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Unlocking the housing shortage

By Daniel Wesangula | Published Thu, September 29th 2016 at 00:00, Updated September 28th 2016 at 23:47 GMT +3

 

The Kenyan housing industry faces an annual shortfall of more than 200,000 units. Experts believe this shortage is likely to dog the real estate market for the foreseeable future due to a number of reasons, key among them being the high cost of building.

But one innovator has seen opportunity amidst this deficit and come up with a machine that makes interlocking blocks from concrete. He says this can reduce the costs of putting up a house by almost half.

“We are innovating new building technologies for mass production of housing units which significantly reduce the cost of construction,” Charles Muriithi, the managing director of Homgenius Limited, told Home & Away.

Homgenius Ltd is a Kenyan company that has developed a machine with the capacity of producing more than 2,000 interlocking building blocks per day. The machine, christened HGM, short-form of Homgenius by Muriithi, its innovator, is automated, meaning that a home builder can get his interlocking blocks much faster.

Muriithi says the journey to the machine has been a labour of love. A labour that saw him quit his job at a local bank in pursuit of his dreams almost 10 years ago. “People at some point thought I was mad. But now they see that it was not in vain,” he said.

Bridging gap

Kenya’s Open Data Survey estimates that to date, more than three million people call Nairobi home. Almost 60 per cent of this population dwells in informal settlements. Muriithi believes that his innovation can play a part in bridging this gap.

“We want to go national because our technology can be used in any part of the country,” he said. And to do this, the company is adopting  a franchising model.

“We are engaged in innovatively researching on sustainable and affordable building solutions which are customised to suit the Kenya market. And we are keen to partner with individuals throughout the country who share our zeal and passion,” he said.

Franchising is a business relationship in which the franchisor (the owner of the business providing the product or service) assigns to independent people (the franchisees) the right to market and distribute the franchisor’s goods or services, and to use the business name for a fixed period of time.

In this case, Homgenius will assign independent investors the right to own the machines, manufacture, market and distribute the concrete interlocking bricks.

“The franchisees will benefit from the technical support, staff training and our business network,” he said.

Franchise model

Essentially, a franchisee will be required to pay an initial fee and ongoing royalties to the company. In return, the franchisee gains the use of the trademark, ongoing support, and the right to use the company’s system of doing business and sell the products.

“For us, it is just not a business venture, we have aligned our vision to Kenya’s Vision 2030 social pillar which seeks to build ‘a just and cohesive society with social equity in a clean and secure environment,’” he said.

The former banker believes that with the right goodwill and adequate investment, the housing shortage can be dealt with.

“One of our key driving forces is to see all the informal settlements in Kenya converted into habitable environments. Concrete interlocking blocks are a great alternative to natural building stone,” he said. Because of this, he said the company is open to partnerships with other like-minded investors.

He believes that the Homgenius invention is miles ahead of other competitors in the market who make interlocking blocks from soil or foam.

“Our blocks are aesthetically superior and need much less manpower since the production process is automated. This makes them more efficient than the rest in the market,” he said, adding that although the country has challenges in the housing sector, we have more than enough skills and entrepreneurial acumen to deal with them.

“It is just a matter of focus and forming the right partnerships.”


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