Boidus Focus - Vol 2, Issue 4 [May 2012]

01.05.2012

OIDUS FOCUS

Registered at GPO as a Newspaper Volume 2, Issue #4

NEWS > 02 Engineering Registration Board In Progress 03 Commercial Property Markets - Global Investment Activity

Botswana’s Architecture Design and Urban Landscape Newspaper

www.boidus.co.bw

BOIDUS NEWS >

BOIDUS FEATURE >

EDITORIALS > 04 Coal, Carbon Capture And Storage (CCS) Technology 05 Designing for People Living with Disability: An Architect's Contribution to an Accessible Botswana

COMMENTS > 13 Why is Botswana failing to provide quality housing for its citizens?

13 Cities should be firstly designed for people, not cars - Dr. Henri Comrie

PROPERTY / FINANCING > 12 Finance Corner / Savings Versus Investments 12 Real Estate Focus / Commercial Land Allocation in Secondary Areas, Is it helping Botswana?

P5.00 (Including VAT)

Commercial Property Development in Botswana Retail, Office, Leisure, Logistics & Industrial Investment Opportunities

by H. Killion Mokwete and Keeletsang Dipheko

Exploring Alternative Commercial Property Market Investment Opportunities:

UB Student Housing

Airport Junction On Time

LOCAL PRODUCT DIVERSIFICATION OPPORTUNITIES

In Botswana’s Commercial property market, opportunities in alternative investment market services are still largely unexplored. Some services include market advisory roles such as Building Consultancy, Capital Markets, Energy & Sustainability, Facilities Management, Fund Management, Global Corporate Services, Lease Consultancy, Office Agency, Planning advisory, Property & Asset Management, Rating & Taxation, Real Estate Finance, Loan & Corporate Recovery, Research, Tenant Representation, Valuation Advisory and many other ancillary services.

Botswana's Newest Regional Retail Mall

by Keeletsang Dipheko / Images © Khumo Properties Khumo Property Asset Management is a joint venture between Botswana Insurance Fund Management (BIFM) and Eris Property Group. BIFM is the largest fund manager in Botswana with close to P15 billion worth of different asset classes under management. Eris Prop-

erty Group (formerly RMB Properties) has more than R11 billion property assets under management in Southern Africa. Eris has specialist experience in property asset management, property management, property development, >>> CONTINUED PAGE 07

BOIDUS EXCLUSIVE >

Exponential Towers, CBD, View of Facade: A landmark office facility in one of the most prominent positions in the new CBD. Currently office space is being let by Knight Frank Botswana.

> COMMERCIAL PROPERTY ADVISORY OPPORTUNITIES: Building Consultancies • Planning advisory • Building consultancy • Energy & Sustainability advisory Global Cooperate Services • Capital markets • Real time market data analytics • Financial Advisory > LEISURE COMMERCIAL DEVELOPMENT PRODUCTS Urban entertainment activities • Night economy activities

Fully fledged redlight districts • Family Urban leisure activities

Amusement parks

After school sport activity parks

Government Should Invest Capital In Affordable Housing

BHC Deputy CEO Operations, Mr. M. Majingo / Boidus Housing Exclusive

by H. Killion Mokwete and Mpho Mooka Boidus sat down with Mr Milidzani Majingo, Botswana Housing Corporation Deputy CEO Operations to follow up on their role in the development of 'Quality Affordable Housing in Botswa-

na.' BHC as a key stakeholder in the housing market carries wide reaching influences both on Government and Private sector Housing activity. >>> CONTINUED PAGE 10

> INDUSTRIAL AND WAREHOUSE DEVELOPMENTS • Science research & Technology park • High spec secure industrial units • Diamond sorting & polishing units

GLOBAL PRODUCT OPPORTUNITIES • Embassy House, CBD, View of Lobby: A new 16-storey building in Gaborone's CBD designed to accommodate / house several embassies. Core spaces include Embassy / Consular offices, Exhibition, and Public Interface spaces.

Botswana’s Commercial property Market has come of age from the days of the general dealer shops and pokey offices to today’s regional malls and skyscrapers. The maturity of this sector of the property market is now being fully

backed and run by private developers and investors. Boidus Focus compiled the following basic data to give an overview of the prospects of this Commercial Market Profile in 2012:

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Industrial markets - modern logistics, new demand patterns by specification and geography are set to more interest for investors in a sector with attractive record for stable performance.

Retail - Areas of retailer expansion should be tracked; luxury brands growing globally and Chinese and US retailers looking abroad and including new markets.

>>> CONTINUED PAGES 08/09

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Local News Page 2

BOIDUS FOCUS Tuesday 01 May, 2012

Engineering Registration Board in Progress

by Esther Amogelang

Engineers Registration Board (ERB) conducted a regional workshop recently at the Big Five Lodge to update stakeholders on progress being made towards the implementation of the Engineers Registration Board. The workshop which started at Majestic Hotel, Palapye, aimed to bring and get views, ideas and opinions from all engineers in Botswana on the best way to go about implementing the aforementioned Board.

Speaking at the workshop, ERB President A.V Lionjanga said unlike many professions in Botswana such as Medicine, Law and Accountancy, which are regulated by their own statutes, the engineering act has lagged behind and remains at the bottom of the pile.

He said it is for these reasons that a Board should be put in place in order for Engineers to also register to legally comply with the requirements of their respective bodies, as in other SADC countries.

The registration of the Board will, amongst many things, go a long way to protect clients and the public from unsafe engineering services, as well as putting the engineering practice in its

rightful place within reasonable time.

It will also help clients and employees who have in the past been exploited by unscrupulous persons or firms whose principles did not have the required qualifications or experiences to sign off on designs, leading to unsafe engineering designs, systems and structures.

The ERB developed a strategy for implementation of the Act following a deliberate decision in March 2011 by the board to come up with a strategic plan.

CGP was the successful bidder and they immediately worked on the report.

CGP covered a three year strategic plan which then provided a framework for the implementation of agreed priority objectives and their sequencing with a view to commencing statutory registration of professional engineers within the second quarter of 2012.

When asked when the Board will be visible to the public, Lionjanga said it is their desire as a board to make it visible, and therefore they are currently working on strategies on objectives of visibility. He encouraged all engineers to work together with the board to drive the program forward in order to succeed.

He said during the period of developing the strategic plan, ERB shall promote public education and awareness about the mandate, power and authority of ERB to prepare them for the impending statutory registration engineers.

by Esther Amogelang

ERB is committed to outreach programmes by interacting with key stakeholders, benchmarking by visitation to selected ERBs within the SADC countries and beyond to draw from their experiences and customize to suite their local conditions.

In spite of their effort to establish an administration, Mr Moses Ngorima from CGP Consultants said the board continues to deal with many challenges, among others, non-existence of key staff and adequate office accommodation.

He said they are currently working on their next step to recruit staff as well as develop regulations for standards and eligible requirements.

The Enactment of the Engineers Registration Act CAP 16:06 in 1998 and subsequently amended in 2008 is a government commitment to the development, upgrading and promotion of professional engineering practices in Botswana.

A 350 million pula project development by BR Properties through government and Botswana Railways partnership stands as one of the few first projects to have met their deadline as it was delivered on time. This was said by Honourable Yame Rakhudu-Project Manager at the official opening of the rail park mall recently. What started or used to be a piece of land, plot 4716 in Gaborone Railway station to be precise, has now become one of the leading shopping centres in the Botswana capital. The land was previously used by the then, Rhodesian Railways, National Railways of Zimbabwe and what is now Botswana Railways.

The journey of the Rail Park Mall began way after the board was approved

by JTTM Properties (a team comprised of Botswana Railways, BIFM, IRIS and Tredinnick). A team was therefore put together which then developed a mall concept through calculated risks. With the planning approved after several changes to the master plan, the construction of the major project commenced. At first the plot was zoned for railways and industrial uses but the appointed team worked hard with consultants to change that.

Universal Plaza's

Embassy House

'Rail Park' Delivered On Time

Universal Builders (Botswana) (Pty) LTD

A 16-storey building designed to house several embassies

This state of the art shopping precinct could not be successful if it wasn’t for the hard work of international best practices of Murray and Roberts, the contractors of the mall, as well as Inex Botswana & Climate Control as Electrical and Mechanical Sub-contractors and many others.

Rakhudu, in his remarks, pointed out that the new mall has changed the face of the city and its uniqueness lies in the provision of a state-of-the art pedestrian bridge for use by customers. The project’s million pulas, he emphasized, has been spent on expanding better roads & signalizing the junction within the area to create better vehicular access as well as improve efficiency of shoppers in and out of the mall.

The Embassy House accommodates three core functions 1. Embassy / Consular offices 2. Exhibition - Conference Facilities - Exhibition Rooms - Audio-Visual Rooms 3. The Public-Interface - Entrance Foyer - Café - Visitors Lounge

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He said the mall would contribute to the growth of the economy and related multiple effects as well as developing infrastructure and services in the area.

The mall has become the centre of commercial life in the heart of the city, just across the newly built Central Business District (CBD).

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Like many multi-million pula projects, the construction of this shopping precinct was not smooth sailing. “There were times of impatience, embarrassment, arguing, fighting, and deferrals from authorities and so on, but at the end of it all, we succeeded because we kept our goals and objectives in mind”, said Rakhudu.

Situated in Gaborone's CBD directly fronting the Government Enclave, Embassy House is strategically located and easily accessible via the major highways of Nelson Mandela Drive, Limpopo Way, Mogoditshane Road and Nyere Drive.

