Saturday 6th Mar 2021
Dhivehi Edition
News Reports Sports Business
Hiyaa Flats

Affordable Housing Bad for the President’s Family Business

To date, President Solih’s administration has handed over none of the 7,000 housing units built by the previous administration. The housing units had been part of the Hiyaa programme to provide citizens with affordable housing.
The issue of the housing units, when pressed, have lead pro-government activists, and the government itself, to resort to unsavoury tactics. In the first months of the Solih presidency, pro-government media channels and social media activists began derogatively describing the housing units as “pigeon-coops”.
President Solih had claimed that plans were underway to increase the sizes of these units, but added that this would also increase the rent. Some have pointed out that it would be impossible to increase the size of the units when 80% of construction had already been completed.
The President had also made additional comments about the housing units, stating that the rent per housing unit would be MVR 11,000 per month.
A flash of a grimace appeared on President Solih’s otherwise placid face when a journalist asked him for an update on the Hiyaa flats during a press conference. President Solih claimed that the units were “unfit for human habitation”; and said that when the flats were handed over, they would be unfurnished as he claimed that furnishings were a waste of money.
“As I said, it looks nice from the outside”, he said. “But that is because of all the money that had been wasted, in my opinion”.
He continued on his tirade on how he believed the flats were unsuitable.
Some days later, the government invited journalists to visit the Hiyaa flats in an attempt to convince them of how tiny the housing units were. The state-run PSM and RaajjeTV, owned by the MDP parliamentarian, broadcast reports depicting the Hiyaa flats in a very negative light.
President Solih had said that 80% of people would refuse to live in such units. He did not cite any sources for this claim.
People on social media were, however, very supportive of the Hiyaa flats and expressed their wish to move there.
Once people begin moving into the flats, the biggest shift to the economy would be with massive losses to Malé City’s real estate industry.
Many people migrate to live, work, and study in the capital, Malé City; which is one of the most densely populated places in the world. Some are forced to pay their entire monthly salaries on rent that has appreciated over the years, often to landowners who had inherited the land. Given the current market, real estate companies in Malé sell apartments of about 300 - 400 square metres for approximately MVR 2-3 million.
One such real-estate company is Pan Real Estate Pvt Ltd. The main shareholder is President Solih’s father-in-law, Ahmed Ismail Manik. The company is a subsidiary of the larger Pan Ocean International Pvt Ltd.
Pan Ocean International Pvt Ltd has four shareholders; among them are President Solih’s son, Yaman Mohamed Ibrahim, and daughter, Sara Ayesha Ibrahim. A share in the company is also held by an individual named Abdullah Ahtar Waheed and Shinetree Holdings.
Shinetree Holdings is also owned by Ahmed Ismail Manik, and President Solih’s wife owns a share in the company.
Pan Real Estate builds and sells apartments at high prices within the Greater Malé Area, particularly Malé City and Hulhumalé.
The company lists a single-room apartment of 400 square feet is offered for MVR 1.6 million as a lump-sum payment, but MVR 2 million if paid through a bank loan. Similarly, the company lists a single-room 300 square foot apartment for MVR 1.5 million; with MVR 2 million to be paid if through a bank loan.
The company lists several apartments for rent, as well. It lists an unfurnished two-room apartment of 500 square feet for a monthly rent of MVR 16,000. The company also lists other, tiny two-room apartment for MVR 39,000 a month.
The apartments being sold and leased out by President Solih’s family’s company are smaller and more expensive than the “pigeon-coop” apartments offered through the Hiyaa program.
Once the housing units are allocated to their rightful tenants, real estate companies based in Malé would no longer be able to rent out small and poorly-furnished apartments at marked-up prices.
Even if citizens were offered the 575 square foot Hiyaa units at a monthly rent of MVR 11,000, it is clear that they would prefer Hiyaa over private apartments for the sole reason that they could one day come to own the housing unit.
Companies such as Pan Real Estate would suffer a decline in demand for their MVR 16,000 a month 500 square-foot apartments is beyond a shadow of a doubt.
The negative outcomes of the success of the Hiyaa programme would be primarily felt by real estate companies and Malé landowners; such as President Solih’s family.