Affordable Housing

October 2014

Affordable Housing

� Our definition “ Housing for people who do not have access by usual financial ways to decent housing”� Emerging countries: 4 billion people (“Base of the pyramid”) � Developed countries: 150 million people without decent house conditions

� Our objective: build new markets for Lafarge and im prove housing conditions � Part of our Innovation & Transformation Programme� Part of our Sustainability ambitions: improving housing conditions for 2 million

people by 2020

� A dedicated team in Paris and local projects embedd ed within the marketing teams of Lafarge subsidiaries

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A business and social opportunity

A unique business initiative across the industrywhich improved the housing conditions of 300,000 peopl e since 2013

4 types of business initiatives

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MICROFINANCE EARTH&CEMENT

SLUM REHABILITATION MASS AFFORDABLE HOUSING

• Customer issue: Indivual home builder’s access to finance • Our solution, based on our cement bags retailers network:

Providing access to credits & technical assistance (catalogues of house designs, bill of quantities, ... )

• Customer issue: looking for durable solution without concrete• Our solution: Mix of cement and soil to produce non burnt

clay bricks , keeping asthetic and thermal inertia of earthconstruction (

• Customer issue: looking for good waterproof solution• Our solution: Bagged concrete supplied to small

customers in informal settlements

• Customer issue: quality & speed of large scale projects• Our solution: Lafarge works with developers to improve

quality & speed of construction.

18 countries with Affordable Housing projects

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Housing Microfinance (1/2)

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A Complete Housing Solution for Individual Home BuildersAccess to financing Technical assistance

Access to Retailers Construction solutions

Site visits , plans & budgetsCatalogs

Complete HousingSolution

IHBs HotlineTrained masons

Concrete blocks offer

Modular houses for bit-by-bit

construction

Roofing solutions

Trained & competitive Microfinance Institutions

For home extensions & renovation

For new homes, built bit-by-bit

Pick-up of materials

Availability of products& prices checked

Trained to basic construction technical

assistance

Tablet App

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Examples of projects: IndonesiaHousing Microfinance (2/2)

1 2 3

4 5 • n°1: 5k$, house for rent, owner selling in traditional market

• n°2: 6k$, new house, wife owns a small shop

• n°3: 2k$, renovation floor, walls and ceiling, employee

• n°4: 2,5k$, house extension, owner sells traditional food

• n°5: 4,5k$, New house, employee in a garage

Needs for new solutions

� 2 billion people live in earth-based homes

� Individual houses are mainly built of mud brick or burnt clay brick

� Environmental issues : � Increasing deforestation due partially to

the use of woof for clay bricks burning� Low resistance to monsoons, requesting

owners to rebuild houses every year

� Urgency of finding constructive solutions in Africa, Asia and LATAM, providing � durability � comfort � at a reasonable price

Our offer: Stabilized soil bricks mixing earth, sand and cement

� Advantages� Use of local materials ( earth – sand )� On-site and easy fabrication� Standardized form � Durability of the product against shock,

rain and insects.

� Pilot started in Malawi in 2013, now beingreplicated in 8 countries

Earth & Cement projects

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A construction opportunity in emerging countries

Slum rehabilitation projects

Needs in self-built neighborhoods

� 100 million urban Indians live in self-builtneighborhoods

� Many small contractors are building individual, low rise houses

� Key aspects of the demand make ready-mix concrete an attractice solution

� Quality (perceived) and time are highly valued,

� accessibility and transport are often challenging

Our pilot in Mumbai

� Dedicated mini ready-mix plant located nextto the slum area

� Delivery (on rickshaws) of 30 liters bag of fresh concrete, using special mix design

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Example in India

Mass Affordable Housing (1/2)

Situation

� Government & developers are looking for new constructions solutions to � Build faster Social Housing projects� Improve the quality & perception of such

projects (aesthetic, durability)

Lafarge approach

� Identification & test of construction systemsto optimize cost, speed, quality and durability

� Research Center in France & Construction Development Labs

� Facilate implementation of such projects� Lafarge Construction Specialists in countries� Ready-mix business line

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Addressing the needs for Social Housing in emerging countries

Illustrations

Coffor Integrated structural formwork

Mass Affordable Housing (2/2)

� Innovative construction system for multiple storey housing allowing construction modularity

� Project currently developed with a municipality near Bordeaux, a social housing promoter and an architect.

� Support from Lafarge to the architect on technical specifications.

� Development of such new construction systems could take the form an investment in architects

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New social housing in developed economies: e.g. in France

Contacts

� François PERROT francois.perrot@lafarge.comTel: +33 1 44 34 92 66

� Jean HANOTEAUjean.hanoteau@lafarge.comTel: +33 1 44 34 19 12

� http://www.lafarge.com/affordablehousing/

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Paris team