To date, the mall has been the centre of attraction having created a lot of opportunities for Batswana especially addressing the issue of unemployment in the city. The total number of people employed on site was approximately 450, of which 20 were expatriates. Rakhudu further applauded those who were on site saying was it not for their dedication, commitment and hard work the project could not have been delivered on time and been a success.

The prime principles that guide the design of the building are: • Multifunctional facilities that celebrates diversity • Accommodating diverse functions/operations that work well together and depend on each other • A platform for interaction and communication • Facility dose not portray any single identity • Security

BR Properties, a 100% subsidiary of Botswana Railways, was established to commercially exploit Botswana’s prime land and manage Botswana Railways owned and other available property and compile a highly diversified property market.

Embassy House

...a landmark building visible from many points in the City.

YEM Graphics

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Project Managers: AMA Project Botswana Contractors: Murray & Roberts Quantity Surveyors: Dithologo Mmile Associates Civil & Structural Engineers: Lesedi Consulting Engineers Electrical & Mechanical Engineers: QED Consulting Engineers Architects: Arcswana Architects

BOIDUS FOCUS Tuesday 01 May, 2012

Local / International News Page 3

Minister Swartz explored BIUST

by Esther Amogelang

Commercial Property Markets - Global Investment Activity

by Boidus Admin / Source: International Investment Summary, Cushman & Wakefield, 2012 MARKET SUMMARY NOTES •

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• Situated on an expensive and ecologically diverse 2500 hectares side of gently sloping land in Tswapong Hills, Botswana International University of Science and Technology (BIUST) is the new development south east of Palapye. This architecturally built environment has been integrated with the unspoiled terrain by creating themed landscaping and supplementing the structure with parking bays facilities, extensive sports facilities, roads and recreation infrastructure.

The Minister of Infrastructure, Science and Technology (MIST) Honourable Johnnie Swartz, Foreign Minister Phandu Skelemani and the Chinese Ambassador to Botswana recently explored the landmark. The main reason of the tour was to be briefed on site as well as to get feedback on why the project was progressing slowly and see what was completed and what remained outstanding.

According to a statement from Public Relations office at MIST, the project which is already two years behind schedule is now 88 per cent complete.

The delay was necessitated by multiple factors, including among others things, many underground rocks that required considerable blasting, as well as unreasonable slowness of contractors.

Swartz said his ministry is concerned with slow delivery of the projects. It is for this reason that he was prompted

to invite the ambassador to discuss the way forward. He said this has been made clear to the contractors.

Since its inception, the P430 million project, which was supposed to be completed last year, has been having controversy such as poor workmanship and oversight problems.

The school is among many government projects done by Chinese contractors which have in the past fallen behind schedule. For his part, the Chinese Ambassador to Botswana during the site tour, admitted that the project is behind schedule due to the fact that contractors are slow and sometimes rely on materials which they order from outside.

He further explained that unlike many Chinese projects, the construction of BIUST was one complicated issue attracting different opinions from clients.

Sub-contractors failed to avail themselves on time at the site. He however, promised to speak to his counterparts with a view to expediting the completion of the project. China Civil, the contractors of the project, have made an undertaking to complete the project and hand it over by July 2012.

The campus is temporarily situated on an interim campus at Oodi College of Applied Arts. The campus is a phased new construction with academic facilities, recreation space, accommodation and staff housing having been purposely built to deliver a superior learning and living experience.

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Global Investment rose 14% in 2011 to US$727bn (US$808bn including multifamily) and volumes are now 83% up on their 2009 lows.

North America was the star investment performer over the year as a whole, with commercial property volumes rising 52% versus 17% increase in the EMEA, 9% in Latin America and just 0.5% in Asia Pacific All regions did see robust demand for core well established assets and activity was also boosted by investor’s search for inflation proofed incomes.

However as the year went by, higher inflation hit occupiers business margins while political uncertainty and global financial market turbulence grew.

Amidst this uncertainty, investor risk aversion escalated and trading volumes slipped 7% between first and second halves of the year.

This however is likely to prove a temporary setback for emerging markets. Indeed, while global trading volumes are still barely two thirds of pre-crisis levels, many emerging markets have already set new highs, with Asia volumes 39% up on 2007 and Latin America volumes just surpassing the mark by 0.5% Asia remains the largest investment region overall, with a 50% share of global trading last year, again dominated by land sales which accounted for 74% of the total.

China was the largest market for the third year running but its lead over the US has fallen.

Pent-up demand is slowly building, with many businesses being pushed to upgrade their property not by pure expansion needs, but by the need to react to issues as sustainability and higher energy costs, new networking and shopping practices and generally the need to increase efficiency.

INVESTOR STRATEGIES Property’s appeal has increased due to sustained low interest rates, a weaker growth outlook and volatile inflation picture. Many property investors are having to rethink their strategies and looking at property for the absolute income return it can deliver on a risk adjusted basis not just as a matching a benchmark for the asset class.

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• Shanghai, China: Nanjing Road [Source: wikipedia]

Furthermore, the aspect of BIUST will include science & technology Research Park with facilities for business incubators to facilitate invention, innovative technology transfer, housing for students as well as visiting researchers.

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Botswana International University of Science + Technology (BIUST): CM+ prepared the brief and conceptual masterplan for a 10,000 student campus in Palapye, Botswana.

However delay in the physical construction of the campus at Palapye has been the key driver of the need to commence teaching at an interim site.

NYC, USA: Times Square [Source: wikipedia]

bedZED, London, England (image source: en.wikipedia.org)

Historically low interest rates in many countries has held down the cost of capital for property and reduced target return expectations, elevating an income-led strategy ahead of growth strategy for many.

Diversification of products requires investment, not just in a large number of large core markets, but exposure to segments of the market which react differently or have differing drivers and hence can complement and smooth overall performance.

This may lead to an increase in investments in new markets as time goes by and increased exposure to riskier markets in some case.

Technology will continue to make a difference in 2012- with property users and hence property impacted by Cloud, mobile computing and social media for example.

Office markets face an obvious supply led cycle in many markets but structural drivers of change are also impacting on demand and in gateway cities and areas of skill clusters for technology, healthcare, energy, advanced manufacturing or media, good prospects will be seen for providing modern effective space.

Industrial markets face over capacity in some areas but particularly for modern logistics, new demand patterns by specification and geography are set to more interest for investors in a sector with attractive record for stable performance.

Retail will continue to generate interest from investors seeking stability and low risk. Areas of retailer expansion should be tracked. With luxury brands growing globally and Chinese and US retailers for instance increasingly looking abroad and including new markets in search areas.

Opportunities in hospitality and multifamily property are being more keenly pursued as are other sub sectors where income is secure and growing, such as healthcare.

Investors pursuing a growth strategy must access emerging markets where they can potentially enjoy a double benefit of rising incomes and falling yields as local investment markets mature.

Editorials Page 4

BOIDUS FOCUS Tuesday 01 May, 2012

GOING GREEN

Coal, Carbon Capture And Storage (CCS) Technology: A Real Fortune Or Fools’ Gold In The Solar Age? [Part 1 - The Background]

by Goitsemodimo Manowe, Current President of Architecture Registration Council (ARC), Director & Founder of Pinagare Architects, [the author writes in his personal capacity]

That the current levelised cost (Present value of the total cost to build and operate)of concentrated solar power generation world-wide is considered by analysts to be high (+- 115 to 310 USD/ MWH), and surpassed only by some of ocean energy technologies ,is primarily because it has taken the world a century to wake up to the fact that, “pound for pound” this solar resource is by far the best, should and had it benefitted from similar levels of research, development and financing over-time. It has also become clear that the political economy of capitalism has in the past managed to sustain technical, capital markets as well as political and public policy barriers to the growth of renewable energy technologies - solar power technology in particular- technology that derives its major advantage from Distributed Photovoltaics (DPVs) as opposed to centralized generation, as in the case of fossil and nuclear fuels. The barriers, which are never-the-less being broken, have been numerous and include; • distorted pricing that fails to take into account the full cost of ortho-

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dox sources up to the point of load compared to the more direct and distributed solar power generation; failure to internalize costs related to the environmental impact of fossil fuels that would otherwise work in favour of solar power; electricity markets that are biased towards centralized power stations and continued dominance by established and monopoly operators and, therefore, suppressed community and stakeholder participation in energy generation and supply; lack of liberal energy markets whereby consumers should be forced to face the full cost of their choices between fossil fuels and renewable sources of energy ; national grids not suited to receive power from small sources, typical of DPVs; inadequate financing options for investment in renewable energy technologies in general; Stock market valuation and market capitalization which has been out-of -favour with stock market investors, i.e. big business with major influence on policy; Very few players in the manufacturing subsectors (less than 10 credible players word-wide for wind or solar PVs) - a high private monopoly market.

The list goes on!

To further put the matter into perspective, the Sun’s energy drives processes in the entire biosphere, including the formation of fossil fuels, which are second-order by-products of this uniquely important resource. Unlike fossil and nuclear fuels, the Sun’s energy is more directly available to humankind and scalable through Solar-thermal power, Photo-voltaic, and indirectly available through Bio-fuels, Geothermal Energy, Hydro-electric and Wind Power, and

YEM Graphics

Humankind has evolved under the Sun and has known and admired the awesome power of this star and even worshipped it, yet it has taken more than a century for civilization to consider tapping into this relatively free, infinitely available and abundant renewable energy resource to drive the world economy, concentrating instead on finite sources (oil and coal) which are logistically and technically more demanding to extract, transport and process into energy. In the process, the world has sidelined other important renewable sources like hydro-electric and wind power, for which power generation technologies have been around for a while which, however, suffered from lack of sustained research and development. It points to the propensity for the world, under the political economy of capitalism, to promote and thrive on scarcity, dominance and control.

more recently through 3rd generation technologies such as Concentrated Solar Power (CSP), Hot-dry Rock, Ocean Energy (tidal stream, range and wave) and Ground Source Heat Pump systems (Geothermal Heat Pumps). It is a vast resource, manifesting itself in so many other ways other than energy from Photo-voltaics and solar-thermal heating as most of us might tend to think.

