Construction and Property Corner ::: 27 July 2023

[Bulls n Bears]

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Construction and Property  Corner ::: 27 July 2023 

 


 

 


 <https://www.hyundai.co.zw/> 

 


 

 


 

ü  Programme helps equip young African technicians with skills

ü  Local firm close to US$60m cement plant deal

ü  Norfolk Casino Delayed Over Construction Timeline

ü  Iraq awards deals for 5 new cities

ü  Community established and schools opened in Saudi's NEOM: CEO Al-Nasr

ü  Dubai sees completion of 9 real estate projects in H1'23

ü  Infrastructure upgrade work launched in Kezad Musaffah in Abu Dhabi

ü  Dubai’s Deyaar starts work on projects worth $82mln in Al Furjan

ü  Why walkability is strategic for property investment

ü  Grit Real Estate completes acquisition of developer

ü  Construction industry gathers to innovate, celebrate, and build a
resilient future at this year’s Big 5 Construct Southern Africa 

ü  Africa’s housing crisis: developers seek to scale solutions

 


 

 


 <https://www.willdale.co.zw/> Programme helps equip young African
technicians with skills

NAIROBI. – In collaboration with Chinese partners, more than 300 students
and their instructors from nine African countries will participate in a
training programme aimed at helping them become qualified technicians.

 

In its eighth year, the Africa Tech Challenge helps participants boost their
design abilities, especially in reading and drafting construction drawings
using cutting-edge technology tools. Teams from Kenya, Uganda, Ghana, Egypt,
Zambia, Tanzania, Cote d’Ivoire, Gabon and Zimbabwe have gathered at the
Technical University of Kenya in Nairobi to participate in the five-week
program.

 

The program is sponsored by the China Education Association for
International Exchange in collaboration with the Aviation Industry
Corporation of China, or AVIC.

 

Ma Chengyuan, Kenya’s AVIC country director, told participants that this
year’s competition, which will be held after the training program, will
focus on the rapidly developing engineering industry, especially on design.

 

Esther Mworia, principal secretary in Kenya’s Ministry of Education, said
during the program launch that technology studies are important to Kenya and
Africa as a whole because the continent is seeking an upscaling of
technological skills among the youth to skyrocket into the next stage of
industrialization.

 

“This challenge will enable our youth to leverage different aspects of
technology and attain advancements that will make them self-reliant,” Mworia
said. “Competitions and challenges tend to bring out the best in the
participants and we are glad to collaborate with China’s advanced technology
to uplift our students.”

 

Addressing the participants via video link from China, Zong Wa, deputy
secretary-general of the China Education Association for International
Exchange, encouraged participants to make the best they can out of the
advanced training they will receive.

 

Tsatsi Hai, the team leader from Zimbabwe, said the Africa Tech Challenge is
a youth empowerment initiative that will help young people gain technical
skills by enabling them to utilize the latest technology.

 

“As Team Zimbabwe, we expect to learn new skills and interact with our
colleagues across Africa in the field of technical and vocational education
and training. As a country, Zimbabwe is in the process of reconfiguring its
industrial processes and we hope that by improving our mechanical
engineering skills, we will improve Zimbabwe’s human capital in
engineering,” Hai said.

 

Since its launch in 2014, the Africa Tech Challenge has trained more than
1,500 technicians. This year marks the return to physical instruction by
Chinese specialists since the program was moved online in 2020 due to
Covid-19. – ChinaDaily.com

 

 

 

Local firm close to US$60m cement plant deal

Diversified local company, Kwandisa Group, has secured partners willing to
invest US$60 million into a cement plant in Zimbabwe’s Midlands Province
area to exploit a supply gap amid soaring demand.

 

The deal, now subject to regulatory approval, was concluded earlier this
month with various financing models already under consideration.

 

Kwandisa is a local business company that started in the 1990s and has grown
to become a diversified group with interests in various sectors, including
agriculture, retail and manufacturing.

 

The business, which already has interests in construction, has over the
years sold huge volumes of cement imported, predominantly from Zambia, as
local supply struggled to meet growing demand.

 

Kwandisa Group managing director Clayton Musasiwa could not be drawn to
reveal finer details due to the delicate stage of the deal, but confirmed
the project saying at least 500 full-time jobs would be created in the first
phase while 300 more would be created in the second phase.

 

“We have been in the market for more than a year now and finally we are at a
stage where everything is set and ready for conclusion. Unfortunately, I
cannot give you more details as we are bound by non-disclosure agreements,”
he said.

 

“The past year has been very busy for us with both local and foreign
investors interested in the cement venture. I am glad we have found a suitor
and now we must deliver,” he added.

 

Demand for cement is expected to remain strong driven by massive
infrastructure development projects at Government, corporate and individual
levels. Massive housing projects across the country are being implemented as
cities and towns continue to expand.

 

 

The Government, on the other hand,  has also lined up a solid pipeline of
infrastructure projects across the country, with some already under
implementation, which is driving demand for cement, creating scope for
investments into the sector.

 

Mr Musasiwa said the group also plans towards doubling double capacity at
its maize milling operation, Adult Milling Company, by the end of 2023.

 

Meanwhile, as part of their corporate social responsibility, Kwandisa Group
has been supporting more than 1 000 families in Mashonaland Central with
basic needs provisions, particularly food.

