African Diaspora Mortgage and Housing

Manager's Address - Housing and Mortgage for the Diaspora Liberian

The formal planned residential property market in Liberia remains largely undeveloped. Neither the government nor residents have allocated substantial capital toward property development, maintenance, or enhancement. The initial wave of buildings post civil war primarily served the housing needs of NGOs, resulting in functional yet subpar developments. These projects prioritized utility over design, detail, quality, and consideration for aesthetic appeal.

Property improvements and aesthetic enhancements are sparse and predominantly observed in primary residences owned by individuals with the financial capacity to invest in such endeavors. Efforts to elevate the overall quality of housing and mortgage offerings remain a critical area for growth and advancement in Liberia.

A recent evaluation of available homes and apartments for rent or sale on www.kaikana.com, a Liberian-owned real estate listing services—reveals several noteworthy observations. Many properties exhibit subpar quality finishes, emphasizing functionality over aesthetics. Homes situated in isolated locations enclosed by fences, and a quality home surrounded by squalid conditions. Homes priced at levels that defy real estate market fundamentals, lacking alignment with prevailing market rates.

Addressing these disparities and fostering transparency in pricing are essential steps toward enhancing Liberia’s real estate landscape.

To be sure, quality finishes are achievable in Liberia, one simply has to look at Farmington Hotel located next to Robertsfield Airport as a beacon of hope. In addition, Premier Estate a wholly owned Liberia JV company built a few quality homes but were challenged with scaling. They had limited developer financing, limited accessible home loan products, homeowners were responsible for sourcing their own supply of electricity and water, at night it felt isolated and unsafe. Lastly, their price point of $200K without available financing limited their market because few Liberians had the ability to make all cash payment or installments over 2-3 years.

In countries like Ghana, South Africa, and Ivory Coast one is able to find quality luxurious homes with spectacular finishes, attention to detail and available mortgage financing. In Liberia, the sole mortgage product currently available is a 10-year mortgage note, exclusively accessible to Liberians working within the country, courtesy of the International Bank of Liberia. Meanwhile, in Ghana, a diverse array of mortgage products caters not only to local citizens but also to the diaspora. These Ghanaian mortgage options offer flexible payment terms, ranging from 5 to 20 years. While the Ghanaian mortgage market undoubtedly has room for improvement, its tangible benefits are evident in the real estate sector. The rise of top-quality homes and superior finishes, coupled with successful sales to the diaspora, underscores the positive impact of accessible mortgage financing.

In the diaspora, individuals of Ghanaian, Ivorian, Kenyan, Liberian, or other African descent earn comparable salaries based on their skillsets. For instance, a Ghanaian or Liberian doctor working in the same discipline, hospital, or city in the U.S. will receive compensation on a similar scale. However, there is a significant disparity: while the Ghanaian doctor can explore various housing options and financing to purchase a quality home in Ghana, the Liberian doctor faces limitations within Liberia. Liberians aspire to own homes and seek access to home loan facilities of equal sophistication as their neighboring African peers. Unfortunately, such opportunities remain elusive in Liberia.

It is quite a phenomenon that a diaspora with remittances equaling $351M in 2022 has no formalized structured opportunity or financial product which caters to them. The African Diaspora Mortgage will change that by offering both quality and luxury homes in a great location, quality accessible home loans, and scalability.

Respectfully yours,

William Thomas Bernard King

Manager, WTBK Investments LLC.

Quality Accessible Housing

Manager's Address - Quality Accessible Housing

I have been a resident of the city of Los Angeles since 2003 and I have witnessed the resilient spirit that has transformed the city over the past 17 years. From the expansion of commuter rail, the addition of many luxury class A and B apartments to the blossoming of a successful downtown. I also watched the 9th District, one that I am most familiar with come into its own with the addition of the LA Football Club Stadium, the $1B George Lucas Narrative Arts Museum (21 months to completion), and the Honda Retail and Service Center Complex, all complimenting the University of Southern California and the already existing attractions in Exposition Park.

I also witnessed the dark and ugly side of the mega sprawl and economic growth – the gross inefficiencies and inadequacies of the system in failing the most economic vulnerable segment of our populace – the poor, the homeless, and the mentally disable to list a few categories.

There’s been an unprecedented motivation from government, nonprofits, businesses, banks, and communities to tackle this issue and the timing could not be better for launching the Quality Accessible Real Estate Fund (QAREF), a sponsored fund of WTBK Investments LLC. The purpose of this fund is to make housing more accessible to the economic vulnerable. I believe that there are great opportunities in the space.

To be sure the $1.2B Build Homeless Housing bond saw $444M deployed in 2018, the Measure H saw a $460M allocation for FY 2019-20, Gov. Newsom doubled the state spending on homelessness to $1B last year. Measure H in its first 21 months permanently housed 14,241 individual and family members. These efforts appear to fall short, according to the 2020 Point-In-Time Counts Los Angeles County which saw a 12.7% increase from 58,936 to 66,433 in its homeless population. Out of the nine counties included in the count only San Diego decreased by 6%. The average increase in homeless population was 13% representing a 12,856 increase from 88,455 for the combined eight other counties.

Although I am an emerging real estate fund manager I am no stranger to this market having owned and managed economically vulnerable tenants, and I think the time is now for an innovative approach to how we support the homeless housing initiatives, thankfully I am not alone in thinking this way. “Affordable housing is only one tool for addressing the housing shortage, but it is one where there is room for new funds to help scale up innovative solutions." Funds for Kickstarting Affordable Housing Preservation and Production: Lesson for New Investor: By Elizabeth Mattiuzzi, Ph.D – March 2019 Affordable Housing Funds.

I have accumulated over 10 years of experience in managing voucher tenants, rehab and renovations, property management upkeep, real estate analysis and advisory, and project oversights preparing units to receive tenants with vouchers. I have established and built working relationships which resulted in the efficient use of service providers and service partners. I have performed well in the area most critical – securing tenants for quality living spaces.

QAREF will face some challenges:

1) Raising Capital: As the fund manager of QAREF, I will have to convince accredited investors at the private and institutional level to divert some investment capital towards an emerging fund like QAREF. There might be a ray of hope because 13 of the top 100 global real estate fund are located in California with a combined 10 years capital raised of $88.7B and dry powder amount of $17B representing about 20% of their fund under management. The big guys seem to have their fair share of money and are now looking for where they can invest for a high return.

2) Pricing: The cost of housing and land means it will be tougher to get deals that meets our criteria but it will not be impossible. Our strategy is to have a one stop shop operation from the capital raise to securing and managing the property. This allows us to be in control and execute our investment philosophy with a clear goal and without dealing with hidden agendas.

To be sure, there is room at the table for private real estate funds to join in the effort and work alongside non-profits and affordable housing developers. I am not sure I have the antidote to resolve the homeless issues. I do know that it is impacting my community and one day our future generation will ask us if we did all that we could do?