To illustrate the sheer abundance of solar energy; the total annual potential from solar energy, according to Richard Perez, is estimated at approximately 23000 Terra-watt Years per Year (TWY/Y). At an estimated current total world consumption of 18 TWY/Y, the world’s total consumption of energy stands at a meagre 0.08 % of the Sun’s annual potential, yet there is a worldwide shortage of power! On the other hand, the world’s total planetary reserves for uranium, coal, natural gas and petroleum fuels are estimated at 1655 TWY. At the current energy consumption level, it will take approximately 92 years to deplete them. This period is considerably shorter (approximately 65 years) for coal and oil, which have been the dominant commodities, hitherto, in the world energy markets.

By contrast, the annual solar potential is 14 times the potential from all planetary reserves of finite sources including the annual potential from natural gas; a commoditized and finite resource which is generally promoted as a low pollutant and now enjoying incentives for the construction of new gas-fired power plants. Furthermore, the Sun’s energy (fuel) is available in perpetuity and almost freely after the power generation infrastructure costs have been fully amortized.

Yet there is no denying that the world has entered the Solar Age, an era which has come about due to a combination of factors, chief amongst them climate change from the effects of carbon emission from fossil fuels and the impending depletion of those fuels. Whilst the issue of climate change has triggered the search for non-polluting sources of energy, the ballooning world population problem has become a major driver of energy demand accelerating the shift towards renewable energy sources, in particular Solar-thermal, Photo-voltaic and wind. In an environment where the cost of power generation from fossil fuels is constantly increasing amidst growing pressure from environmental lobby groups as well as the soaring world energy demand which is predicted to almost double by 2050 to about 30 TWY/Y, there is a diminishing chance that the 65 year window to exploit the remaining planetary reserves of fossil fuels will see the light of the day, given that the problem of climate change is closely linked to population growth and energy poverty.

The odds are stacked against nonrenewables, especially fossil fuels, as viable and primary sources of energy for the world in the long-haul. Statistics and global trends tell it all!

• Growth in total investment in renewable energy is reported to have grown by an average of 36

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% between 2004 and 2010, and to about 260 billion USD by 2011.

Total investment in renewable in 2010, including hydro power generation, exceeded gross investments in fossil fuels (about 220 billion USD, which included the costs of decommissioning existing power plants); although renewable energy accounted for less than 10% of the world capacity, nearly the same amount of new generation capacity was reportedly added compared to energy from fossil fuels (about 87GW compared to 92GW respectively) in 2010; excluding hydro power which is expected to receive a major boost in 2012 and beyond from countries such as China, additional capacity from renewable energy is expected to grow to about 80 GW in 2012 from about 60 GW in 2010, a phenomenal 33 % growth with a strong prospect of boosting further investment and establishing confidence in the energy markets world-wide; investment in solar technology in 2011 nearly caught up with investments in wind power generation, whilst in Europe and USA renewables accounted to about 30% of newly built power generation capacity, and soon to overtake total investments in fossil fuels (excluding, however, upstream infrastructure costs- coal mines, etc); Prices of photo-voltaic modules went down by 60% between 2008 and 2010 and still dropping; The International Energy Agency predicts that solar powered generators will account for the largest production of energy by 2050 by which time the world’s increasing electricity demand might have doubled and at approximately 60 to 80 % of total energy demand; a daunting task and serious risk in terms of reductions in carbon emissions if fossil fuels are to remain dominant in the energy markets, although giants like Exxon Mobil would want to tell us otherwise!

For Botswana in particular, a country looking to cash in from its vast coal deposits, it is prudent to place a bit more attention to events in China, Europe and USA. For this installment, let us consider China: Despite that country’s current huge appetite for coal driven by its soaring energy demand due to its ballooning population, the country is taking the lead in the development and investment in renewable energy in several fronts. China reportedly invested nearly 50 billion USD in 2011 and more than 33% of total global investment in renewables. The country was also the highest in the world in newly installed wind capacity (about 43GW) in 2011, and the largest in asset finance in new build wind renewable technology and still growing according to the Bloomberg New Energy Finance Report. China is reportedly targeting a minimum of 15% supply of energy from non-fossil

fuels by 2020, and may be well on her way to 100% by 2030, a mere 18 years from today. It is estimated that 55% of PV modules world-wide are manufactured in China. In terms of existing solar power plants in 2011, China still led the pack at 200MW although some of the largest solar power plants (up to a total of 2370 MW) under construction were to be found in the USA and some in Germany, Brazil, etc. The country has reportedly and recently announced its plan to further and significantly boost investment in new hydro-power plants, nuclear and shale gas in recognition of the increasing price of coal and oil. Unlike in UK, for example, where new sites for large hydro-power plants are no longer available, and due to the issues of habitat and ecological impact, this does not appear to be a constraint in China any time soon. China is also offering examples in the design for energy efficiency and sustainable cities as part of its plan to temper its energy demand.

The country’s investment is renewable energy technology is expected to continue to outpace any in the world, in the years to come, including the USA. Evidently, Botswana’s largest potential consumer of coal has other plans strategic to its energy security in the medium to long-term, despite the promise of CCS technology and capacity of the world’s planetary reserves to last another 65 years. It would appear that, for China, energy from coal is a short term stop-gap measure; a worrying trend given that existing coal fired power plants can be adapted to be cofired or fuelled entirely by solid or liquid biomass, and given the fact that there is a growing trend to invest in smart technologies that integrate energy production from biomass with biological waste treatment in building projects as well as the promise from and growing interest in bio-fuels for those countries endowed with the right environment and capacity to promote growth in this subsector.

Despite its vast coal reserves, Botswana, a country endowed with some of the highest solar irradiance and longest daylight hours should well be advised to seek its fortunes elsewhere. That fortune evidently lies in investments in solar technology and its myriad of related smart technologies: Digital and/ or optical energy, storage batteries and fuel cells, smart grid, etc. The country must move with speed to liberalize the energy market and provide an enabling and conducive environment for investment in this sector, whilst pursuing a carefully and delicately balanced drive to expand the capacity of coal fired power plants which could well become obsolete in the next 20 years. It, invariably, has to come with bold sacrifices in the dominance of the State-OwnedEnterprise, an entity which would be conflicted to be in the driving seat of such a program.

What is the story in USA and Europe and how might it further impact on Botswana’s fortunes or misfortunes?

What window of opportunity exists with CCS technology in the solar age?

Next on Boidus Focus!

BOIDUS FOCUS Tuesday 01 May, 2012

Editorials Page 5

PLAIN TALK BY JOWA

Traffic Chaos and Lack of Landmarks: Two Sides of the Same Coin

by Jan Wareus, Architect / Town Planner

For a start, I have to reply to a comment – How do I think that we, tied up by a SACU treaty, can produce our own construction material to competitive costs?

Well, I’m not a dormant politician but as far as I know, it is quite possible that Botswana could exempt VAT from local products. That would be a good start, I think.

It can probably be illustrated by the pictures below from Jwaneng (planned 1977-1979) and a phase of Gab West (planned late 1988).

There have been some articles in our papers about traffic chaos and lack of landmarks in the city. To this I will now dedicate this column and I do not separate the two issues, in fact, I think they are just two sides of the same coin.

I was so interested in the planning background for Gaborone that I went to the National Archives to find some early planning documents. The librarian was very astonished to see the first planner ever visiting him.

I’ve got the approved or accepted layout for Gaborone from him. And that’s more or less exactly what you can see in the old part of the city today. But also an early alternative that convinced me that the used “garden city” concept wasn’t just a mere idea amongst others. I have a copy of this early alternative below.

Jwaneng (planned 1977-1979)

Gab West (planned late 1988)

Looking at the Jwaneng neighbourhood portion we see that the Setswana Medium School is very central in the “hood”, not easily reached by car but within easy reach for walking children.

In Gaborone West the schools have moved closer to secondary roads to become more easily reached by cars.

The reason – educational policy had changed and many school sites were allocated to private developers for English Medium Schools.

There was no announced policy shift from the Ministry of Education but planners adapted to what had become the song of the day – and tried to save the “hood” from disturbing traffic. For Secondary Schools, even more attractive to private developers, the norm was to site them close to Primary Roads for easy access. However, such roads were often in the hands of Roads Department (being gazetted) and they were most often denied direct access e.g. Rainbow and Westwood schools.

But the traffic disaster is partly due to this privatization of schools that could not be foreseen at the planning stage. When their number became significant, and every second private car in mornings had to deliver children to their private schools, a kind of coupe de grace was given to the traffic situation in Gabs. Enhancing this was naturally (to planners) the unforeseen support by banks, council and government of private car ownership. So we now have a great number of bank-owned cars with children taken to schools every morning. So much that the Director of Roads, supported by Council and elected MP’s, seems obliged to deconstruct the original roundabouts and create a small Los Angeles.

That, as we all have experienced, works even worse than the now deconstructed previous system.