 

“For more than two decades, Kwandisa Group has been unwavering in our
commitment to serve disadvantaged households in Mashonaland Central Province
and help underprivileged families from the Bindura area by providing them
with maize-meal from its subsidiary Adult Milling Company. 

 

This programme feeds over a 1 000 families per annum,” said the group in its
corporate social responsibility report.

 

“Kwandisa believes success will be amplified as we adopt and implement
policies that prioritise the well-being of people in our community, our
employees and their families. 

 

“We also believe that sound, sustainable business practices are crucial to
building trust and enhancing our reputation,” the said.-herald

 

 

 

 

Norfolk Casino Delayed Over Construction Timeline

This week’s decision to pull the Norfolk casino project application from the
city’s Architectural Review Board was largely because of the developers’
timeline to bring the full resort concept to reality.

 

The City of Norfolk and a group led by the Pamunkey Indian Tribe signed a
casino development agreement in 2020 for a resort located on the banks of
the Elizabeth River.

 

The city agreed to sell about 13.5 acres of land, most of it a paved parking
lot that has served the adjacent Harbor Park minor league baseball stadium,
to the tribe for $10 million. The property is to become a $500 million
integrated resort casino with a hotel, slot machines and table games, sports
betting, shopping, and numerous restaurants and bars.

 

The tribe’s most recent development timeline called for an initial
construction phase to consist of a 90,000-square-foot building encompassing
a 45,000-square-foot casino floor, lobby, restaurant, bar, and a 1,200-space
parking garage. The second and larger construction phase was to include a
300-room hotel with resort-style amenities such as a pool.

 

The 2020 host agreement didn’t specifically permit the tribe’s development
team, which includes billionaire gaming industry veteran Jon Yarbrough, from
building the resort in phases.

 

City Concerns

Members of the Pamunkey development team met Tuesday with city officials
after the two sides announced they needed to get on the same page. That
meeting was said to be successful, with a joint statement stating that “both
sides remain fully committed” to the casino and a new plan will be laid out
in the coming weeks.

 

Mayor Kenneth Alexander, however, told reporters that the city is becoming
increasingly concerned about the Pamunkey’s ability to actually build the
resort concept they agreed to in 2020.

 

We’re not going to settle for anything less than the original plan,”
Alexander declared. “We just want to make sure they understand that. We
intend to adhere to what the voters were told as it relates to what we’re
going to get.”

 

Norfolk voters approved of the casino, as required by Virginia’s 2020
commercial gaming law, through a local ballot referendum. Norfolk voters
backed the casino question with 65% support.

 

Unlike other local referendums that detailed the physical location of where
a casino would be built and certain aspects of what the resort would entail,
Norfolk’s gaming referendum was more vague.

 

“Shall casino gaming be permitted as a casino gaming establishment in the
City of Norfolk as may be approved by the Virginia Lottery Board?” is how
Norfolk’s casino referendum read.

 

Phases Phased Out

Robert Gray, the chief of the Pamunkey Indian Tribe, said in a statement
that the tribe “has not wavered” in its commitment to bring a world-class
casino resort to Norfolk. The development group and city said they will work
together over the next few weeks to “lay out a plan and schedule to develop
the project as quickly as possible.”

 

It’s unclear if a temporary casino could be back in the cards. Temporary
casinos are open in Bristol and Danville, two other cities where permanent
casino resorts are being built. Temporary casinos allow developers to
immediately begin generating gaming revenue as their full-scale properties
are being built.

 

Virginia’s 2020 gaming law allows licensed casino projects to operate a
temporary casino for up to 12 months. The Virginia Lottery Board can extend
a temporary casino license for another 12 months if the casino developer
“has made a good faith effort to comply with the approved construction
schedule.”-casino

 

 

Iraq awards deals for 5 new cities

Iraq has awarded contracts for the construction of 5 new residential cities
as part of ongoing plans to tackle housing shortages, the official gazette
said on Thursday.

 

The developers awarded the deals will soon start working on the projects
after they were allotted land plots by the Construction and Housing
Ministry, the report said, quoting the Ministry’s spokesman Nabil Al-Saffar.

 

Saffar did not identify the developers apart from saying the Ministry has
selected “serious companies with experience in such projects.”

 

He said the new cities are based in the capital Baghdad as well as Karbala
and Babylon in central Iraq, Nineveh in the North, the Western Al-Anbar
Governorate.

 

“These companies are now preparing to start construction work
they have been
granted all necessary facilities and services without any administrative
obstacles or routine,” he said.

 

 

Community established and schools opened in Saudi's NEOM: CEO Al-Nasr

SEOUL — Nadhmi Al-Nasr, CEO of NEOM city project, said that a community has
been established and schools have been opened in NEOM within the current
phase of the project. He said that construction has begun throughout NEOM
city project site.

 

Addressing a press conference here on Monday, on the sidelines of the
launching of an exhibition on NEOM, Al-Nasr said that 60,000 people are
residing and working on the site to build the city of Neom. “The number of
people living and working at the site will rise to 400,000 in the next
year,” he said while stressing that NEOM is a story that will last for 25
years.

 

“When the first phase of the project is completed in 2030, we will show the
world the realism and applicability of this project, and I believe that we
can finance the project through that,” he said.

 

Al-Nasr stressed that South Korean companies will be able to obtain
opportunities in the stages of investment, financing and partnership
formation. “The project is expected to require huge funds, so companies all
over the world, including South Korean companies, are looking for
opportunities to win deals,” he said.

