Turkey Housing Agency Sees Record Business Worth $2.5 Billion

  • 64K units to be built this year, TOKI head Ergun Turan says
  • Agency will erect new central bank building in Istanbul

Turkey’s government-backed housing agency TOKI will build a record number of residential units worth $2.5 billion by the end of this year, its president said.

TOKI will complete construction of 64,000 units this year, equal to 10 percent of residential units built in Turkey annually, Ergun Turan told Bloomberg News in an interview at his office in Ankara.

More than 90 percent of this year’s portfolio consists of housing for middle- and lower-income groups, according to Turan. Building cheaper housing is core business for TOKI, which was founded more than three decades ago but became a real driver of the Turkish economy after the ruling AK Party came to power in 2002.

Turan’s comments on the value of TOKI’s activities provide a glimpse into its finances before the top state auditing body Sayistay produces an annual report on the agency. While the agency’s role in Turkey’s high-paced growth years is often praised by the government, political opponents have criticized its oversight of spending.

TOKI owns nearly half of the country’s biggest developer, Emlak Konut, and together they led a campaign to boost sales after a failed coup attempt in July hurt domestic economic activity. Lower down-payments and better mortgage rates encouraged homebuying worth about 3 billion liras ($1 billion) in a month, Turan said.

TOKI collected 425 million liras thanks to a program that allows TOKI customers to save 20 percent if they repay all of their outstanding debt to the agency, Turan said. The total debt repaid as part of the campaign that lasts until the end of September is expected to be between 800 million and 1 billion liras, he said.

The agency will build 70,000 residential units to take a lead role in government plans to rebuild southeastern cities including those damaged by last year’s urban fighting against Kurdish separatists. It will also build projects for the central bank, banking regulator BDDK and capital markets board SPK in Istanbul, with completion projected by early 2019, Turan said.

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