Here you find all the significant conceptual features for a classical garden city - neighbourhood units, curved streets/roads, schools and shops in the middle, possible to reach by foot within acceptable distance (1/4 of a mile=app. 400 m) and vehicular roads with roundabouts (for slow and easy moving traffic).

All this was accentuated in the final, implemented layout (plus more roundabouts). In 1979 all was still functioning well and actually the newly constructed Gaborone was a landmark in itself! Many visitors convinced me of that and I found no reason to change “planning attitude” for the Gab West planning.

Consequently, Gab West can be characterized by the neighbourhood units and curved streets/roads and the first phases by the schools and shops centrally located, and naturally, a traffic system based on roundabouts (to keep up with the then admired landmark image and proper function).

But for the schools, something happened during the de-

Designing for People Living with Disability

An Architect's Contribution to an Accessible Botswana by 2016

by Larona Motlatse Kgabo / Architect (DBES/MIST)

tailed planning period.

So, I’m still awaiting my sticker for the car from Boidus - BOTSWANA MUST SECURE A PRODUCTION OF BUILDING MATERIALS OF ITS OWN!

Arriving here in January 1979, I became fascinated by the then small Garden City that had just taken a step over the Segoditsane River to Broadhurst and expected further growth to the west of the railway – the reason for my recruitment, actually.

YOUTH, ARCHITECTURE & THE BUILT ENVIRONMENT

For more reading about this I recommend the interviews with Luc van der Casteele in Sunday Standards (two so far and more promised). Excellent analysis of the current, “improved” traffic system!

That, as well as the school concept, have become modern “planning disasters”. I’m mentioning this as I, in year 2000, was invited to UB to talk about “The Problems of Urban and Regional Planning in Botswana” and wrote a paper about “Planning Disasters in Botswana” instead.

Basing this on the then acute Mogoditshane squatting and subsequent “yellow monsters”; as well as the socalled Urban Standards (presented by DTRP totally void of any research and earlier standards). We are coming back to these historical events if you are interested.

So, I guess I’m back to “Planning Disasters in Botswana” with this column.

There are more disasters, though. Next column will be dedicated to an ever ongoing bureaucratic belittle of a grand scheme of improving the environment of Gaborone.

Reigning Miss Universe Botswana 2011/12; Youth Ambassador - DBES/MIST; Course Ambassador - New Venture Creation / Botho College; National Coordinator - Teenagers Ministry Botswana [The author writes in her personal capacity]

Status, at a glance across all pillars by key result areas, according to the vision 2016 website indicate that some progress has been made towards the realisation of our vision 2016. However, generally as a nation there appears to be so much left to be done still, at both individual and corporate level- especially with only 4 years to go to the year 2016. I wonder if people ever ask themselves what their responsibility, or involvement will be towards the accomplishment of this National Vision at a personal level. Common in our society is the mentality that the responsibility for everything is all laid upon “The Government”, but as I see it, it’s good habit for every Motswana to learn to assess their individual possible contribution towards national goals.

I invite you now to travel with me on this journey to see what we can do together to take one more step towards vision 2016. Professionally architects, landscape designers, civil/structural designers, and other designers of the built environment can do so much to contribute to the realization of all pillars of vision 2016. On this essay I will focus on contributions towards Pillar Number 3-‘a compassionate, just and caring nation’.

As designers of the built environment, we can contribute immensely in expression of our compassion through the kind of infrastructure we design; one which is user-friendly to Persons with Disabilities.

Designing to meet these needs should not even be subject to negotiation as failure to do so would equal to professional negligence. For example, no architect should design any structure without making an allowance for access, use and circulation at the level that caters for people living with disabilities. If such a hostile building exists, by guidelines of building audit it should not qualify for occupation. Buildings act as the stage for human interactions; these interactions may exist among human beings themselves, or among humans and their hobbies, or between people and services. By designing buildings that discriminate a man walking using a wheel chair, or a woman using a cane to guide them through or the child who cannot hear, we are indirectly saying that they are undeserving of these interactions.

By designing such buildings, we are saying that immigration services are not for them, or that a shopping experience in a shopping complex is not for them because the structures that pass our design-stage audits are not welcoming to people living with disabilities. In this country where every child, every young person, whether with or without disability, has the right to education and health facilities; how will we achieve that if our schools, hospitals, clinics and health posts are not friendly to people living with disabilities!

Of all the forums that I have been a part of which had representation from PWD; the Youth Pitso, the United Nations International Day for people living with disabilities, the Ministerial Day for

People living with disabilities, a general grievance was raised about infrastructure- particularly buildings, as a major challenge faced by PWD in their daily interactions. Clearly it is not enough to have an access ramp into your building; it has to conform to the design standards for a person with disability. The same thing goes for curb cuts, car park bays, accessible elevators, for ablutions and floor treatments; all these need to pay some attention to the living needs of people with disabilities. When one moves around city centres and town centres, upon observation, one will begin to realise the shortcomings of most buildings including those that have become homes to offices that render public services. A call also goes out to all academic environments on design to put some emphasis if not all on matters relating to designing for people living with disabilities. Technology also takes a significant role in this area. For instance, there are many examples of assistive devices for people with manipulative and locomotive disabilities. These devices enable people with disability to perform many activities of daily living thus improving their quality of life. Remember disability is not inability so people living with disability are increasingly able to lead an independent life and play a more productive role in society. In the case of children and young people living with disabilities, such assistive devices have been shown to be critical to their cognitive, physical and social development.

His Excellency heeded to the call by introducing the Office of People Living with Disability, functional under the Office of the President, as a way to foster an environment that brings their concerns to the surface. Their primary concern- which is infrastructure, is to us as architects, designers and engineers of the built environment, a primary expertise. So if you happen to make up this group of professionals, be diligent in your quest to create environments that work, environments that are user-friendly and inviting to people living with disability. As it stands, the status at a glance across pillar number 3 by its key result areas, still according to the vision 2016 website shows a 23% progress which clearly calls for more increased efforts towards this.

As the makers and care-takers of the built environment this would be your personal and professional contribution to the attainment of vision 2016 pillar number 3 of Botswana being a compassionate, just and caring nation expressed through her infrastructure! In the following article, more shall be expounded on with regards to our individual responsibility in ensuring that these environments are actually birthed and also share on what I am currently doing therefore as a young woman architect with a national responsibility by virtue of being the reigning Miss Universe Botswana 2011/12, to contribute positively to the lives of people living with disabilities. Until our next issue, keep loving yourself and your environment!

Advertorial Page 6

BOIDUS FOCUS Tuesday 01 May, 2012

BOIDUS FOCUS Tuesday 01 May, 2012

Building News Page 7

CBD's Exponential Towers Near Airport Junction On Time; Newest Retail Mall Completion - Knight Frank

by Keeletsang Dipheko / Images © Khumo Properties

by Boidus Admin / Images courtesy of Knight Frank

Exponential Towers

...a landmark office facility now being let by Knight Frank Botswana

Exponential Towers is situated in a stunning location within Gaborone providing a landmark office facility in one of the most prominent positions in the new CBD. Just opposite Exponential is the entrance to the hotel element of the recently opened Masa Centre.

The available accommodation is arranged over eight floors encompassing 9,000m2 of prime office space with penthouse accommodation on the upper floors.

The building is part let and there are ongoing negotiations with two tenants to take the majority of the building between them. There are some smaller units available to let and the possibility to take a whole floor is also still there.

For Further Information +267 3953950 joe.simpson@bw.knightfrank.com

>>> FROM PAGE 01

leasing, investment broking, and valuation.

As a Commercial Developer, Khumo Properties Management has always been winning the race for producing and developing new premises or redeveloping existing ones. Khumo also is able to act as a consultant on a fee basis or as principal in assuming all risk throughout the development process.

Khumo’s Portfolio • Asset management mandate for Debswana Pension Fund property portfolio • Development partner mandate with Botswana Rail on several properties • Development of 7 500m² office block for Pension Fund - Gaborone • Management of Rail Park Mall, a new regional shopping centre (30 000m²) in Gaborone.

• Development of Airport Junction, a new regional shopping centre of 38 000m², currently under construction.

• Property development, property management and leasing services in the Botswana market

in Botswana at 38 000sqm surpassing Game City, currently at 30 000sqm. The mall will also be seen as a regional mall that can pull shoppers from neighbouring countries.

The first phase of the malls larger context has already been completed and this brought to town , Builders Warehouse brand and also Botswana’s first drive through service at the KFC restaurant.

The development has a good parking ratio and the tenant mix consists some of the following national tenants;

SPAR / Shoprite / Truworths Group / Pepcor Group with Ackermans and others.

Professional Team Architects: Frans Farmer Architects (SA) and Arctez (Botswana) Quantity Surveyor: MLC (Botswana) Civil/Structural: ADA Consulting (Botswana) Project Management: C-Pro(SA) and Shilo Consultants (Botswana) Electrical Engineering: Quad Africa (SA) and A.R.Edwards (Botswana) Mechanical: WIN Consult (SA) and A.R.Edwards (Botswana)

Internal Artist Impression

The Airport Junction The airport junction mall, located at the junction between airport road and the A1 to the north is preparing to open its doors to the public on the 27th of April.

The mall, which is a flagship development by Khumo properties will boost a variety of new international shopping brands, notably amongst them the retail giant Checkers and a many other exclusive brands.

