Soroti estate developers struggle to make returns

With a boom in the real estate industry, coupled with the rising cost of land in urban areas and mushrooming trading centres of Acholi, Lango and Teso, many developers are devising means of creating space, accessing cheap construction materials and credit.
In Teso sub region, towns such as Soroti where land is a sensitive matter, the prosperous residents that have ventured into real estate development are facing challenges. One worry is how they have to deal with creditors, tax agencies and land policy regulators. The other is how to get tenants to occupy the estates amid the biting poverty and famine.
Those who were successful in constructing multimillion shilling structures, however, are now reeling in debt and their assets are under threat of attachment warrants from banks as a means to retire their loan portfolios.
Sometimes their houses and assets as well as other valuable property have been grabbed or attached by powerful individuals and banks by court order, having defaulted on loans acquired during construction.
Poor investiment planning
Poor investment planning in the initial stages of estate construction is one area to blame. The other is climate change.
According to Mr. Benson Ochen Ekwee, resident of Soroti Municipality Eastern division, there is an urgent need to change our mindset on architectural designs, use of materials and workmanship in light of increasing land conflicts, credit access and high costs of labour.
To put his argument into practice, Ekwee, has hired Arch Span Ltd engineering and Construction Company, which is pioneering the construction of a mini-shopping mall at an approximate cost of Shs120m. The structure which is set to have a suspended wooden floor when completed, will be the first of its kind in Soroti town.
Working at a low cost
“I’m spending only Sh10m on timber if I use a suspended wooden floor as opposed to Sh126m concrete slab,” Ekwee said; adding that this storied structure will also have a balcony overlooking the famous ‘Soroti rock’.
This he said, is in response to plans for the demolition of Soroti main market to pave way for the construction of the municipality’s ultramodern market which is funded by the World Bank.
The advert calling for bid documents of the construction of Soroti Main Market was placed in Daily Monitor of April 20, 2017 and venders at the old market are uneasy, wondering where to go next.
General knowledge is that vendors are likely to rent all houses under construction since they are close to the main market.
Ekwee, explains that he got his NSSF savings after he came of age and also got a bank loan.
Ekwee observed that with the nature of his planning, one can save him or herself a lot of frustration by pursuing the right things and prioritizing their goals because having decent houses using low cost materials but with high payback returns as in money, he is sure this would save ones whole outlook on life.
Soroti town is crowded with dilapidated structures measuring 15 by 30metres built along Gweri road (Main Street) by Asians in the early 70s. This gives the town a cluttered and slum-like appearance, although some new developers are putting up high rise buildings as one way of adding face value and creating parking space in town.
One of the developers, who didn’t want his name revealed because of security reasons, told Daily Monitor that it’s advisable that old buildings with a lease of at least 50 years should be given a new plan.
He explained that after acquiring one of the oldest Asian-built structures on Soroti Main Street, he has decided to break it down to put up a four-storey building.
He disclosed that creating a parking yard in this kind of plot is possible if developers have enough money to excavate and build a basement park but it is quite challenging to those who cannot raise the capital.

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