Kabul New City Partnership in an Exciting and Rewarding Project
Kabul New City Partnership in an Exciting and Rewarding Project
IHFD, LLC: • Established in 2007 • Based in Denver, Colorado • Operations in Afghanistan and Libya • Working in the areas of – Real estate development – Environmental technologies (wastewater Treatment and solid waste management systems) – Renewable Energy (solar, wind, hydro power) – Construction and construction material manufacturing
Kabul New City Partnership in an Exciting and Rewarding Project
Post 2014 Afghanistan • Fears: – Political Chaos including war and civil strife – Inefficient government further affected by upcoming election – Economic down turn – Less income leads to lower demand for goods and services
• Challenge: – To mitigate the risks and dare to engage in large scale investment in the country, for example in Kabul New City’s development.
Kabul New City Partnership in an Exciting and Rewarding Project
Kabul New City - An Overview: • 1.5 times larger than existing Kabul • A city for 3 million people northeast of Kabul • Expected investments over 25 years: >$80 Billion • Commercial Hub of the New Greater Kabul • Promoter: DCDA – Dehsabz-Barikab City Development Authority – Governed by an independent Board – Expected to be converted to a Corporation in next few months. – Headed and managed by honest and competent people.
Kabul New City Partnership in an Exciting and Rewarding Project
The Contract: Private Sector Investment • IHFD will build 13,000 housing units designed to accommodate up to 70,000 people and >3.3 million m2 of commercial space. • IHFD will offer 20-year mortgage to home buyers • Area under contract is 838 Hectares out of which about 450 hectares will be developed by IHFD. Remainder is non-revenue generating land e.g. Parks, public facilities, etc. • DCDA will provide primary infrastructure, IHFD will build secondary and tertiary infrastructure
Kabul New City Partnership in an Exciting and Rewarding Project
Location
Kabul New City Partnership in an Exciting and Rewarding Project
Site
Phase 1 of Kabul New City shown in yellow. Parcel 1 is shaded area.
Kabul New City Partnership in an Exciting and Rewarding Project
Phase 1
Phase 1 Structure Plan Kabul New City will be developed in 3 Phases.
Kabul New City Partnership in an Exciting and Rewarding Project
Parcel 1
Parcel 1 being developed by IHFD
Kabul New City Partnership in an Exciting and Rewarding Project
Land Purchase: •
Government is required to acquire the land and provide to IHFD.
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Contract allows IHFD to agree with land owners on partnership or direct purchase.
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IHFD has signed agreement with consortium of land owners and included them as shareholders of the project.
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Project has both community support and government support.
Kabul New City Partnership in an Exciting and Rewarding Project
Other Investors in KNC: • DCDA has already signed following contracts: – Feb. 25, 2013: – Omarzai Group – 1,580 Ha, 25,200 Units – Oxin Ariana – 533 Ha, 8500 Units – Golden Group – 263 Ha, 4200 Units – June 25, 2013: – Khawar Constr. Co. – 27 Ha, 430 Units – September 4, 2013: – IHFD – 838 Ha, 13,000 Units
Kabul New City Partnership in an Exciting and Rewarding Project
Donor Commitments: • JICA (JAPAN) - $31.6 million for Parcel 1 (IHFD site) for Roads and water • ADB - $20 million for power to Phase 1 • Islamic Development Bank and JICA jointly provide permanent water from Panjsher River to KNC • MRRD - $25 million to enhance and modernize existing villages in Dehsabz
Kabul New City Partnership in an Exciting and Rewarding Project
IHFD Team – Project Management:
Kabul New City Partnership in an Exciting and Rewarding Project
IHFD Team – Design: BBI: Breshna-Boggio International consisting of:
Plus Afghanistan Based Design Team
Kabul New City Partnership in an Exciting and Rewarding Project
IHFD Team – Investment: – GulfCap Group - GCG – Enclude Solutions - previously ShoreBank International – Others
• Land Owners: – No upfront land cost – Popular support for project – Local involvement
Kabul New City Partnership in an Exciting and Rewarding Project
Risks: • Country Risk – Mitigation: MIGA (World Bank) political risk insurance covering project against war, civil strife, expropriation, transfer restriction, breach of contract, together with loss of future profits/capital gains arising out of above situations.
Kabul New City Partnership in an Exciting and Rewarding Project
Risks: • Business Risk – Houses are not sold – Mitigation: IHFD offers 20-year mortgage that encourages people to buy. Mortgage by IHC.
– Primary Infrastructure not built – Mitigation: JICA and ADB have already committed/signed contracts to fund these. Failure will trigger breach of contract MIGA insurance coverage
Kabul New City Partnership in an Exciting and Rewarding Project
Risks: • Operation Risk: Mitigation: AECOM 45,000 Global Professionals 17,000 Americas based Professionals
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400 Global offices 140 Countries where we work 200 Offices in the Americas 6000 Staff in Afghanistan
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Engineering News-Record: #1 firm in Design in the United States Business Review Weekly: Outstanding Client Care award Ethisphere Institute: One of the world’s most ethical companies, 2011 and 2012
Kabul New City Partnership in an Exciting and Rewarding Project
Summary: • Huge need in Afghanistan • Other investors already working • Donor support in place • Strong team in place • Risks are all mitigated • Huge return on investment (Project’s IRR >135%) • Unique business model • A great project.
Kabul New City Partnership in an Exciting and Rewarding Project
Thank You Animation: http://www.youtube.com/watch?v=r4JgVNzuEMc
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Contact IHFD at
Rafaat Ludin, President & CEO 3055 Roslyn Street, Suite 207, Denver, CO 80238, USA Phone: +1-303-643-5850, ext 201 Fax: +1-303-643-5853 E-mail: rludin@ihfdllc.com Web: www.ihfd.com