This archive report was first published on 6 January 2020.
HF Group, a leading mortgage financier, has announced plans to halt new construction projects in response to the real estate market's slowdown. According to Robert Kibaara, the company's chief executive, the decision aims to reduce exposure to the market, which has seen a significant decline in recent years.
"We will complete the houses we are building this year and we will not start any new construction," Kibaara stated.
As part of the move, the company will transfer assets from its property development subsidiary, HF Development and Investment Limited (HFDI), to its banking services arm, HFC Limited. HFDI has approximately Sh1.2 billion in capital and will continue to hold some land and properties, which will be marketed by HFC.
By partnering with other developers, HF Group aims to minimize duplication and maximize its participation in the real estate market. The company's decision to cease new construction comes after posting a net loss of Sh598 million in 2018, following a net profit of Sh126 million in the previous year.
