An exploratory study of project finance as a funding model for affordable housing development in Windhoek, Namibia

Master Thesis


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This thesis aims to explore the current usage of the project finance model in Namibia, with the view to explore the viability of the project finance model as an alternative funding approach to the traditional funding structures currently used in affordable housing developments and other infrastructure sectors of the Namibian economy. The research identified a predictable and strong stream of cash flow from the project, healthy competition between equity and debt financier to reduce interest rates, end-user affordability and access to finance, good governance, and an attractive market as enabling factors for the project finance model to be effective in the Namibian context. The research further explored potential opportunities and challenges regarding the application of the model in Namibia. To gain insight into these research objectives, targeted interviews were conducted by key players and experts in the financing and housing sector. An extensive study of secondary sources, consisting of existing literature and data, was also undertaken. The analysis of findings from interviews and secondary sources shows that the project finance model is a viable instrument for affordable housing developments in Namibia. However, future users of the project finance model will need to adapt the model to fit the affordable housing financing criteria and, most importantly, identify and establish the sources of financing for the end-users.