The Airport junction will effectively become the biggest indoor retail mall

Site Location Map, prominently located adjacent to the A1 freeway and Airport Road

Feature Analysis Page 8

BOIDUS FOCUS Tuesday 01 May, 2012

Commercial Property Development in Botswana

by H. Killion Mokwete and Keeletsang Dipheko

T: +267 751 41 236 E: tshiamo@boidus.co.bw

GLOBAL CONTEXT: Global Commercial Property Prospects 2012 (Cushman &Wakefield /Knight Frank Global Reports)

Boidus Pty. Ltd. P.O. Box 50097, Gaborone WHY BOIDUS? • the consumer of the built environment needs to be in a position to access information regarding what the architectural industry is up to • a platform for discussion and discourse needs to be created where open, earnest discussions on important issues take place

T: +267 741 31 671 E: abo@boidus.co.bw

ABO

T: +267 715 01 301 E: thabo@boidus.co.bw

Construction Industry Architecture Built Environment Arts & Culture Property Investment

AND REACH YOUR CUSTOMERS

THABO

TSHIAMO

T: +267 755 05 291 E: killion@boidus.co.bw

KILLION

ADVERTISE YOUR PRODUCTS HERE

GABORONE

FRANCISTOWN

>>> FROM PAGE 01

According to early reports by the influential Cushman & Wakefield, International Investment Atlas and Knight Frank Global, Global Real Estate Market, Annual Review and Outlook 2012, commercial property investment volumes rose moderately in 2011 compared with 2010 at a global level.

It is anticipated that annual transaction volumes in 2012 will be similar to 2011, albeit the second half of the year is expected to be stronger than the first half. Investor caution, continued constraints on debt financing and a lack of large-scale transactions have led to reduced investment volumes in early 2012 in a number of international markets. However, activity should improve if wider economic conditions stabilise over the course of the year, particularly

Source: Knight Frank Research [Global Real Estate Markets, Annual Review and Outlook 2012]

in the Eurozone.

Many African economies continued to grow at an impressive speed in 2011, with the global slowdown having a relatively limited effect on the continent. The IMF forecasts that annual GDP growth in Sub-Saharan Africa will continue to run at above 5% over the next five years, although serious challenges, such as infrastructure difficul-

ties and skills shortages, remain present in many countries. Any slowdown in China’s economic growth would also cause concern, as it has become a hugely important trade partner and investor in Africa.

Africa’s emerging property markets have continued to develop, supported by strong economic growth and increased foreign direct investment, particularly from China. However, high quality office space remains in short supply in many cities.

Knight Frank Global report highlights that although economic development across Africa has supported the growth of its commercial property sector, commercial property markets outside South Africa generally remain small and underdeveloped, with many major cities having a limited stock of high quality office space. However, African retail property markets continue to grow. While small-scale informal retail activity remains very common, modern shopping centres targeted at Africa’s growing middle class continue to be built across the continent.

Source: Cushman & Wakefield [RCA, KTI and Property Data]

Botswana's Commercial Property Market KEY ECONOMIC DRIVERS OF COMMERCIAL MARKET IN 2012 • Interest rate fluctuations • Budget and reduced government spending • Relocation of DTC to Botswana to spur high-spec industrial units development • Economic diversification through development of Hubs such as BIH The Knight Frank Global report notes that, ‘The development of the new Central Business District in Gaborone, Botswana, is expected to have a major impact on the city’s office market in the coming years.

While a limited amount of space has been completed so far in the new district, nearly 90,000 sq m of offices are due to be delivered in 2012 and some 200 000sqm is expected in total, most of which will be completed on a speculative basis. A number of major occupiers, from both the private and public sector, are planning to move to the new CBD, which may cause availability to increase in the city’s existing business parks.’

Asked about the possibility of oversupply of commercial property developments in an earlier Boidus Interview, Dr Keith Jeffries of Econsult also agreed that there could soon be an oversupply of office space due mainly to major developments in the CBD and Fairgrounds.

This argument is shared by Turnstar Holdings Limited’s Managing Director, Mr Jakes Motlhabane (interviewed by Worldfolio - AFA PRESS) who said, “I have noticed that no new businesses are coming into the market, so if you create more office space, there will be an issue of oversupply in the next 18 to 36 months.

“Oversupply is more likely to bring stagnation or a reduction in market rents. But the good thing is that Botswana is a developing country, so we will continue to have those kinds of developments.

But whether there is undersupply or oversupply, it is a free market and economy, and it will correct itself. There will definitely be casualties due to this correction."

According to the Cushman and Wakefield’s Global markets report 2012, emerging markets are likely to continue to perform well due to factors such as urbanisation and population growth, the increasing size and affluence of middle class, increased industrialisation and resource exploitation, increased raw material pricing and financial markets maturity and development.

EQUITY INVESTMENTS IN THE BOTSWANA PROPERTY MARKET The Botswana Stock exchange is continually welcoming into its fold of new domestic companies as property owners and investors seek

Commercial Development Areas in Gaborone

to gain exposure to the property sector. Out of the twenty three listed companies, six are directly dealing into the property market.

This is a positive sign that the industry is increasingly attractive to investors.

1.

2.

3.

4.

5.

6.

Turnstar Holdings Limited New African Properties Limited lympia Capital Corporation (Botswana) Limited PrimeTime Property Holdings Limited RDC Properties Limited Letlole La Rona Limited

The companies have been instrumental in attracting to Botswana much of the mining exploration and development which now underpins the country’s development strategy.

BOIDUS FOCUS Tuesday 01 May, 2012

Feature Analysis Page 9

LOCAL PROPERTY MARKET STAKEHOLDERS VIEW - Knight Frank, Apex Properties, Stocker Fleetwood Bird STOCKER FLEETWOOD BIRD

It is an interesting time for commercial property. The nature of the market is changing and the investor base widening as new vehicles for investing in commercial property have made the market more accessible. From the occupational side however, we are entering a period of uncertainty as substantial new developments are scheduled to be delivered within a short time frame.

Q2. What is value, in Pula terms, of the commercial property market in Botswana?

There your guess is as good as mine; there is no statistical information on the actual property values in Botswana. Even the listed property stocks have small market caps which is less representative of the true market value. REIB is trying to develop a data base to help quantify this information.

Q3. The growth of this sector has been accelerated over the past few years by drive from private investors, why do you think this sector has been so attractive for investment?

The attractiveness of commercial property in Botswana has been supported by a scarcity of product, which has driven rents up while there has been yield compression as capital values have risen. In particular one can note the historic lack of good quality office space and the expansion of South African retailers into Botswana which has fuelled the development of the retail sector.

This is driven by a basic need to realise good return on investment and the profile which commercial properties provide if you are trying to grow your investment portfolio.

Yields or ROI in commercial properties can be easily measured, hence informing the investor of their return.

Q4. What are the key steps to developing a successful commercial property development/ investment in Botswana?

Do your market research. Think about the product and who it will appeal to, is there a market to support it when complete? Information here is limited. I keep seeing in the press major institutions complaining about the lack of market information available in Botswana, but for the most part there is a reticence to pay for independent research and data to assist in making informed decisions.

The key to investing in commercial property is to have set goals and targets and engage a property specialist to do that for you. The “I can do it myself” attitude doesn’t work.

If you look at the successful property barons and investors, they have property experts on their side and they follow a set pattern and understand the market movements and growth areas.

Q5. With so many commercial developments coming up across our cities, what is the danger of market saturation of commercial developments in Botswana?

In certain sectors of the market, the danger is high.

The danger with a saturated market is that a few casualties might be seen. But from the current situation, it is highly unlikely that there will be any casualties, maybe the rentals might get corrected.

Decline in property values.

Q6. What consequences would a saturated market have?

I am actually of the view that the vast majority of new schemes coming through will be a success and we will find there is sufficient demand to support them. However, this will highlight the abundance of secondary grade office stock and it is this market where we are already seeing rents tumble. In the CBD most schemes are well thought out, those that aren’t may struggle to attract tenants at the rents they are demanding.

Practically a saturated market will result in higher vacancy space and rent reduction to incentives tenants. It just makes the market a tenant’s market as opposed to the landlord’s market.

A saturated market is basically an oversupply of commercial space; this causes property owners’ to compete for tenancy thus causing prices/ value to decrease.

Q7. How can we avoid market saturation?

The planners could look at allowing more residential development/mixed use schemes in certain locations possibly prone to saturation

You can’t avoid that, this is the laws of economics and physics; there is always upward and downward movements.

When economic dynamics change, they can result in oversupply or under-supply of property. Hence, saturation, just like shortage, will always be there in any property market.

Regulation and Government Directives slowing down expansion/ development allowing supply-demand to come into balance.

Q8. What will be the key to commercial property market’s long term sustainability and growth?

Long term, the performance of commercial property is dependent on the overall performance of the economy. While there is an expanding economy and job creation, space will be filled. The overreliance of certain sectors of the market on public sector institutions provides uncertainty should the austerity measures employed by the government over the last two years return, in which case we will need to see greater stimulus for the private sector.

The key is to develop quality property portfolios and retain good long term tenants. A good mix of property assets will help sustain and maintain the market as all the sectors will be well represented.

Q9. The global recession currently gripping the world is having adverse effects on the entire construction industry.

How do you think our booming commercial property market will be affected by this global recession?

There is notable caution from multinational organisations when expanding anywhere in the world and decision making times have become ever longer. However, SMMEs and locally based organisations are more willing to make the leap and their confidence is helping sustain the market.

Ours is unique, our construction industry is heavily reliant on government and government’s revenue has been hit very hard, the diamond sales have dropped drastically and this has affected government’s capability to do projects.

Private sector developers have managed to develop commercial models which are viable even when times are hard.

