The role of banks and developers in creating affordable housing in Uganda

BY JACKSON EMANZI(OPINION)

Uganda’s population is projected to grow from 37 million today to 41.2 million by 2020 (UBOS) and yet the country currently has a housing deficit that stands at close to 1.2 million units, with Kampala at a staggering deficit of over 200,000 units writes Jackson Emanzi.

To compound this concern, the Uganda Vision 2040 report projects our population at 61.3 million by 2040 with almost 60% of the population living in urban areas. This rapid urbanization is bound to put pressure on housing delivery systems which are often informal or reliant on the state. The inability to keep up with the housing demand results in increased areas of informal housing, overcrowding and slums.

Emanzi said Uganda’s middle-class needs to be made aware of the advantages in mortgage financing.

Today, banks and housing developers are looking at ways to create affordable housing options to meet the high demand from this growing population.The goal of providing affordable housing can be achieved by bridging the gap that has existed between access to capital and execution capability. It’s on this premise that banks have started to reduce mortgage rates to boost the housing sector.

Some of the banks, including Stanbic Bank, are working to strengthen partnerships with the developers in a bid to reduce on the overall cost to borrow through subsidizing on other expenses such as valuation of properties. This will be a great benefit for the customer who is looking for value and a cost effective financing option for their housing needs.

 Adjusting to meet the demand

 As urbanization gains pace, the need for affordable housing has become acute. The kind of houses currently on the market cost way more than the average middle income level Ugandan can afford. To address this concern, several development partners have adjusted to meet this demand by putting up affordable housing units for the middle-income earners.

The new projects are now majorly town flats on condominium plans, semidetached bungalows in closed gate communities and standalone bungalows in the outskirts of Kampala. This new development now implies that one can get a town flat for as low as UGX 65,000,000 (nearly $18,000) and if they have stable monthly income they can as well qualify for a mortgage to enable them to purchase the house.

There is need for developers to liaise/partner with the local authorities and government to jointly provide social infrastructure such as roads, social amenities like piped water and electricity in areas further away from the city which will make these areas attractive and accessible to the target market.

Lower interest rates 

Banks have already embarked on the journey to make mortgage financing accessible and affordable to middle and lower income households by lowering our interest rates in line with the drop in prime lending rates.As an example, Stanbic Bank has changed lending parameters to also support customers with different income levels and the self-employed or business men.

Another big part of this is starting the journey to educate the public especially those in the middle-income brackets on the advantages of mortgage financing.

Most people are not aware of the different options available to facilitate ownership of property and that’s why banks like Stanbic have partnered with several developers and platforms such as Jumia House to provide free information on mortgage rates which goes a long way in changing the misconception on how mortgage loans work, who can qualify and how to acquire one. And due to market demand, the bank has also introduced land loans to cater for those intending to acquire land for new and additional developments.

Jackson Emanzi is Head of Home Loans, Stanbic Bank Uganda

Real Estate developers demand government support

by SAMUEL NABWIISO

Real estate Developers in Uganda have asked the Government to support them to access cheap financing from both local and international  financial Institutions if their sector is to develop.

They argue that they have many projects that have failed to kick off due to failure to access cheap loans.

 Speaking during the ground breaking for the construction of multibillion Arena shopping mall in Kampala, Charles Odere the Local sponsor of the mall said it has took them more than 4years to access cheap loans to finance the US$20 Million project.

“Some of the projects require a lot of resources and our local banks cannot afford to finance such mega projects.

“That is why most developers are applying for finance  from International Institution but to secure such funds it’s not easy that is why we need government support by guaranteeing us to access these funds in order to execute the Real estate’s projects,” Odere said.

Odere the Local Investors inthe project wants Government to support  real estates Investor 

 Odere noted that there’s high demand for conducive business spaces due to the increasing influx of Asian businessmen and women like Indians and Chinese’s but the available spaces are not enough which has led mall and arcade owners to hike rental charges.