 

Al-Nasr is among 12 senior executives of NEOM who arrived in South Korea on
the occasion of the launching of NEOM city exhibition. An exhibition
illustrating the vision of NEOM kicked off at the Dongdaemun Design Plaza,
an iconic cultural hub in Seoul, on Wednesday. This is the first NEOM
exhibition to be held in Asia.

 

The nine-day event, with the theme of “Discover NEOM: A New Future by
Design” will run until Aug. 3. The exhibition showcases models and videos
that contain the design philosophy and urban design of major projects such
as The Line, Oksagon, Trogena, and Syndala that make up NEOM City.

 

 

Dubai sees completion of 9 real estate projects in H1'23

DUBAI: Dubai witnessed the completion of nine real estate projects worth
AED4.06 billion in H1 2023. According to data issued by the Dubai Land
Department (DLD), 392 real estate projects are currently being developed in
the emirate.

 

The latest figures further validate Dubai’s status as one of the world’s
leading real estate investment destinations and the sector's ability to
sustain its growth over the long term. They also support the leadership
strategic vision for economic development and the ambitious goals outlined
by the Dubai Economic Agenda D33.

 

In other figures that demonstrate the continued confidence of local and
international investors in Dubai’s real estate market, the first half of the
year witnessed the registration of 42,583 real estate units. During this
period, 47,187 units worth AED96 billion, and 5,546 villas worth AED15
billion were sold. The number of real estate developers registered in DLD’s
database reached 174.

 

The rental market in Dubai saw a robust performance in the first half of the
year. Total lease contracts registered in the first half reached 355,515.
Among these contracts, 166,368 were new contracts, while 189,147 were lease
renewals. Efficient and proactive services, a well-developed and supportive
infrastructure and the market’s inherent sustainability and resilience were
key factors that contributed to this performance.

 

Real estate licences

 

In the first half of 2023, the Dubai Land Department issued 4,416 real
estate licences, reflecting increasing demand for licences for real estate
various activities. Real estate licences saw a remarkable growth of 55
percent compared to the first half of 2022. The high growth in licences
demonstrates the department's efforts to bolster the real estate community’s
growth by providing proactive and efficient real estate service as well as
the sector's attractiveness to real estate development companies and
brokers.

 

The activity-wise break-up of licences issued in H1 2023 is as follows:
Brokerage in the sale and purchase of properties (1,592), brokerage in
rental properties (1,008), follow-up services (842), administrative
supervision services for jointly owned property management companies (369),
purchase and sale of land and properties (240), real estate development
(148), private real estate management (56), real estate mortgage brokers
(47), and commercial complexes (37). Other activities for which licences
were issued included shopping centres and administrative supervision
services for jointly owned real estate management companies.

 

Top areas

 

In the first half of 2023, Dubai’s real estate sector saw the registration
of 76,119 real estate transactions worth AED283 billion. Al Barsha South
Fourth topped the list of top 10 areas for the number of transactions with
7,228 transactions, followed by Dubai Marina (6,618), Business Bay (4,792),
Wadi Al-Safa 3 (4,140), Burj Khalifa (3,526), Al Thanyah Fifth (3,417), Al
Khairan First (3,333), Hadaeq Mohammed bin Rashid (3,207), El Merkadh
(3,091), and Al Hebiah Fifth (2,288).

 

The top 10 areas in terms of the value of transactions include Dubai Marina,
which tops the list with transactions worth over AED24.96 billion, followed
by Wadi Al Safa 3 (AED20.99 billion), Palm Jumeirah (AED19.43 billion),
Jebel Ali Industrial First (AED14.02 billion), Business Bay (AED13.3
billion), Al Khairan First (AED10.81 billion), Hadaeq Mohammed bin Rashid
(AED10.27 billion). Jebel Ali First (AED9.64 billion) and El Merkadh
(AED9.41 billion).

 

 

Real estate mortgages

 

Dubai Marina ranked first among the top 10 areas for number of mortgages
with 760, followed by Al Barsha South Fourth (538), Al Thanyah Fifth (536),
Burj Khalifa (520), Al Awir First (496), Jebel Ali First (473), Hadaeq
Mohammed bin Rashid (453), Wadi Al Safa 5 (409), Business Bay (400), and
Palm Jumeirah (347).

 

Wadi Al Safa 3 area topped the list in terms of the value of mortgages
(AED14.25 billion), followed by Jebel Ali First Industrial (AED13.91
billion), Jebel Ali First (AED6.15 billion), Palm Jumeirah (AED4.47
billion), El Merkadh (AED3.27 billion), Al Khairan (AED9.71 billion), Dubai
Marina (AED2.55 billion), Business Bay (AED2.51 billion), Nad Hessa (AED1.83
billion), and Warsan 1 (AED1.74 billion).

 

 

 

Infrastructure upgrade work launched in Kezad Musaffah in Abu Dhabi

Khalifa Economic Zones Abu Dhabi – Kezad Group, the largest operator of
integrated and purpose-built economic zones in the UAE, has commenced the
upgrade and revamp of the road network and facilities across 40,000 sq m in
Kezad Musaffah (ICAD 1).

 

The AED55 million ($14.97 million) project includes repairs and recarpeting
of 23 km of roads within Kezad Musaffah (ICAD 1), as well as widening of
junctions, enhanced road markings and lighting, in additon to hard
lanscaping and provison of bus stops, a statement said.