They deliver projects on time and on budgets thus saving the client money. Construction industry in Botswana, has never had the inclination to save the client money, this resulted in crippling the clients’ resource with cost overruns which had become part of the package.

Entirely dependant upon where the property is located in Botswana, I would recommend that returns of 8% (new prime positioned properties) to 12% (older, secondary location) are common. Preferable to invest in Industrial property at the moment.

Q10. Often the commercial property market in Botswana is concentrated around retail & office developments. What other alternative commercial investments are there in Botswana that can be invested in?

Industrial, hotel and leisure...

Investors could look at hotel and tourism investments or Industrial property investments. These are some of the sectors which are lucrative, but are run on an ad-hoc basis, they are fragmented. If they can be developed and coordinated properly they can draw good returns as their counterparts.

Industrial.

Q11. Funding commercial property involves big monies and structured financing, how and where can a potential developer access funding for their commercial developments?

What is usually the key to securing commercial property financing for a project?

In addition to the usual sources, joint ventures are also a possibility.

All commercial banks in Botswana can fund any commercial development, provided it is within their risk profile.

They have set guidelines, which help the developer to have a sound project proposal. I know some people feel these are prohibitive, but for risk management, those have to be followed. There is a requirement for a good track record in delivering such projects, excellent balance sheet and key personnel. It is not child’s play to do a development and hence it requires good and prudent techniques. A sound project, which meets all the risk management of the financial institution will always secure you project finance. Also engage experts in securing project finance, so that they structure your finance effectively and help save on finance charges, which if not watched can eat on the ROI of any project.

Any bank/ building society registered with the Bank of Botswana.

Market Saturation

Property Market in Botswana

Q1. How can you describe the current state of our commercial property market in Botswana?

World Recession Impact

APEX PROPERTIES / Maje Maje

Commercial Property Funding

KNIGHT FRANK / Joe Simpson

Internationally, access to finance could become an issue – but in Botswana where there is a weight of money held by cash rich investors and targeted at the local market, I do not envisage the prime market taking a hit.

a reputable bank valuation, supported by a good business case/concept and perhaps a deposit

The current commercial market is still buoyant and we anticipate it to continue in the short to medium term. We are still realising good yields in the market, which ascertain that the commercial property market is good. The yields which are being realised in the commercial property sector far out weigh the competing yields such as interest rates from the commercial banks and the returns which have been realised from the shares market.

Currently a Property Owners’ market in the sense that the past few years have seen high demand for commercial property investment / letting thus causing values to increase – currently at its peak.

You’d have to get this info from Central Statistics Office.

Economic Stability.

There are several requirements and these vary from lender to lender and from time to time – probably best to consult with a lender on this one.

Boidus Exclusive Page 10

BOIDUS FOCUS Tuesday 01 May, 2012

Government Should Invest Capital In Affordable Housing - BHC, M. Majingo

by H. Killion Mokwete and Mpho Mooka >>> FROM PAGE 01

[BF] Why is Botswana failing to provide quality housing for its citizens?

[MM] Quality housing can only be provided where all stakeholders effectively play their role in the provision of housing.

The first category of stakeholders being private developers seem to be focused on providing housing at the top end of the market in major towns and cities , and they are often limited by access to serviced land.

The second category of stakeholders are various government entities, and these include among others BHC and SHHA. In its endeavour to provide housing, BHC is limited by availability of land in strategic areas where there is proven demand and its target market (being the top end of the low income group to the bottom end of the high income group).

The third category of stakeholders are individuals who will be happy to be allocated land by government, whether tribal or state land, and go through the motions of developing it at their own pace. A good number of Batswana fall in this category and some have failed to develop houses for themselves due to long waiting lists in these areas.

It is clear therefore that more money needs to be invested into housing if indeed it is basic human right Government is investing millions of Pula in say Education or Health. Why not the same investment in housing especially in infrastructure?

[BF] Most people assume that BHC’s mandate is to ‘provide affordable housing for Batswana’, could you clarify what the actual mandate of BHC is?

[MM] The mandate of the Corporation has no specific reference to “affordable” housing. As captured in the Act, the mandate of BHC is to: • provide for housing needs of government and local authorities • provide and to assist and to make arrangements for other persons to meet the requirements of paragraph (a) • Undertake and carry-out and to make arrangements for other persons to undertake and carry-out housing schemes in Botswana.

While the issue of affordable housing is not specifically stated in the Act, one would surmise that it is implied, as the Corporation’s strategy on housing development has to complement government’s efforts in housing the nation. Being a state owned enterprise, it is rightly expected that in its housing development

efforts, BHC will not be solely driven by profit generation as is the case with private developers. However, in its pricing strategy, the Corporation would be mindful of the need to run as a going concern.

This inevitably means that the Corporation has to strike a balance between the cost of developments and its capacity to pay off loans derived from the market.

This is necessary as unlike some state owned enterprises, BHC does not benefit from annual government subventions.

[BF] Why has this mandate gone for such a long time without amendment?

[MM] The mandate of BHC is quite enduring and not time bound. It is also expansive in nature as it enables the Corporation to facilitate provision of housing by other players in the property development industry. Even with the advent of a single housing authority driven by BHC, the Act would not have to be amended as it is not restrictive or prescriptive as to types, quality and cost of housing projects to be developed. The passage of time has of course led to operational refinements and strategic shift in favour of empowering citizens with home ownership as opposed to ‘throwing hard earned money into a bottomless pit’ through perpetual rental payment.

It is notable however that the mandate was marginally reviewed in 1994.

Sector Led Discussions [BF] Please also share with our readers, challenges and problems that BHC faces in its task of providing housing.

[MM] The first challenge is allocation of strategic land endowed with services. The Corporation is not given priority by land authorities, be they Land Boards being custodians and administrators of tribal land or the Department of Lands being custodians and administrators of state land. Like private developers, BHC applies for land and the Corporation is not given preferential treatment. This has led to waiting for a long time for allocation of land in key areas with proven demand for the Corporation’s products.

The second challenge is the cost of infrastructural developments. On average the cost of infrastructure accounts for 25% of construction costs. This cost covers water and power reticulation as wells as sewers and roads. It takes a huge capital outlay to provide the necessary infrastructure. By providing infrastructure, the Corporation is effectively subsidising other organizations that reap the rewards of the capital investment in perpetuity. The Corporation’s view has always been that this cost should be absorbed by government or relevant institutions in the interests of making housing units affordable.

[BF] There is a general feeling that BHC’s presence in the Housing market in Botswana distorts house prices as people use BHC prices to bench mark and also that BHC competes unfairly with private developers in accessing land and servicing. What can you say about this?

[MM] It is not true that BHC distorts housing prices. In any economy, pricing of houses is determined by the cost of providing such houses and that is often balanced off by the dynamics of demand and supply. As the biggest developer of houses in Botswana, there is no way the Corporation could be a follower of smaller or individual developers in the setting of prices for houses. BHC is a leader in housing development and operates in the national market. It would be absurd for smaller developers to claim that they have sub-markets under their control that are distorted by BHC’s pricing strategy.

On the question of BHC competing unfairly with private developers; it has already been highlighted that the Corporation is not given priority or concessions either by land authorities or utility providers.

Regarding ‘buyers’ market’, the Corporation’s strategy in pricing its products is guided by the total cost of development plus a nominal profit margin. Hence, pricing is cost driven, and not determined by buyers. However, as a state owned enterprise, affordability of the Corporation’s products is central to the pricing strategy and the Corporation would not develop products that would not sell.

[BF] Land, materials and servicing costs are some of the key issues sited as contributing to high house prices. What could be done and especially what is BHC doing to provide cheaper alternatives to the above issues of land, materials and servicing?

[MM] Land: wherever possible, having in mind the dynamics of demand, the Corporation conserves land by developing high density structures. Owing to acute shortage of land in urban areas, the Corporation has embarked on a densification drive that seeks to achieve optimum land use in the Corporation’s existing high density developments that were sparsely developed. The project has been embarked upon initially in Gaborone.

Materials: Not much can be done about this as the cost of materials is supplier controlled. However, the Corporation procures the services of contractors through a tendering procedure that allows it to maximise purchasing power and obtain optimal pricing through competition. The Corporation has piloted a labour only project, the reviews of which would be done during the second quarter of the next financial year. The objective of this was for the Corporation to source materials directly from the market, therefore cutting out mark-up on material cost by the Contractor and passing the benefit to customers through lower pricing. There is need however for the Country to seriously consider establishing its own material manufacturing factories.

Servicing of land: since on average, the cost of servicing land accounts for a quarter of the total cost of construction, the Corporation would prefer to have the government subsidising infrastructural costs or the utility providers footing the cost as they would in time reap the benefits of such infrastructural investment in perpetuity.

[BF] What is BHC doing to improve its house quality to ensure buyers get value for money and also could you share with our readers what your future plans are?

[MM] BHC continues to review its designs from time to time to ensure that buyers get value for money without compromising structural integrity.

Reputable and technically competent contractors with a proven track record are engaged to deliver BHC’s products. There is also a system in place for achieving quality assurance by close supervision of projects and making provision for durable competitive specifications.

The future plans are to aggressively venture into a land acquisition drive that will enable the Corporation to prepare land in good time for planned projects. As stated above, for the Corporation’s existing high density developments, people will begin to see the densification project starting and more housing units developed and availed to the market. With the Corporation having been designated as a single housing authority it means that BHC will become more visible in rural areas through the development of district and SHHA housing.