Uganda’s Minister of Trade,  Industry and Cooperatives Amelia Kyambadde said  developers should embrace the spirit of joint ventures businesses.  She said it’s the way they will manage to solve some of the challenges  facing the sector.

“Yes there’s need for government to support real estate’s developer because they facilitate trade through offering rental space but Government is also facing the same problem of accessing finance to finance its programs.

“if you form joint  ventures businesses, you can access cheap loans from the financial Institutions without government hand” she said.

The Minister used the occasion to warn Landlords especially those in the Central Business District against over charging the business community which she said it has a negative impact on peoples’ businesses especially the small and Medium Enterprises .

 “At the Ministry we receive over 100 complaints monthly  from the business communities complaining about rental charges. Some developers are even charging in foreign currency which increases the cost of doing Business,”  she explained

Minister of Trade, Industry and Cooperatives, Amelia Kyambadde with representatives from STANLIB, Knight Frank, Chestnut Uganda and project managers at the Sod Turning of Arena Mall, a 14,000 square meter shopping center development in Nsambya, Kampala

The Arena Mall is owned and developed by partnership between STANLIB Africa Direct property Development Fund and Local   Real Estate Developer Investor Charles Odere . The Nsambya based Arena is seated at 5 Acres of Land which the  Developer secured from Uganda Land commission on 99 years lease basis.

The Arena mall will be Kampala’s first   environmentally sustainable building and will have a4-star rating by the Green Building Council of South Africa.

STANLIB Senior Principal Nnema Byrd said investing in the project will not only provide space for rental but also create jobs to thousands of  Ugandans especially the Youth.

 The construction of the multibillion Arena Mall is expected to last for the period of 22 Months and it will be constructed by Seyan Brothers Uganda Limited and managed by  Knight Frank as the leading Property Managers. 

Fawe to offer 300 bursaries to disadvantaged Ugandan students

BY SAMUEL NABWIISO

The Forum  for African Women  Educationalists  Uganda Chapter( FAWE Uganda) in partnership with MasterCard Foundation have launched the Higher Education Access  Program(HEAP) which aims at supporting disadvantaged  young  women and men to have  access to higher Education. 

The HEAP program is an Eight years program that seeks to enable 300 young women and men from disadvantaged regions of Uganda to have access to higher education and leadership development.

FAWE Uganda Executive Director Christine Semambo Sempebwa said the program will be offering bursaries to 300 academically gifted students.

“The Higher  Education  Access program is unique  Initiative aimed at  giving  a platform for  all academically  talented  yet  economically  disadvantaged  students  an opportunity  to study,  realize  their dreams  and exploit their  potential  through  increasing  access to  quality Education in higher  Institutions  of learning. The  HEAP program  offers 100% bursaries  to learners,” said Ssempebwa.

Minister Tumwesigye Launching the HEAP program on his far right is Master card foundation Director for Education Peter Materu.

Under the program MasterCard Foundation will be supporting FAWE Uganda chapter with financial muscles of about US$10 Million. The program intends to support students under taking science related courses  such as Medicine, Agriculture and Education.

 According to FAWE Uganda chapter the organization has signed partnership with Five training institutions of Higher Learning where the beneficiaries of the program will be studying.

They include Busitema University , Gulu University , Mbarara University of Science and Technology,  Jinja School of Nursing and Midwifery  and the Jinja school of Laboratory Technologist.

Sempebwa said 70% of the students will be women and 30% men of the age between 18-25 in period of eight years.

60% of the course will undertake degree courses while 40% Diploma courses. Up the completion of their training the beneficiaries will be required to go back and work in the local communities where they come from to ensure that they create change in their communities.

Minister Tumwesigye (3rd Right) with some of the FAWE Board Members this was after the Luansh of the program  

The Minister of Science Technology and Innovation Dr. Elioda  Tumwesigye  applauded MasterCard foundation for  supporting government towards  the popularization of science courses  in the country.

“As Government we are much appreciative for what MasterCard foundation is doing especially in supporting Ugandan disadvantaged but bright students to access higher Education especially in the fields of Sciences,” said Tumwesigye.

