to provide affordable housing solutions.
In addition to our housing projects, we are committed to exploring sustainable development practices that align with global environmental standards. Our goal is to ensure that our projects contribute positively to environmental conservation while meeting the housing needs of Tanzanians.
The Junior Account initiative is a forward-thinking program designed to help parents and guardians save for their children’s future. By allowing parents to invest as little as 20,000/- monthly, the Junior Account accumulates funds that can be used for educational expenses, such as university tuition, without the need for student loans.
This initiative not only eases the financial burden on families but also instills a savings culture in future generations. As children grow, they witness the tangible benefits of disciplined financial planning, equipping them with valuable skills for managing their finances in adulthood. The Junior Account represents our commitment to long-term financial education and empowerment for Tanzanian families.
Looking ahead, WHI plans to expand its housing projects to cover more regions across Tanzania, aiming to reach underserved areas where affordable housing is most needed. We are exploring partnerships with local governments and private sector players to enhance our reach and impact.
Our services will also diversify, offering a range of housing solutions tailored to different demographic needs. From high-density urban developments to eco-friendly rural projects, WHI is committed to providing quality housing options that reflect the diverse needs of the Tanzanian population.
Furthermore, we are investing in technological advancements to streamline our operations and enhance customer experiences. By adopting cutting-edge construction technologies and digital platforms, WHI aims to deliver housing solutions more efficiently and sustainably, ensuring that we remain at the forefront of the Tanzanian real estate sector.
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