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Building stock is expected to double in Africa by 2050.

Much of this demand will be driven by population growth. According to the UN, the population in the region will grow by 315 million people between 2021 and 2030. Considering that buildings account for nearly 40% of energy-related greenhouse gas emissions annually, new housing projects must incorporate sustainability measures to ensure that these homes are resource-efficient and provide savings in utility bills for their owners and tenants. Not only that, studies show that a family can spend up to 25% of their income on utilities. This underscores the growing need to offer green affordable housing to millions of African families, particularly in countries with a large gap in affordable homes and where energy demand is driving up this cost.

Expanding Financing for Green Housing
IFC has partnered with several financial institutions to issue bonds or provide loans to expand financing for green housing across the region. For example, IFC’s provided a loan of up to $124 million to help expand Absa’s affordable housing mortgage portfolio in South Africa, reaching thousands of home buyers.

Additionally, IFC partnered with Nedbank as the anchor investor of $32.6 million in Africa’s first green bond by a commercial bank focused on green residential housing developments.  Other banks, including housing development financier Shelter Afrique, Standard Bank and Access Bank, are betting big on green financing to fund green housing projects across Africa.

Globally, institutional investors, banks, and real estate fund managers are taking their cue from the European Union’s green taxonomy. Countries, including South Africa, are preparing similar green taxonomies to best position their markets for international investment. This approach will encourage widespread adoption of the EU’s quantitative approach to defining green buildings, thereby incentivizing certified green projects in many countries that will follow.

EDGE is growing in Africa
With more than 4.6 million square meters of EDGE-certified floor space throughout the continent, many African countries are expanding their green building markets. EDGE is being used by a variety of developers that are not only positioning themselves as leaders in the real estate sector, but also are successful in accessing better financing conditions to build their portfolios.

South Africa

An EDGE Champion and a Zero Carbon Pledger, Balwin Properties in South Africa has certified 1.7 million square meters of green homes. Balwin partnered with Absa bank to develop South Africa’s first green mortgage to provide home buyers with preferential rates for purchasing a green home. Nedbank, FNB, and Standard Bank are also taking action in green housing developments, to create similar green mortgage products for buyers of green homes. Over 42,000 homes have been certified with EDGE in South Africa since 2015.

Ghana

The first EDGE-certified affordable housing project in Northern Ghana, the Lahagu Housing project consists of 100 two-bedroom homes developed by REALL. Rehoboth Knightsbridge by Rehoboth properties was the first affordable housing project to receive a preliminary EDGE certification in Ghana and consists of 1,500 housing units.

Kenya

The Mvule Gardens by 14 Trees development is the first EDGE certified, 3D-printed residential development in Africa. The project achieved 42% of savings in energy reaching the EDGE Advanced category.

Read the latest Green Building Market Intelligence Reports from Ghana, Kenya, and South Africa. These Green Building Market Snapshots are a summary of key market indicators based on IFC’s research on policy environment, building construction, and Green Building certification and finance.

Egypt

Green building developments are growing in Egypt with IFC’s $100 million investment in Commercial International Bank (CIB)’s green bond, the first private sector green bond in Egypt. IFC’s team has been providing technical support and training to CIB’s developer clients to certify their projects with EDGE.

Go Green with the EDGE Retrofit Protocol

While new building stock is an essential part of continued green building growth across Africa, it is not the only way to join the path to Net Zero Carbon. 75% of existing buildings will still be in use by 2050. This means that green retrofits will play a vital role in achieving global climate goals and must be incorporated into Zero Carbon planning for every country and company worldwide. By taking measures to go green with the existing building stock via the EDGE Retrofit Protocol, asset owners can meet their sustainability goals regardless of plans for new construction.