Affordable housing developer, Alleyroads, has received funding from Jaltech, one of its Power Purchase Agreement (PPA) funders, to retrofit a portfolio comprising rental apartments and student accommodation recently onboarded as part of the R1.2 billion Pulse Property Group acquisition.
Some of the Jaltech funding has also been allocated to install new energy saving systems at some of the Group’s current developments.
Alleyroads is the first affordable housing developer in South Africa to provide off-grid power solutions at its new developments and retrofitting existing assets forms part of the Group’s strategy to reduce reliance on the national power grid and save tenants money on electricity bills.
“Where feasible, we have earmarked the full Alleyroads portfolio including properties in Cape Town, East London, and KwaZulu-Natal’s South Coast to be fitted with either grid-tied solar or full off-grid solutions,” says Ivan Pretorius, Founder and COO of Alleyroads.
“The Jaltech funding enables us to retrofit our newly acquired and existing portfolios to reduce energy consumption in buildings, save tenants money on energy bills and reduce the Group’s greenhouse gas emissions.”
Retrofitting refers to a significant energy upgrade on a building to make it more energy efficient. This includes the installation of solar panels, upgrading insulation and smart energy management systems, resulting in reduced energy costs for tenants or building occupiers.
Pretorius explains that the Group partnered with Jaltech as they are specialists in financing solar installations for businesses and solar installers offering Power Purchase Agreements. Jaltech is an alternative investment fund manager with approximately R2 billion of retail investors’ capital under management.
“Jaltech’s unique advantage lies in their ability to provide an off-balance-sheet funding solution with competitive rates and tenure compared to traditional financial institutions. A longer funding term makes investments in solar and off-grid solutions much more feasible. We hope to raise additional capital through Jaltech to expand our investment into solar.”
In 2023, Alleyroads acquired Pulse Property Group and its portfolio of 2 200 student housing accommodation units and 1 100 affordable rental apartments across 46 developments in the Eastern Cape, Gauteng, and Western Cape provinces.
Including this acquisition, Alleyroads’ portfolio comprises over 6 500 affordable apartments and student accommodation. Rental prices range from R4 000 to R6 000 per month, catering to lower-to-middle income households with an average annual salary of about R238 000.