 

The enhancements are aimed at significantly improving the flow of traffic
and facilitating the movement of goods to and from the area. The project is
being executed in coordination with relevant government agencies such as the
Abu Dhabi City Municipality and Integrated Transport Centre, among others,
as well as the businesses operating in the area to ensure smoothest possible
workflow at an accelerated pace.

 

The project is planned to be completed in phases without causing
organisational or movement challenges to businesses operating in the area.

 

Mohamed Al Khadar Al Ahmed, CEO Khalifa Economic Zones Abu Dhabi – Kezad
Group, said: “Kezad Group is continually looking for ways to improve the
business experience of our clients. By improving our road network systems
and facilities in Mussafah, we are providing our existing clients faster and
more efficient world-class connectivity, in addition to sustainable and high
quality infrastructure with global standards, that meets their requirements,
in line with the vision of the wise leadership.

 

“The upgradation of the vital industrial area in Kezad Musaffah (ICAD 1)
will go a long way in reinforcing Abu Dhabi’s position as an advanced
economic and industrial hub, which plays a key role in the development of
the emirate’s economy.”

 

The Kezad Group management is taking a keen interest in the project to
ensure not only the convinience of the businesses in the area, but also that
it follows the best global environmental practices and sustainable
development to preserve the natural environment and reduce energy
consumption, the statement said. - TradeArabia News Service

 

 

 

Dubai’s Deyaar starts work on projects worth $82mln in Al Furjan

Dubai-listed Deyaar Development has begun work on combining three plots in
Al Furjan, which will house three projects worth 300 million UAE dirhams
($81.68 million).

 

The projects will house nearly 371 residential and hotel apartment units,
the developer said in a statement. 

 

The developments include Millennium Talia Residences, a furnished hotel
apartments project operated by Millennium Hotels & Resorts, and Amalia
Residences, a residential building.

 

The development of the third plot will be announced soon, the developer
said, adding all the projects are scheduled for completion in 2025.

 

 

Grit Real Estate completes acquisition of developer

Grit Real Estate Income Group has concluded the final phase in the
acquisition of controlling interests in developer Gateway Real Estate Africa
(GREA) and asset manager APDM.

 

Grit now owns a direct interest of 51.48% in GREA and a 78.95% shareholding
in APDM, following the acquisition of stakes owned by Gateway Partners and
Prudential. The respective remaining balances are held by the Public
Investment Corporation of South Africa (PIC).

 

Since Grit’s three-stage acquisition (which started in 2021), GREA has
successfully completed several developments that have materially derisked
the transaction for Grit shareholders. Notable project deliveries include:

 

The financial results of GREA and APDM are to be consolidated with Grit’s
and are expected to have a positive impact on both the value of reported
investment properties, group LTV and future growth rates and income
distributions to the group.

 

When combined with Grit’s balance sheet, GREA’s current low leverage would
be expected to result in a reduction of consolidated Grit group LTV by
approximately 2.90 percentage points.

 

Construction debt facilities are more expensive than what Grit is able to
secure, so there is the potential for Grit to provide cheaper debt funding
than is currently available and recycle operational cashflow into new
development projects rather than debt – thereby enhancing levels of growth.

 

Grit now has the ability to direct additional activities in GREA that are
expected to create value. Proceeds from its non-core asset disposal
programme (specifically focused on retail) are expected to be deployed into
new project opportunities within GREA.

 

Bronwyn Knight, chief executive of Grit, commented: “Concluding the
acquisition of controlling interests in GREA and APDM are significant
milestones towards our Grit 2.0 vision of setting global benchmarks in
Africa. The acquisitions support Grit’s ongoing transition towards a more
resilient, accretive and African impact focused asset base. These are
expected to deliver value creation and growth opportunities in net asset
value and income to the benefit of all our stakeholders, including the
people of Africa.

 

“Grit additionally gains access to GREA’s substantial pipeline of accretive
development opportunities while the controlling interest in APDM provides
Grit with an opportunity to earn substantial development and asset
management fees from internal, joint venture partners and third-party
clients.”

 

Further detail on phase 3 of the acquisition of controlling interests in
GREA and APDM

Grit acquired Gateway Partners’ remaining 13.61% interest in GREA and 1%
interest in APDM for a combined cash payment of US$33.9m. Additionally, Grit
acquired a 2.85% interest in GREA from Prudential for US$5.5m.

 

Immediately after these acquisitions, and prior to the vesting of an APDM
incentive, Grit owns 51.48% of GREA and a 78.95% shareholding in APDM.

 

Across the three phases, Grit has paid an aggregate of US$77.6m for the
total increased 31.50% shareholding in GREA, settled through a combination
of cash and share issuance.

 

GR1T : Grit Real Estate completes acquisition of developer

 

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Why walkability is strategic for property investment

 

What you need to know:

Your  investment will reap benefits not only with the increase in value of
your property but  also the businesses will enjoy  the day-to-day increase
in customer conversion. 

There are many factors that can increase a property’s appeal and
consequently its value, and one emerging trend is the property’s
walkability. Property manager Fahad Kazibwe says many house hunters list
walkable neighbourhoods top of their list when searching for new homes.  

 

 

Properties in walkable distance of amenities such as schools, shopping malls
and entertainment options are great investments and they will pay off over
time.