MasterCard foundation, Director for Education and Learning and Youth Livelihoods Peter Materu challenged the Government to ensure that the learning Environment  is improved to entice more students to study Science related courses.

The HEAP program will  support students from  Northern Uganda districts of  Adjuman  Amudat , Amuru  Kaabong and Pader.

In the Eastern,  the program will support disadvantaged students from  Buyende ,  Bukwo  Katakwi and Mayuge while in the Western region, Bulissa Bundibugyo Kanungu and Ntoroko will benefit.

Rotary partners with Centenary Bank to avail free medical care

BY SAMUEL NABWIISO

Through one of its signature programmes, Rotary Family Health Days, the Rotary fraternity in Uganda has partnered with Ministry of Health, Centenary Bank and KCCA to avail free medical care to local communities.

The Tenth edition of the Rotary Family Health Days, organized by the Rotary Club of Kampala Central is scheduled to be launched on 21st October 2017 at the Old Kampala S.S Playground. A week later, the other Rotary clubs countrywide will set up similar medical camps to avail free health care at various health centers.

This year’s theme for the Rotary Family Health Days (RFHDs) is “Good Health, Happy Families”.

“I am grateful to all our partners for the support we have received over the years. The communities we serve turn up in large numbers at all medical camps. We are optimistic that more partners will join us to scale up the initiative,’’ says Past District Governor Stephen Mwanje

Mr. Byekwaso Godfrey, Centenary Bank's General Manager Finance hands over a cheque to Dr Edith Byanyima, a Board member of the Rotary Family Health Days & Rotarian Godfrey Jooga Ssebukulu at the launch of this year’s second Rotary Family Health Days.

.Communities are encouraged to visit any medical camp nearest to them on these days to get both specialised and general services in the areas of cancer screening (cervical, breast, and prostate); Child immunization and nutrition; Family planning and maternal health; HIV/AIDs counseling and testing; Dental services (mainly examination and extraction); Optical services; Malaria testing and treatment; Safe male circumcision; Health education and Blood donation.

Centenary Bank’s General Manager Finance, Byekwaso Godfrey said, “We chose to support activities related to cancer in the Rotary Family Health Days as part of our Corporate Social Responsibility dubbed ‘Bridging the Cancer gap’. We know that Cancer is a silent killer yet whose early detection can protect life. Through various activities, we have made millions of people aware of this scourge and knowledgeable on how to prevent it, and this has seen some women get the desired treatment early.”

Cervical cancer is one of the leading killer diseases in Uganda with about 3,915 new cases registered every year, according to the 2015 Human Papillomavirus (HPV) and Related Diseases Report.

“This year we have set aside over UGX 230 Million to ‘Bridging the Cancer gap’ activities of which UGX 40 Million will go towards the purchase of cancer screening kits to be used during Rotary Family Health Days,” added Byekwaso

The RFHD programme is implemented in six countries; Uganda, South Africa, India, Nigeria, Ghana and Tanzania. Since inception in 2011, the programme has reached out to an approximated 2 million people worldwide and over 500,000 in Uganda.

To cater for the demand in health services, two RFHDs are held annually; one in April and the other in October. The most recent event of April 2017 RFHD was able to serve a combined population of more than 75,000 people in Uganda. This time, the initiative targets 100,000 beneficiaries.

Itel Mobile celebrates 10 years in Africa

BY SAMUEL NABWIISO 

Itel Mobile, a Chinese manufacturer of mobile phones, has assured its clients across the African continent, it will continue offering quality and affordable products for several years to come.

Glory Lu,  the Regional Sales  Manager for Itel, in-charge of East Africa, was in Kampala early this week and spoke at an event to mark their 10th anniversary.

