Real estates experts optimistic demand for sub-sector will increase post COVID-19 era.
COVID19 might stay for a long time but life has to continue. This means learning to live with the virus and devise ways both landlords and tenants can stay in business.
After the lockdown preventive measure against COVID-19 were imposed in Uganda, many real estate dealers lost tenants and could hardly sell their properties. This resulted in many making losses and others loosing hope in the business. However experts in real estate business, and other stakeholders in the sector have changed their perspective view, as the sector started picking up when the dealers learned measures to live with virus, devised new ways of doing business, government easing of the lockdown among other new strategies.
The real estate dealers and their stakeholders in the sector in Uganda have expressed optimism, and a strong belief in the industry which they say will normalize and players in the sector will be able to make some money and in return offer clients high return on investment again.
During an online webinar organised and roadcast on Victoria University online platforms, with the theme 'investment in real estate in the post COVID era’, Prabhat Mishra (in picture above), the Crane Management Services general manager, explained that the pandemic came and hit the real estate sector in ways they didn’t expect. “Very many people didn’t know about the pandemic; they didn’t know how they were going to be affected,”
But amidst this disarray, hope reigns. Mishra of Crane Management Services notes that COVID19 might stay for a long time but life has to continue. This means learning to live with the virus and devise ways both landlords and tenants can stay in business.
For Crane Management Services that has over 2000 tenants, a strategy had to be drawn. “We sat down and laid out a strategy. First priority was the life of our tenants, we told them to follow the standard operating procedures (SOPs) - we told them how to stay alive.
“And when the lockdown opened up, we engaged them again. We told them how to stay in business. We gave them a payment plan which they were comfortable with. Yes, we got a big hit, many left but new ones came," Mishra said.
Chairman, Simba Group, Dr. Patrick Bitature (pictured above) said the during the lockdown that intensified in March 2020, many landlords and property dealers lost tenants and couldn’t sell properties.
“We had a few tenants leaving our property or give parts of the properties back to us; some requested for rent reduction which we gave to them. We had pressure from employees to reopen the hotel they wanted to be sure that they still had their jobs,” he said
Dr. Chris Baryomunsi, state minister for housing, said the government has in the recent years provided the legislative reforms need to facilitate the sector to grow. He said the real estate sector is recruitive and will bounce back from the gallows of COVID19 pandemic.
Dr Chris Baryomunsi, State Minister Housing
Jude Rugasira Kyanda, the Knight Frank Uganda managing director, speaking at the webinar hosted by Victoria University said the real estate sector in the last 20 years has been growing leaps and bounds.
This, she said, has been facilitated by the government infrastructure projects like roads across the country. However, this growth has been put in check by the COVID19 pandemic which shut down economies’ the world over.
But despite the pitfalls that came with COVID19, Rugasira is optimistic that the real estate sector will rediscover itself and they will make money. “The real estate business will always remain attractive to invest in, the future is still bright. I would encourage anyone intending to invest in real estate to fast-track what they are doing.
“We have seen a lot of SMEs struggling. Many businesses that rely on day to day interactions with people, with walk-in clients, struggled and now they are looking for rent concessions; some have had to wind down because they didn’t have the cash flow to sustain their businesses. But we have learnt to be frugal and watch our cash flows. This period has presented us with an opportunity for people to revisit their business plans, spending and their overheads.
The increasing population, rural-urban migration provides the market with a steady demand for housing units. At the moment, according to Rugasira, 80% of Ugandans need houses and shelter. This, she says, presents the sector with a huge potential for players to invest and make money.