 

“There are more people who value being able to walk to supermarket or the
local bar from their homes. Millennials in particular prefer to use their
cars less often than any other generation and that is why they prefer living
in the suburbs where it is easy to walk to get where you want to go,”
Kazibwe says.

 

Although millennials are the majority, many other generations do appreciate
walkability, if they can afford it. 

 

“For instance, many elderly homeowners are now choosing homes in suburbs
that have a vibrant social life and lower property maintenance needs. They
will inquire the kind of people that live in the neighbourhood, the more
they have in common with the residents the more appealing the property will
be for them. Having a place of worship and a social club in walking distance
is also a bonus,” the property manager notes. 

 

Walkability and property value

Walkable neighbourhoods tend to offer more convenience and value for money
than their counterparts. The ability to walk more often gives residents a
chance to live a more active, healthy, environmentally friendly lifestyle
than they can in a neighbourhood with car-dependent infrastructure.

 

This is why an increasing percentage of new developments are now planned as
mixed-use communities. In these live-work-play neighbourhoods, residents
have access to diverse services all within a short walk of their homes or
offices.

 

Ideal distance

While walkable distances are entirely dependent on the individual’s age and
fitness, proptech came up with a system that gives an almost accurate ideal
distance. Walk Score started as a small-scale project focused on promoting
walkable neighbourhoods. 

 

Kazibwe notes that one of these neighbourhoods is Naalya, a Kampala city
suburb that has continuously been a sought-after destination for house
hunters of all ages. 

 

“Several property investors are constructing properties with curated
boutiques, greenspace, modern offices all within an easy and safe walking
distance of one another. In addition to apartment options Naalya also has
luxurious single family homes both for renting and purchase,” says Kazibwe. 

 

Business opportunities

Walkability is not just a sound investment for housing choice, it has even
greater opportunity for businesses. A business in a highly walkable
community will spend less on advertising costs simply because it converts
residents into customers. 

 

“Many of our clients are residents within walking distance from here. When
they are not able to walk here, they call and we deliver to their homes.
They are more than customers, they are friends so I look out for them as
much as they look out for me. For instance, when I opened my business, I was
only selling fast food but my clients insisted I should include local food
and healthy snacks such as fruit and smoothies, this has increased my
revenue while satisfying their needs at the same time,” says Enid Baiga, a
fast foods joint proprietor in Naalya. 

 

Located in Kimbejja Trading Centre, Baiga’s fast foods and liquor store has
benefited from the symbiotic relationship between residents and local
businesses.  She says her business mostly attracts the single, busy
corporate individual too busy to prepare meals who wants quality, affordable
meals delivered to their doorstep. 

 

She encourages people looking for a location for their businesses to
consider such neighbourhoods. “

 

There is always demand for quality services whether it is food, clothing or
even laundry services. You do not even need to worry about advertising since
the residents know each and recommend you to their friends and families,”
she adds.

 

These neighbourhoods are also a move in the right direction for
environmentally friendly housing.  Investing in properties in walkable areas
will reduce individuals’ carbon footprint consequently saving the
environment. 

 

Walk score

According to sciencedirect.com, the company uses a patented system to offer
a range of walkability, planning, health, transport and real estate data. In
addition to the walkability measure the company also offers measures of ease
of accessibility to nearby services without a car, pedestrian friendliness,
details for particular walking destination locations, and travel time
analysis.

 

 

It rates areas on a score from one to 100, with 90-100 being considered a
“walker’s paradise” and zero-24 being considered “car-dependent.” Although
Walk Score is not perfect when it comes to measuring actual walkability, the
trend of people flocking to neighbourhoods where walkability continues to
grow.

 

 

 

 

Africa’s housing crisis: developers seek to scale solutions

Every day, more than 1,000 people are added to Kinshasa’s population. The
Congolese capital has been the fastest-growing major city in Africa this
century. It swelled from just over 6m inhabitants in 2000 to more than 14m
in 2020 – an average increase of 410,000 every year, according to the
African Cities Research Consortium.

 

This level of rapid – and often unplanned – growth is placing a huge strain
on Africa’s cities. Decent and affordable housing is in desperately short
supply. The UN estimates that 230m people in sub-Saharan Africa are living
in what it defines as “slum households” – roughly half the continent’s urban
population.

 

For a problem so large, Africa’s housing crisis receives remarkably little
attention. “Everyone talks about infrastructure, and we feel like no-one
talks about housing,” laments Kecia Rust, executive director of the Centre
for Affordable Housing Finance in Africa (CAHF), a Johannesburg-based think
tank.

 

Thithi Kuhlase-Maseko, who leads the Johannesburg office of British
International Investment (BII), the UK’s development finance institution,
says that housing “has been a challenging area for private sector players,”
partly because of their difficulties in accessing finance. However, she
notes that the crisis also represents an opportunity for developers and
their investors to benefit from the continent’s urbanisation.

 

“Population growth will drive the development of more big cities within
Africa and thus the demand for more affordable, sustainable and safe
housing,” she says.

 

One of the UN’s Sustainable Development Goals is to achieve universal access
to adequate housing and the upgrading of slums by 2030. But the idea that
hundreds of millions of decent homes can be built in Africa in the seven
years left to hit the target appears wildly optimistic.