BOIDUS FOCUS Tuesday 01 May, 2012

Education Page 11

There is still a room for Artisans; Construction Industry Trust Fund (CITF)

by Esther Amogelang / Image Source: CITF Construction Industry Trust Fund (CITF) is a centre for crash-course training using Competency Based Modular Training. The fund’s purpose is mainly to train Batswana to be artisans such as bricklayers, carpenters, painters and all other programmes that are involved in the construction industry. The fund was established so as to meet the needs of the building and construction industry without having to rely on imported or outsourced skills.

tisan from CITF stands out in that the competencies offered at CITF are actual on the job tasks and projects are life size. This being the case, an artisan will have experience in the construction work therefore not much of tasks will come to them as a challenge.

According to CITF Public Relation Officer, Ms Abigail Dandy Ntlhaga, upon finishing training and having demonstrated mastery of tasks, the trainees registers with Public Relations Office.

This is done to help the trainee penetrate the Construction market and start working.

Ntlhaga admitted the bad misconception from the general public that construction related courses are not that important. In trying to break such a bridge or the misconception, CITF goes around schools sharing information about the importance of skills that are acquired. CITF also takes part in the Consumer Fair every year where in their stall they have trainees demonstrating their acquired skills, they build a small cottage house with everything a complete house would have in it - tiling, plumbing, electricity you name it, all of it inside the fair’s venue. It is then explained to them that small to big construction companies hire the CITF former trainees and are, in most if not all cases, satisfied with their skills.

She however said, with so many graduates from recognized and top class universities around the country, an ar-

When asked about the challenges the centre is facing, Ntlhaga explained that just like any other organisation

There are no specific qualifications required to enrol at CITF, except that literate, semi-literate or illiterate Batswana men and women need to be aged 16 or over and should be able to read and write.

About CIFT Courses: Competency-Based Training Centre for Batswana COMPETENCY BASED INDIVIDUALISED MODULAR TRAINING (CBMT) > CITF provides training programmes using CBMT, which is a systematic approach to skills development in order to perform work-based or occupational tasks. Competency refers to an individual’s demonstrated knowledge, skills and attitude displayed to a specific standard to attain intended results or outcomes. The CBMT system is flexible and provides for the following: • Open entry/Open exit: Any trainee can enter and exit the system at any time, having demonstrated mastery of tasks, following completion of training programmes.

• Self paced: The system is individualised, therefore allowing trainees to work at their own pace, do self checks and request to test when ready to do so.

• Tailor made: All competencies offered are actual on-the-job tasks and projects are life size.

• Recognition Of Prior Learning/Recognition of Current Competence: Recognition of prior learning (RPL) is a process whereby through assessment, credit is given to learning which has been previously acquired in different ways- other than formal methods.

Trainees are allowed to demonstrate previously-acquired skills and are tested before undergoing training.

COURSES OFFERED > CITF offers the following skills training programmes for the building and construction industry: • Bricklaying • Plastering • Carpentry • Plumbing and Pipe Fitting • Electrical Installation • Tiling • Painting and Decorating • Welding and Fabrication • Civil Engineering Construction: • Site Surveying • Shuttering/Formwork • Steel Fixing • Scaffolding Erector • Concrete Hand • Heavy Plant Operator • Safety and Health • Supervision and Site Management • Estimation and Tendering WHO USES CITF SERVICES > CITF gives priority to the building and construction industry. However, government employees and individual Batswana interested in the building and construction are encouraged to apply in order to acquire the skills necessary to assist in obtaining building and construction employment.

ENTRY REQUIREMENTS > No specific qualifications are required to enrol at CITF, except that literate, semi-literate or illiterate Batswana men and women need to be aged 16 or over and should be able to read and write.

DURATION OF COURSES > Since the emphasis is on the acquisition of practical competencies, CITF is able to produce competent semi-skilled artisans in 4 to 12 months.

WHERE TRAINING TAKES PLACE > Training is carried out at CITF main centre in Gaborone. CITF has Mobile Training Units (MTU) which provides on-site or close to site skills training to improve the quality and productivity of artisans in the building and construction sector. Heavy plant training is only carried out on site because of the prohibitive costs of acquiring machinery.

HOW TO CONTACT CITF > Contruction Industry Trust Fund Private Bag BO 122, Gaborone Tel: +267 3911362 Fax: +267 3906380 Email: administrator@citf.co.bw Plot 18006, Samora Machel

the centre faces different challenges, amongst them shortage of funds. The centre lacks funds that can help extend its services to other places around Botswana, to mobilise the fund to places like Francistown, Mahalapye, Ghanzi and other places. The other challenge that the Fund faces is the fact that it does not provide trainees with accommodation, therefore it is hard for people who stay far away from Gaborone but wish to train at the fund to actually be able to do it.

Moreover, she advised hopeless form three/five students who are just roaming around the streets not knowing what to do that working with their hands, particularly in the construction industry, is not an inferior domain.

The building construction is a flourishing industry in Botswana seeing as the country is growing in every possible meaning of the word. She emphasized more on the need to know that there are essential elements for success in anything. “Dreams and goals will be achieved only when people realise that success and potential are not determined by money, race or gender, rather it is created, developed and determined within oneself,” she added.

Property / Financing Page 12

BOIDUS FOCUS Tuesday 01 May, 2012

FINANCE CORNER

REAL ESTATE FOCUS

Savings Versus Investments Commercial Land Allocation In Secondary Areas, Is It Helping Botswana?

by Othata. A. O. Batsetswe BA Economics & Population Studies, Master of Finance & Control Post Graduate Certificate in Risk Management (EXP), Project Management.

[The author writes in his personal capacity]

'The desire to invest requires patience, sacrifice and a strong desire to forgo current consumption for future...'

SAVINGS Most employed persons have at least two accounts.

The first account is the cheque/current account; this is also commonly known as the transactional account. If you are employed, your salary is paid into this account.

As it is the case with human nature to attain sustainability over time, we then open what is commonly known as a savings account. A savings account is defined as a deposit account held at a bank or other financial institution that provides principal security and a modest interest rate. Depending on the specific type of savings account, the account holder may not be able to write cheques from the account (without incurring extra fees or expenses) and the account is likely to have a limited number of free transfers/transactions. Savings account funds are considered one of the most liquid investments outside of demand accounts and cash. In contrast to savings accounts, checking accounts allow you to write cheques and use electronic debit to access your funds inside the account. Savings accounts are generally for money that you don't intend to use for daily expenses.

Despite the ease of accessibility, savings accounts almost always pay lower interest rates than Treasury bills and certificates of deposit; they should not be used for long-term holding periods. Their main advantages are liquidity and superior rates compared to checking accounts.

Savings keep your money safe.

INVESTMENT An asset or item that is purchased with the hope that it will generate income or appreciate in the future. In an economic sense, an investment is the purchase of goods that are not consumed today but are used in the future to create wealth. In finance, an investment is a monetary asset purchased with the idea that the asset will provide income in the future or appreciate and be sold at a higher price.

In the financial sense, investments include the purchase of bonds, stocks or real estate property. Even stocks and bonds have to be of high value. Bonds are always adorable because most bonds issued are government and therefore the chances of a default by government are very slim. There is no use buying stock for a company that makes paraffin lamps when people have moved to Light Emitting Diodes (LED) torches which are now fitted to most cell phones and are highly affordable, convenient and energy saving. For you to buy stock, you need to be diligent on what the market trends are and keen to learn about the world of finance and banking.

The desire to invest requires patience, sacrifice and a strong desire to forgo current consumption for future.

An investment product should be able to offer high return in the future. Investment, as with savings earns interest, however for investment purposes the dividends earned are usually at a high rate. For example, with a savings account, when you save P1000, in a year you are most likely to get a return of P4 (four pula) at an interest

by Maje Maje / Contact: maje@majemaje.com

with investors to be able to develop their properties. The biggest challenge with these plot sizes is that they don’t encourage that at all. Investors look at certain returns on Investment and a certain type of project to undertake.

Investors hardly deal in small developments and will not be encouraged to invest with multiple land owners, making his project complex in the process.

rate of 5% but with an investment you are more likely to get a return of P120 at a growth of 12%, the return could be high or less depending on the market, but in most instances especially the trend with local market, growth is mostly positive.

But then, where are the investments avenues? How come Batswana are only seeing savings accounts from the different banks? Where can one access investments opportunities? Of recent the Botswana stock exchange has been conducting training workshops across the country, these workshops are meant to encourage Batswana to invest in stocks offered by the different companies including some of the local banks where you keep your savings account, the good thing about buying stock as investment is the concept of ownership. Stock is type of security that signifies ownership in a corporation and represents a claim on part of the corporation's assets and earnings. In simple terms you will be an owner of that company to a certain extent.

There are also other avenues for one to invest in, like the purchase of savings certificates from Botswana Savings Bank. The author concludes that the savings certificates are investment because they have an attractive rate which is above the current inflation rate. Any product that is available on the market and has a higher rate of return, higher than the given inflation rate can be termed an investment. These certificates can be accessed through Botswana Postal Services and can be afforded by all.

Investment forums are available and Batswana are advised to always hold their investment in financial securities and physical assets. Getting a mortgage is not an investment until you finish paying for it, assuming you live in it. Having someone rent it and pay you a rental higher than your bank premium is a form of investment. Buying a car, especially a new one is not an investment, but buying a good, well serviced second hand car is good initiative but not an investment.

In terms of farming especially animal rearing, when you have 100 herd of cattle, selling fifty, taking the money to buy into bonds or other forms of stock and remaining with fifty is a great investment, it is also good for the environment and capital markets. Your stock of cattle will be reduced to a much more manageable size while at the same time your savings are utilised for development of infrastructure or any other high value earning initiative. This also creates a balance against unforeseen events like drought or the common terror in Botswana, foot and mouth disease.

