Currently 1.2 billion people are without adequate shelter. This places some of the most densely populated, rapidly urbanising parts of the emerging world at great risk from Coronavirus, without the healthcare and infrastructure systems needed. They will be at the epicentre of this disease and its repercussions.
In addition to the direct effects of the virus, we will see significant macroeconomic impact. Supply chains are being disrupted, demand is softening, and the wider global economy appears to be tipping towards a protracted downturn. The implications of these global economic shocks could exact an even greater human toll than the virus itself.
Covid-19 has highlighted that decent, sanitary and affordable homes with running water, clean energy and enough space is a frontline defence against the health and economic impacts of pandemics. The need for affordable housing solutions at scale is more urgent than ever, not only for this disaster but to build resilient cities with residents able to withstand future shocks and to kick start economic recovery.
Reall’s Partners Across Urban Africa and Asia
In the context of this global emergency impacting lives and businesses directly, the importance of Reall’s mission has never been more important and the centrality of our partners’ businesses to delivering a critical solution on the ‘urban frontlines’ to the poorest and most vulnerable in the cities which we work.
Short term response: Reall are synergising information from across our partner’s networks in governments, the housing and banking ecosystems to develop appropriate targeted strategic responses specific to each country affected. Reall are focused on lasting solutions to serve the most pressing priorities of people on a low income.
Long-term recovery: Solutions that ultimately deliver the key to addressing emergencies caused by disasters such as Covid-19 and providing cities with the resilience they require to withstand health and economic shocks.
Reall are working with our partners and networks to reframe the dialogue as an opportunity to build back better in a way that makes rapid urbanisation work for vulnerable people. The importance of safe, quality, low-cost housing is pivotal. We are ready to work in an open-source way with others to scale our proof of concept in urban Africa and Asia, demonstrating its value in protecting people and rebuilding damaged economies.
Immediate Engagement with Partners and Networks during Lockdown
- Of critical importance during this time is ensuring the safety and wellbeing of all staff and employees across our network of partners in Africa and Asia. First and foremost, we are working with partners to ensure they have robust plans in place to ensure the health and welfare of their employees.
- Supporting the guidance from host governments, we have advised that where possible, companies adopt remote working policies and investigate the most appropriate tools to facilitate the change in business including developing monitoring mechanisms by which safety of staff and continuity of business is ensured.
- In order to preserve the progress and important work our partners are engaged with we have recommended a return to business fundamentals with an emphasis on unit economics, cash preservation, and business continuity rather than growth. We are working with each of our partners to assess sensitivity to reduced revenue and explore specific risks.
- Together we are developing tailored responses to ensure the sustainability of these vital businesses to our overall objective of transforming affordable housing markets in emerging economies and delivering low-cost quality housing to the bottom 40% of the income pyramid.
- Reall is actively engaging with our established networks both directly through our partners in priority countries (India, Kenya, Nepal, Nigeria, Pakistan, and Uganda) and through global networks of stakeholders, investors, funders and donors to highlight the need for resilient, climate smart, low-cost, quality housing solutions as a critical component in the response to global health emergencies, resilience against environmental and natural disasters and to kick start economic recovery in a post-Covid world.
Resilient Cities and Residents:
- Improved, serviced housing enables low-income residents to protect themselves against disease, maintain their livelihoods, mitigate the threats of a changing climate (such as extreme weather events), and better address the inequities of urban governance.
- The UNDP estimates income losses exceeding $220 billion in developing countries, necessitate innovative approaches to urban development. Short-term stimulus packages must foster stronger cities that protect citizens health while promoting job creation, climate mitigation, resilience and inclusion.
- Overcrowded and unsanitary settlements must be decongested and replaced with affordable, serviced housing that is climate resilient and suitable for future global and local shocks.
Building Economic Recovery
- Housing markets are powerful engines of growth, and the sector has played an important role in economic recovery from depression or recession. The UN estimates that housing construction has multiplier effects on initial investment of between 2–3 in emerging markets. Mobilising investment to eliminate the substantial housing deficits in Sub-Saharan Africa and South Asia therefore represents a massive economic opportunity to promote GDP growth, job creation, financial deepening, larger tax revenue and climate resilience.
- Reall estimates that building affordable housing at scale represents an untapped $17 trillion marketplace. Therefore we are actively working with partner’s, investors, donors and governments to engage in accelerated build programmes to deliver critical housing solutions in this time of need whilst also developing transition plans from emergency relief to ensure long term sustainable solutions for safe, quality, low-cost housing are in place for an ever-urbanising global population.
- To deliver our ambitious mission to improve the lives of 100 million people on low incomes in Africa and Asia, we recognise the need to be a learning and adaptive organisation that can respond to the changing nature of the world while continuing to deliver low-cost quality housing and transforming markets.
- Reall are responding by driving interim solutions and reviewing our business model for the urban poor and exploring rental, rent-to-buy, payment holiday schemes to provide a short-term option whilst income generation options remain limited.