 

“Challenges come from both the supply and the demand side,” says Abhinav
Sinha, head of technology and telecoms at BII. “The demand side is not an
easy one to fix because it really boils down to just improving the income
levels as well as improving availability of mortgage products.” BII has
invested $36m in a South Africa-based affordable housing platform called
Divercity, which is developing a number of projects that cater to low and
middle-income households in the country.

 

There is no doubt that increasing the availability of loans for homeowners
and housebuilders is a key priority. “Our business could be 10 times bigger,
very, very quickly,” if customers were able to get access to financing at
reasonable interest rates, says Jason Horsey, executive director of
Kenya-based real estate developer Unity Homes. But he concedes that the
financing problem reflects the overall lack of savings in a country like
Kenya. “We don’t have enough capital in the country to justify a cheap cost
of capital.”

 

Rust reminds us that the financing challenge is “huge”. For a start,
Africa’s mortgage markets are severely under-developed. The value of
mortgages is less than 3% of GDP in the vast majority of African countries,
according to CAHF data (compared to well over 50% of GDP in almost all
developed markets).

 

Moreover, financing for homeowners is only one part of the puzzle. “You need
construction finance, you need end-user finance, and you probably need
infrastructure finance to wrap around it. And the availability of each one
depends on the other,” Rust explains.

 

It is not easy to get all of these pieces to fall into place. “Our industry
has got a really bad reputation,” says Horsey. Real estate developers such
as his Unity Homes in Kenya often have trouble repaying loans. An alarming
24% of loan values in the Kenyan building and construction sectors were
classed as non-performing in March 2023, according to Central Bank of Kenya
data. The non-performing loan ratio in the real estate sector stood at 18%.

 

So, can innovative building methods help with the housing challenge – or
even with wider issues?

 

A growing number of companies are experimenting with alternative building
methods and unconventional construction materials; others are working on
tech solutions designed to improve transparency and increase the
availability of home loans. The challenge will be scaling new approaches
quickly enough that they can keep pace with the continent’s rapid urban
population growth.

 

Homes that help with climate change

Globally, the manufacturing of building materials is responsible for 11% of
carbon dioxide (CO2) emissions, according to the International Energy Agency
– largely due to the carbon footprint of materials such as cement, concrete
and steel.

 

A wooden building, by contrast, acts as a carbon store. “The carbon dioxide
that was removed from the atmosphere and stored in the timber by the tree
when it was growing is basically stored for the long term in the homes,”
says Dutch engineer Wolf Bierens.

 

 

Bierens co-founded Easy Housing, a Uganda-based company that is seeking to
build prefabricated homes using sustainably sourced timber. It is one of
several companies offering “modular” or “prefabricated” housing, in which
the components of a house are constructed in a workshop and then assembled
on-site. Easy Housing received a grant earlier this year to help devise a
“construction stored carbon monetisation framework,” which could lead to
homeowners who store CO2 in their timber homes receiving carbon credits.

 

“The traditional construction industry has a huge negative impact on the
environment,” Bierens says. Easy Housing’s mission is to achieve the
“decarbonisation of the construction industry across sub-Saharan Africa”.

 

The company claims that these credits could be worth $2,500 in one of its
homes, which would reduce the cost of a $15,000 unit by 16%.

 

Easy Housing is still at a very early stage. It has completed only a handful
of homes so far. But its ambitions in Africa are almost limitless.

 

“We have a big, audacious goal to build one million homes by 2030,” says
Bierens. He predicts that once timber-built homes gain acceptance in
countries such as Uganda, demand will escalate quickly. Easy Housing plans
then to licence its technology to partners who would produce homes using its
designs.

 

Why not print houses?

Children in the village of Kalonga in central Malawi smiled for the cameras
in June 2021 as they celebrated the opening of a new school. This, however,
was a school with a difference – the first in the world to be built using a
3D printer. Construction took 18 hours.

 

 

The facility was built by 14Trees, a joint venture between BII and cement
giant Holcim. The same company has delivered the 52-unit Mvule Gardens
development on the Kenyan coast, one of the world’s largest 3D-printed
affordable neighbourhoods.

 

 

François Perrot, managing director at 14Trees, believes 3D printing “can
play a key role” in tackling the shortage of housing and other vital
facilities in Africa. The company recently launched a new, African-made
printer, which it expects to become the workhorse of its construction
activity. The printer uses laser systems to control quality and is designed
with a lightweight frame to make it easier to transport and assemble.

 

Perrot says that 14Trees now uses local production teams and local materials
to produce its “ink”. He says construction costs are already competitive
with conventional methods, and will soon be 20% cheaper.

 

But can 3D printing, which remains relatively nascent, really be scaled-up
quickly? Perrot insists that it can, pointing out that huge advances in the
technology have already been made in a short timeframe. “It will be much
less than 10 years,” he says, before 3D printing is making a meaningful
impact on the housing shortage in Africa.

 

“We looked at how many classrooms are needed in a country like Malawi, and
we estimated that even with unlimited funding, with the conventional
construction technologies, it will take more than 70 years to close the
backlog,” says Perrot. “The only technology that could help to clear that
backlog within less than 10 years is 3D printing.”

 

14Trees plans to accelerate the development of the 3D printed market by
licensing its technology to contractors. “What is driving us is that we want
to show the return on investment for contractors,” says Perrot. “The moment
there is a return on investment for a contractor that invests in a 3D
printer, then you will start to see many more contractors using that
technology.”

