IHS-SA Project The Project consists of investing in IHS Fund II, a ZAR2.4 billion (~US$300 million equivalent) affordable housing fund (the Fund) that will provide equity for the development of affordable housing projects primarily in South Africa and selectively in Sub-Saharan African countries (the Project ). The Fund will be managed by International Housing Solutions (IHS), through its main investment management team based in South Africa, International Housing Solutions South Africa (IHS-SA). This will be the second IHS fund to focus on affordable housing in South Africa, after the South Africa Workforce Housing Fund I, a R1.9 billion (~US$240 million) 10-year fund that was closed in 2008. IHS is one of the most important equity investors in the South African housing space. The target market will be lower-and-middle income houses priced between ZAR250,000 and ZAR800,000 (i.e. approx US$30,000 to US$100,000).The fund will focus on the following types of projects  (i) New Builds  Develop new single-family and multifamily housing, as well as related commercial real estate (ii) Conversions  Rehabilitation of existing real estate to multifamily housing (iii) Acquisition, Rental, and Sale  Transactions in single family and multifamily housing.  The IFC participation in this Fund will be an investment of up to US$25 million, but not to exceed 20% of total fund size. . In addition, an up to US$10 million concessional investment from the Global Environment Facility, through the IFC Earth Fund Platform, would support the Fund making investments in green housing projects in South Africa.  The Fund will seek to deliver equity type returns with a target IRR of 20%+, net of fund cost, fees and carry. By the time the Fund matures, it is expected that safe and affordable housing would have been provided to over 20,000 families. The Fund will have the following development impacts: 1.	Economic development: The Fund will help address the short supply of quality affordable housing and will increase the quality of life for the lower-middle income population in Sub Saharan Africa. The spillover effects will include the provision of urban infrastructure through the development of housing communities where families can live, work and play. The Fund is expected to deliver well over 20,000 housing units over the next 10 years 2.	Demonstration Effect: Successful implementation of the fund will stimulate other industry stakeholders to replicate this model in other countries. IFC's early involvement in this fund provides support for a successful close. IHS is also demonstrating that low-to-middle income housing in South Africa is a viable asset-class  3.	Private Sector Infrastructure Development: The fund will contribute to urban infrastructure development and surrounding community development, such as roads, electricity, water access and sanitation and will mobilize government investment on supporting infrastructure 4.	Job creation: The Fund will foster, through its investee companies, the creation of direct and indirect jobs during construction of the residential properties, and also during property maintenance. The Fund is expected to create over 15,000 construction jobs over its lifetime 5.	Linkages: The Fund will increase the demand for construction and building materials in the target markets and will stimulate the use of local goods and services.