Calgro M3 gets almost R400m loan from France’s development bank

France’s development bank has lent R387m to JSE-listed residential property developer Calgro M3.

The money will be used to build houses for people with low incomes in urban areas earmarked as priorities, Calgro said on Wednesday. It has R27.7bn worth of affordable housing projects on its order books.

Though Agence Française de Développement has been supporting development in Southern Africa for 40 years, Calgro said this was the first funding it had undertaken in the affordable and integrated housing sectors, globally.

The loan has been provided via the agency’s private sector financing arm Proparco.

The loan equates to €25m, but Calgro said it opted to secure all its international funding in rand so as not to expose itself to foreign-exchange risk.

The term of the loan is six years with an anticipated fixed simple interest rate of 12.41%, payable in six-monthly intervals.

The first draw-down of R278m is anticipated in December, with the second and final draw-down of R109m in May.