 

It’s all about the fitting-out

Not everyone is convinced that 3D printing is the right approach, however.
“To focus on 3D printing as a solution to the housing problem is missing the
point completely,” says Horsey. He says that constructing the shell of a
building is relatively easy for developers that use more conventional
methods; it is subsequent steps that are time-consuming. “You’ve still got
to come in there and do the painting and the tiling and the wiring and the
plumbing. That’s where people should be focusing their attention, as opposed
to the structure”.

 

Unity Homes has taken a different approach, focusing instead on reducing
costs and improving quality by becoming vertically integrated. This allows
the company to mitigate the “fee leakage” that most developers experience
from outsourcing key parts of the design and construction processes to
contractors, Horsey says.

 

Wooing finance with innovation

One of the key reasons for advocates of modular and 3D-printed homes
believing that they have a crucial role in the African housing market is
because financial institutions may be more comfortable in offering loans
against these kinds of properties.

 

Perrot says that the quality assurance techniques used in 3D printing help
to reassure banks that “what they finance is safe and sustainable.”

 

Meanwhile, developers that can demonstrate their green credentials
potentially have an advantage with lenders, particularly international
sources of finance. “Organisations like the World Bank and its
private-sector financing arm the International Finance Corporation are very
interested in providing financing for innovative housing solutions that can
actually decarbonise the building sector. And they are partners that will be
able to provide funding at a scalable level,” says Bierens.

 

Rust agrees that developers that use alternative construction methods may
have some advantages with financial institutions. But she still needs some
convincing that these developers can provide the key to unlock housing
finance in Africa, given the scale of the overall financing challenge and
the fact that construction finance depends on lenders being convinced that
there is sufficient market demand for homes built with alternative methods.

 

Digital transparency

“People need to start realising that affordable housing solutions that are
effective in Europe or North America will not necessarily work the same way
in Africa,” says Ronald Omyonga, an architect and consultant who has spent
more than 20 years working with various organisations on affordable housing
initiatives. He points out that the housing market in Africa remains “very
informal”.

 

“People basically build for themselves or supervise the construction
themselves. It’s owner-managed construction,” he says.

 

Even so, Omyonga believes technology can be a game-changer. In 2016, he
co-founded iBUILD Global, a technology platform that he describes as a “soft
intervention” to help improve Africa’s housing market, while working with
the realities that exist today.

 

iBUILD is designed to provide transparency. Homeowners can use the platform
to verify the credentials of tradespeople, for example. “In a nutshell,
iBUILD is an attempt to digitise that space and smooth some of the gaps
within the value chain and get transparency in that system,” Omyonga says.

 

Perhaps most significantly, platforms that offer this kind of transparency
can provide reassurance to lenders. Omyonga reports that iBUILD is now
working with a Kenyan financial institution, which plans to use the platform
to verify that construction loans are used for their intended purpose.
Homeowners would be required to send geotagged and time-stamped images of
construction to lenders through the platform.

 

Housing for the people, by the people

Africa’s housing crisis may well get worse before it gets better, given the
frenetic growth of the continent’s cities in a context where land rights are
often unclear and planning processes move slowly.

 

Large-scale developments – whether they involve traditional building methods
or more innovative techniques – are certainly needed, but there will always
be a place for much smaller projects driven by individuals or community
groups. “I think there’s real opportunity in engaging with small-scale
entrepreneurs, and doing what we’ve been calling ‘massive small’, where you
promote thousands of small projects, rather than one project of a thousand
units,” says Rust.

 

Clearly, a mix of solutions at different scales are needed to accelerate
progress in tackling a vast and dizzyingly complex problem. “We’re kidding
ourselves if we want to find simple answers,” Rust says.

 

 

 

 

Construction industry gathers to innovate, celebrate, and build a resilient
future at this year’s Big 5 Construct Southern Africa 

The tenth edition of Big 5 Construct Southern Africa concluded recently with
co-located events including the Big 5 Southern Africa Construction Impact
Awards and African Smart Cities Summit. 

 

“The construction industry is an engine for economic growth and prosperity
and it’s through working together that we can ensure a more resilient
future,” said Tracy-Lee Behr, Portfolio Director: Built Environment at dmg
events.  

 

Big 5 Construct Southern Africa contributes significantly to the economic
recovery, growth and transformation of Southern Africa’s construction
industry, placing a special focus on accelerating business through
face-to-face engagement.  The event united over 200 exhibitors, 80 speakers,
and stakeholders from over 45 countries,” Behr said. 

 

Attendees enjoyed access to 6000+ products and technologies and 30 CPD
accredited workshops, covering an array of themes from transformation to
professional development, smart construction to architecture, real estate
and more, offering a great selection of insights, particularly at the
Stakeholders Engagement Forum.

 

“This is a sunrise industry, not a sunset industry. Brick by brick, let us
build a better construction sector together,” were the words of the Minister
of South Africa’s National Department of Public Works and Infrastructure, Mr
Sihle Zikalala as he expressed government’s commitment to lead the sector to
recovery, reflecting on the triumphs and challenges, including R1 billion in
blended finance to accelerate growth and focusing on creating a thriving and
more inclusive industry. He added that improving on learning opportunities
to enter the industry, technical know-how and particularly, supporting
women-owned construction firms are among the key deliverables to see the
sector improve, along with promoting resilient infrastructure methods. 

