Bahrain’s Housing Ministry is pushing ahead with plans to develop 5,000 new homes through a public-private partnership (PPP) deal and has appointed the local Naseej Properties preferred bidder for the contract.
A series of meetings between the Housing Ministry and Naseej have taken place over the first two weeks of April, as the Bahrain government tries to restore momentum to the project.
Progress on the scheme has been disrupted by anti-government protests, and several changes at the ministry. Bassim bin Yaqoub al-Hammar was appointed Housing Minister in late March, replacing Majeed al-Alawi who had only been appointed to the role in late February.
Naseej has arranged a degree of financial support from at least two banks, according to sources close to the project.
“The government has agreed to pay the developer as the sole offtaker of the project based on the housing units being available,” says a source. “The government will take occupancy risk, and payment risk from tenants, and will also allocate tenants for the properties.”
However, the scheme also includes the construction of around 1,500 affordable housing units as well, which Naseej will be able to decide whether to rent out or sell. The company will also take on all the risk associated with these properties.
Naseej is being advised by PricewaterhouseCoopers and Trowers & Hamlins, both of the UK, while the government of Bahrain is being advised by Ernst & Young, Mott MacDonald, both of the UK, and law firm Freshfields Bruckhaus Deringer.