Alex Liu (L) and Glory Lu on (R) posing in group photo with some of the Itel local distributors in Uganda this was when the Chinese firm was celebrating ten years in Africa   

“Africa as continent has potential customers for Itel, but the challenge is that in some countries their economies are not doing well thus the need for support. So we shall ensure that our products penetrate the markets at affordable prices to keep everyone connected. For the last past 10 years, the company has been taking the lead when it comes to producing affordable smart phones with good functionality and premium quality. Our customers can be assured of accessing the same in the next coming 10 years,” he said.

He said taking into account the current developments in ICT and mobile phones, manufacturers should ensure that their products are accessible to the final consumers in remote communities. This is how even people in the informal, sector will embrace ICT when carrying out their daily economic transactions such as e-financing and other e-related  services which require the internet.

Itel Mobile Uganda Country Manager Alex Liu said ever since the firm began trading, sales of their products on the African market have had a positive impact on the company’s performance and influenced changes in the communication sectors of the relevant markets the firm operates in.

“ Ten years ago, itel mobile launched in Africa inspired by emission to empower everyone with  seamless mobile  communication through  reliable and trendy mobile devices. In a time heightened by harsh political and economic conditions, itel has achieved one decade of change and steady growth in Africa” Liu said. he said the firm has managed to double its African sales.

Chinese firm licensed to develop free zone

BY SAMUEL NABWIISO

The Uganda Free Zones Authority (UFZA) has issued a Developers’ Licence to China- Africa International Industrial Co-operation Company Limited within Sukulu Industrial Park, Tororo District

China- Africa International Industrial Co-operation Company Limited is a subsidiary of Guangzhou Dongsong Energy Group (U) Co. Limited and is a limited liability company.

  The Developer will establish three plants in the Free Zone, namely; a mine dressing plant, phosphate fertilizer plant and one steel plant. Additionally, the Free Zone will house Operators who plan to establish one glass plant, one brick plant and a cement superfine slag powder plant.

The various companies are indicated to increase the Country’s GDP which is currently at 21% by investing up to a tune of over one billion dollars (US$ 1.2b) by 2024.

The Minister of Finance, Planning and Economic Development Matia Kasaijja noted that the establishing of fertilizers plant in Tororo will support the development of Agriculture sector in the country

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“The Phosphate Fertilizer Plant products are vital in improving agricultural productivity for poor rural households and commercialized farms in Uganda to meet the food security needs and to promote sustained increases in income” he explained

Minister Matia Kassaija  (second Right)share light moment with Jane Guo, the CEO of China-Africa International Industrial Cooperation Co during the granting celemony.

He added that Uganda has one of the highest soil nutrient depletion rates in the world and it has one of the lowest rates of annual inorganic fertilizer application – only 1.8 kg per hectare.

The Minister said the project will support the Agriculture sector which is the major source of Income to the largest Ugandan population

The World Bank calculated that the value of replacing depleted soil nutrients could be 20 percent of average rural Ugandan household income. Promoting fertilizer use is therefore crucial to sustainable increase agricultural productivity in Uganda and beyond.

According to Jane Guo, the CEO of China-Africa International Industrial Cooperation Co. Ltd.The establishment of the various industries in the free zones will create over Seven thousand (7,000) direct and indirect jobs by the year 2024.

 “These will certainly spur economic development and improve the standards of living of the employees and their families. This is a welcome contribution towards addressing the unemployment gap in the Country.” She said.

Commenting on the production capacity of the plants to be established at the International free zone (sukuru in tororo) Gue said the plant has the capacity of producing enough for the Ugandan market.

 “We shall establish a dressing plant with annual processing capacity of 1million tons, a phosphate fertilizer plant with annual production of 100,000 tons, a steel mill with annual production of 300,000 tons, a glass factory with annual production of 55,000 tons, a brick factory producing 100 million brick per year” She explained

The Executive Director, UFZA, Mr. Richard Jabo the Tororo  Free zones  establishment is the nineth (9) Free Zone licenced in Uganda after Arua SEZ Ltd in Arua, Nilus Ltd in Jinja, Wood Impex Ltd in Kalungu and 5 Flower farms in Mpigi and Wakiso districts