 

Among important projects like the Just Energy Transition, The Build
Programme is now operational to promote large scale industry movement
extending to skills- and enterprise development. Mr. Bongani Dladla, CEO of
South Africa’s Construction Industry Development Board said that while we
don’t have all the money to close the funding gap in the construction
sector, we must still do all we can to move projects to ‘shovel ready’
status while paving the way for an industry that adequately reflects the
demographics of the country. 

 

Dr Msizi Myeza, CEO of the Council for the Built Environment, South Africa
agreed that we can improve on the good work being done towards achieving a
transformed industry. This includes encouraging the youth to consider a
career in construction and creating real opportunities for growth. 

 

Mr Khulekani Mathe, Deputy CEO of Business Unity South Africa reiterated how
crucial it is to improve the status quo on unemployment in the country,
where the construction industry could provide many jobs and contribute to
GDP growth.

 

Mrs Petra Devereux, Sub-Saharan Africa Regional Hub Manager for the
Chartered Institute of Building said the built environment’s contribution to
the economy cannot be disputed. But beyond the rand value, buildings keep us
safe, healthy, and serve many other practical purposes. It’s important to
set the industry to global standards, prioritising and maintaining ethical,
top-quality work with health and safety, and other relevant, modern methods
measuring up globally, enabling Africa to keep up with trends and to deliver
reliable work that will stand the test of time.   

 

Among other speakers at the events were Dr. Nicol Chang, Technical Director
at Keller on reducing carbon in geotechnical construction and Ryan Woodward,
Operations Manager of CAD4ALL Institute of Applied Architecture on
upskilling architecture professionals, equipping them for working in the
Fourth Industrial Revolution. Increasing professionalism within the industry
was a definite call to action, along with fighting corruption and improving
tender and job completion processes. 

 

The Real Estate Talks were new to the programme this year, hosted by Broll
Property Group, covering green innovation, technology and a range of
property considerations given the current market.  The winners at the Big 5
Southern Africa Construction Impact Awards celebrated while the African
Smart Cities Summit delegates delved into how these innovative urban spaces
can enhance quality of life. A clear message was that you can’t build a
smart city without a smart grid, so priorities need to match up accordingly
and all industries must work together to make smart cities a reality on the
continent. 

 

The shortage of reliable, affordable energy is among the biggest challenges
with a lot of work to be done to see improvements. Integrating sustainable
solutions into industry best practice is the way forward and these events
served as a platform for exchanging knowledge, fostering collaboration, and
promoting inclusivity and sustainability across construction and
infrastructure. 

 

“It will take time and ongoing commitment to see further positive progress
but as the saying goes; if you want to go fast, go alone. If you want to go
far, go together,” Behr concludes. 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


 


 


Invest Wisely!

Bulls n Bears 

 

Cellphone:      <tel:%2B263%2077%20344%201674> +263 77 344 1674

Alt. Email:       <mailto:info at bulls.co.zw> bulls at bullszimbabwe.com  

Website:         <http://www.bullszimbabwe.com> www.bullszimbabwe.com 

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Skype:         Bulls.Bears 



 

 

 


 

INVESTORS DIARY 2023

 


Company

Event

Venue

Date & Time

 


 

 

 

 

 


 

 

 

 

 


 

 

 

 

 


 

 

 

 

 


Afdis

AGM

Virtual | St Marnocks, Lomagundi Road, Stapleford

July 26 2023 | 12pm

 


RTG

AGM

Rainbow Towers Hotel

July 27 2023 |12pm

 


ZHL

AGM

206 Samora Machel Avenue

July 28 2023 | 10am

 


Delta

AGM

Virtual | Head Office, Northridge Close, Borrowdale

July 28 2023 | 12:30pm

 


 

Heroes’ Day

 

Aug 14

 


 

Defence Forces Day

 

Aug 15

 


zIMBABWE

 

2023 harmonised elections

August 23

 


Companies under Cautionary

 

 

 


 

 

 

 


CBZH

GetBucks

EcoCash

 


Padenga

Econet

RTG

 


Fidelity

TSL

FMHL

 


 

 

 

 


 <mailto:info at bulls.co.zw> 

 


 

 


DISCLAIMER: This report has been prepared by Bulls ‘n Bears, a division of
Faith Capital (Pvt) Ltd for general information purposes only and does not
constitute an offer to sell or the solicitation of an offer to buy or
subscribe for any securities. The information contained in this report has
been compiled from s believed to be reliable, but no representation or
warranty is made or guarantee given as to its accuracy or completeness. All
opinions expressed and recommendations made are subject to change without
notice. Securities or financial instruments mentioned herein may not be
suitable for all investors. Securities of emerging and mid-size growth
companies typically involve a higher degree of risk and more volatility than
the securities of more established companies. Neither Faith Capital nor any
other member of Bulls ‘n Bears nor any other person, accepts any liability
whatsoever for any loss howsoever arising from any use of this report or its
contents or otherwise arising in connection therewith. Recipients of this
report shall be solely responsible for making their own independent
investigation into the business, financial condition and future prospects of
any companies referred to in this report. Other  Indices quoted herein are
for guideline purposes only and d from third parties.

 


 

 


(c) 2023 Web: <http://www.bullszimbabwe.com>  www.bullszimbabwe.com Email:
<mailto:info at bulls.co.zw> bulls at bullszimbabwe.com Tel: +263 4 2927658 Cell:
+263 77 344 1674

 


 

 

 

 

 

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