Building 900 affordable housing units in Iraq: Atlantic Village apartments
Challenge: For more than three decades, Iraq has suffered a housing shortage. Although the previous government of Saddam Hussein pledged to build millions of new homes, only a small fraction of the number needed were ever constructed. More recently, years of sectarian violence have left many homes severely damaged.
This shortage has driven prices up dramatically and the average Iraqi family can no longer afford the homes that are available. Because of strong state control over land in Iraq, local companies are unable to acquire urban land to build new housing.
Solution: In 2012 OPIC agreed to provide a $26.8 million loan to Claremont Erbil LLC to build a housing project consisting of 900 affordable apartments. Claremont is a unit of the U.S. development company, The Claremont Group, which has operated in the Middle East since the 1970s.
The new apartments are located in Kurdistan where the Kurdistan Investment Law, passed in 2006, has made it easier for foreign investors to enter the market by allowing 100 percent foreign ownership of land. In addition, Kurdistan has an increased need for housing due to a large inflow of immigrants moving from less stable regions of Iraq and looking for jobs and better quality of life.
In order to help Iraqis purchase the new apartments, the OPIC financing allowed Claremont to finance 60% of the sale price of each unit through a ten year lease purchase contract.