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NSSF to spend US$400 million on Lubowa project

By Julius Businge

The National Social Security Fund (NSSF) has today (Nov. 13) unveiled a master plan for the construction of 2, 741 housing units in Lubowa estate, which it acquired 10 years ago.

When development starts, later in 2014, it will be the first investment on the estate that was bought in 2003.

“We have gained because the land has appreciated in terms of value but we have also lost some opportunities because we did not invest early,” Richard Byarugaba, the Fund’s managing director told a press conference at the estate on Nov. 13, adding the officials then acquired each plot (100ft by 100ft) at Shs 50 million each, but the value of the same has now jumped to over Shs 400 million.

He said the development of the estate is in line with the Fund’s continued efforts to give its members a competitive return on their savings.

The real estate project, which will take 10 years, will be developed on the Fund’s 565 acres of land along Entebbe and will be one of the most upmarket housing estates in Uganda.

The project is planned as a mixed use development with residential housing, commercial facilities inclusive of office parks, retail, school, hospital among other developments. The housing units that will be constructed are apartments, town houses, Bungalows and Villas, which are suitable for middle to high income earners.

Byarugaba said the houses will be sold on the open market to both the Fund members and the general public.

The project will be implemented in 10 phases and has received approval from all the authorities concerned.

The real estate portfolio holds the least of the Fund’s investment, but Byarugaba is optimistic that the increasing number of foreign investors jetting in the country and the developments happening in the oil sector among other factors will boost the sector going forward.

In the past three years, the Fund has doubled its assets from Shs 1.7 trillion in 2010/11 to Shs 3.4 trillion in 2012/13. Up to 81% (Shs 2.8 trillion) of the Fund is currently held in fixed income securities, while the real estate investments account for only 12% (Shs 405 billion) and Shs 259 billion is held in equities.

Last month, the Fund increased interest rate payable to members to 11.23% from 10% the previous financial year as a result of improved performance, according to Byarugaba.

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