Development Worshop Angola – CLIFF Housing Program

Progress, Challenges and Perspectives

• Progress against business plan• Project results x Expectations

• Programme Analysis

• Context Analysis

• Organizational Analysis

• Approach to financial sustainability

• Business plan 2014-15• Key outputs

• Project Strategies / Approaches

• Organizational Development

Progress against Business Plan

Results x Expectations

• Houses: 97 to be concluded by the end of March (240 planned)

• Water and sanitation: two borehole concluded (two more to be conclude before March)

• Land secured: 130 ha.

• Credit: No credit provided. Credit for 30 houses expected for before March)

Progress against Business Plan

Program Analisys

• Legal dispute around land ownership delayed work in 1st year and affected second year (problem solved)

• Construction speed and quality (field supervision not strong enought)

• Clear need to strengthen the team at in field supervision and in cost control (analytical accountancy)

Progress against Business Plan

Context Analisys

• State important actor in provision of housing but doing little or inadeaquate action for the lower end of the market

• Private sector also oriented to government projects or high-cost housing

• Informal sector very active in construction but with low quality

• Weak institutions make legal disputes and regularizations processes slow

Progress against Business Plan

Organizational Analisys

• Pool of organizations (DW, KixiCrédito, HabiTec)

• Public recognition. Contributed to the extra courts agreement.

• Existing in house capacity and projects in complementary areas

• Team still to be developed/strengthened in technical areas

• Systems need further development (supervision and analytical accountancy needs to be developed)

• Still at modest scale to get good efficiency and low costs.

Approach to Financial Sustainability

• Social entreprises

• Cross subsidies (e.g. Panguila)

Year 1 Year 2 Year 3

Current Assets 1.9 M 1.7M 1.7 M

Fixed Assets 7.8 M 8.2 M 8.6 M

Total Assets 9.7 M 9.9 M 10.2 M

Liabilities

Short Term Loan 356T 480 T 649 T

CLIFF-HI Loan 1.2 M 782 T 391 T

Line of Credit/ Com Loan 751 T 1.0 M 1.0 M

Equity 7.4 M 7.6 M 8.2 M

Liabilities& Equity 9.7 M 9.9 M 10.2 M

Approach to Financial Sustainability

• Social entreprises

• Cross subsidies (e.g. Panguila)

• Diversify sources of funding

Revenue Year 1 Year 2 Year 3

Core Houses 3.6 M 4.8 M 6.5 M

Cost of Houses (2.8 M) (3.7 M) (5.0M)

Plots 210 T 283 T 383 T

Gross Margin 1 M 1.4 M 1.9 M

Admin & Operating Expense 794 T 759 T 782 T

Income Before Other Exp. 256 T 658 T 1.1 M

Other Expenses 347 T 465 T 536 T

Income(Loss) Before Taxes (91 T) 193 T 595 T

Business Plan 2014-2015

Key Outputs

• Conclude the 240 houses from the previous contracts (by mid 2014)

• Increase (modestly) scale

• Prepare construction in Luanda (Panguila) area

• Strengthen supervision and monitoring systems

• Consolidate land tenure security (separate commercial project with part that we had conflith with in the past)

Business Plan 2014-2015

Project Strategies

• Continue integration with complementary projects (Urban Land Management, Water and Sanitation Project);

• Consolidate action in tandem with KixiCrédito and HabiTec;

• Use experience in community managament of basic services to strengthen community of dwellers

Business Plan 2014-2015

Organizational Development

• Consolidate HabiTerra as a company providing social houses and land managment services• Capacity development on specific areas (accountancy for

construction, contract management, etc)

• Develop public profile of HabiTerra in the housing sector

• With KixiCrédito develop/consolidate marketing for housing / land credit products

• Team development: hire more qualified staff, more training to existing team and constructors