Let us invest now, not tomorrow but now, if you have P100 under the mattress go and buy some certificates and remember that when you invest you buy and hold.

Time is of the essence, the longer the investment timeframe, the greater the prospect of a gain.

Investment grows your money/security.

Land in Botswana gets allocated through many systems which some have seen their better days for them to be deemed relevant for their initial purpose. The purpose of allocating land is for the allocatee to derive some economic benefit from it, not the other way round. Though there are a couple of land parcels being allocated, we are today going to look specifically at the commercial properties on the secondary markets of the cities which they are allocated in. The cities and towns which come to mind are the likes of Gaborone, Francistown, Lobatse, SelebiPhikwe etc.

I am not sure how the secondary land allocation came about, but if it was to encourage business, then it has seen its glory days. We will however discuss the advantages and disadvantages of this land allocation system.

One of the key advantages of secondary centres is that it encourages local centres which would be easily reached by the population in the area without having to walk or drive long distances.

It also helps in the employment of local labour, hence saving them on accommodation and transportation costs. I am trying to think of more advantages and I am running out of them.

There are quite a number of disadvantages which are associated with these secondary centres. One of the major disadvantages is the land area which gets allocated, this ranges from say 450 sq.m to 1500 sqm or so. Once you have been allocated the land for development, you have to design a project which is in line with planning requirements and other setback requirements.

That is when you determine which project can fit in the plot. These plot sizes have limited scope, which was originally earmarked for bars, bottle-stores, stores etc. Government is encouraging citizens to enter into Joint Ventures

One other position which always comes with these plots is that they have set rules of what should be developed on them, hence limiting the use to that which is on the title deed.

If the plots had no limitations, then there would be a situation where multiple bars, bottle stores, butchers etc are developed in one area. Once these have been done, they make the other plots undevelopable. This puts the landowner under pressure to develop the land which he has no viable use of. Thus leading to a large number of undeveloped plots. Just to show how unattractive this land parcels are, take a look at centres in Block 5 to Block 9 in Gaborone, they are still to be fully developed and have no proper funding. Take a look at the developments in Block 10, where there are large parcels of land reserved for commercial development. These have been fully developed and funded and they draw good partnerships. Also designing buildings on these plots have proved challenging as the plots are usually fully developed to try and get maximum return of Gross Lettable space.

In conclusion, I feel the advantages of this model are far less that the disadvantages and it will be prudent that land allocators start allocating large parcels of land which can in the long run benefit the whole population, but still encouraging local retailing. This will encourage solid projects to be formulated which will attract professionals with key skills to take advantage of this and help develop it. With the current set of events, this will never attract key skill both from finance arrangers, partnership facilitators and investors. I am of the strong opinion that the current system needs to be improved if we are to encourage Batswana to partake in a meaningful property sphere. Right now they will remain technically excluded, but looking as if they are included. The current system gives a fish and doesn’t teach you how to fish.

BOIDUS FOCUS Tuesday 01 May, 2012

Comments Page 13

There are however lessons that can be learnt from the long journey that Engineers have embarked on in formulation of their registration body. Having a registration body that is funded and answerable to the minister, (minister appoints two out of 4 members of ERB) is less than desirable, as was expressed by participants at the consultation meeting. But it gives the still new body much needed support through government subvention. The ERB can latter on decide to forgo government support and be an independent body, with its own funding strategies. The problems currently facing ARC which includes access to funding can be crippling and a hindrance in the due process in formulation of a robust registration and regulating environment. The issue of funding runs to the core of efforts of creating statutory bodies, and the current nation wide consultations that the ERB has embarked on requires resources and for this to be properly achieved funding needs to be put at the centre of registration bodies.

Boidus Team EDITOR H. Killion Mokwete DESIGN Bridget T. MacKean JOURNALISM Esther Amogelang Keeletsang P. Dipheko Mpho Mooka PHOTOGRAPHY Abo Kefitlhile SALES Thabo Sarona Abo Kefitlhile DISTRIBUTION Nako Kabomo GUEST COLUMNISTS Goitsemodimo Manowe Othata A, O. Batsetswe Maje Maje Jan Wareus Larona Kgabo GUEST EDITING Seabo Morobolo

Boidus Botswana: Ricco, you are right and this means if its all about money then we are not taking 'Housing Provision' as a human right as stipulated by the UN Habitat chatter. Its about those who have money to develop.

Affordability of Housing in Botswana Boidus Botswana: Children born in the late 70's and early 80's have long joined the job market and the current economic climate is that one needs a piece of land.

Everybody and everyone wants a piece of land. This scramble for land has led to an excessive demand and to high pricing in pieces of land. How about citizens are we going to see more Batswana managing to own land?

Ricco Oagile Isau: Its high tym our country revist land rights, we are headin to a situation wher our land will be in th foreignrs hands,and it will be too expensiv to take it frm thm Tirelo Mmolai: Policies must be amended ,else Batswana will soon be owning 20% of land ,go maswe kontle kwa.

Cities should be firstly designed for people, not cars

Boidus Botswana: '...Great cities all over the world are firstly designed for people and not cars and that seems to be forgotten in the hard, impenetrable facades at ground level of the majority of new building going up in Gaborone. Buildings can be big, tall and self centred but their ground level facades should always be layered and shaded in a hot country like Botswana.'

From Dr Henri Comrie when sharing his experiences in the designing of Cape Town World Cup Stadium.

Jan Wareus: I certainly agree with that! In fact, there are plenty of cities/towns in EU of about the size of Gaborone that has NO traffic lights as well as NO road signs, today. All dismantled and car users are on their own, competing with cyclists and pedestrians (and, of c with proper public transport) for the street space. But priority is NOT given to cars! And here we are busy giving them priority with enormously expensive constructions that are not functioning. To make it worse, the Dir Roads promise more of the kind! What a waste of money and efforts! Centrally located parking buildngs are now re-designed for uses like housing, offices and commerce. Must we do the same mistakes all over, again?

Johnnie Swartz explores BIUST. Boidus Botswana: The Minister of Infrastructure, Science and Technology Mr. Swartz visited BIUST site in Palapye, however the minister is very disappointed that some companies fail to deliver projects on time. BIUST is two years behind schedule and China Civil Construction officials promised to complete the work by May and the university is expected to have open by August this year.

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Boidus Botswana: Then you think all guys at this ministry were just recently promoted!

History of Francistown in Photos Pat Sautereau: I think it was the first tarred road in Botswana and was probably tarred in the early 1960's. Wish my Dad were still alive to ask. He was such a mine of information about F/town and Botswana in general. He always took a particular interest in roads and railways and would probably be turning in his grave if he saw the current state of Bots Railways!

Boidus Botswana: F/Town has always had a 'Street' feel to it. its nice to see it back then.

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Pat Sautereau: Haskins Steet, then known as 1st Street and runs parallel to the railway line, was tarred for King George VI 's stop in Francistown on his way to the then Rhodesia on the "White Train" in 1947!! One mile of tarred road was built from the then Games Cafe, past the Grand Hotel to beyond the Tati Hotel. That definitely makes it the first tarred road in Bechuanaland/Botswana.

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Odirile Letlhatshane: sounds like Hon Minister just discovered that BIUST is two years behind schedule...

I guess he has not realised that Sir Seretse Khama Int Airport is three years behind schedule now. Not forgeting the National Stadium, the Francistown Stadium, The Ramotswa Road, The Lobatse Stadium...ours is no more disappointment that govt projects seem never to get to completion, its actually the norm!

BOIDUS IS • Individuals working together towards a common goal • A social network dedicated to creativity • Interaction between the arts, architecture and design across the creative media • Lifestyle, career, theory, fashion…diversity of subject

The Professional contractor’s environment is currently undergoing transformation across the board, with architects currently working towards formalizing their registration council (Architects Registration Council) and quantity surveyors working to establish theirs. This long overdue process is indeed a major step in the right direction for our built environment.

Ricco Oagile Isau: In botswana everything is abt money,if u dont hv money u cnt own a house,let alone a plot.thts why the government made a law tht if u dont develop yo plot thy take it an giv it to a person wit money. No one cares for anybody.

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On the 13th of April, Mr Liojanga’s Engineers Registration Board convened a consultative meeting to consult Engineers and the public on the processes of establishing their Strategic Plan, towards registration and regulation of Engineers in Botswana. The strategic plan is being undertaken, on behalf of the ERB by CSG Consultants. The well attended consultation engaged the attendees on key issues of the strategic plan involving; Themes and Goals of ERB, Key strategies, governance structures and issues of fund raising of the proposed registration body.

Why is Botswana failing to provide quality housing for its citizens?

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Professional Practice Page 14

BOIDUS FOCUS Tuesday 01 May, 2012

SELF REGULATION AND REAL ESTATE PROFESSION IN BOTSWANA: A PERSPECTIVE [Part 2]

by Donald Kagiso Mengwe / BSc (Hons) Est. Mgt, MREIB, Registered Valuer / Email: mengwedon@yahoo.co.uk Secretary General, Real Estate Institute of Botswana, 2008 – Oct 2011 Registrar, Real Estate Advisory Council, 2005- May 2006 [The author writes in his personal capacity]

than academic or theoretical; its technique could be taught, this being the basis of professional education; it was strongly organized internally; and it was motivated by altruism, the professionals viewing themselves as working for some aspect of the good of society" (Becker 1970, p .88).

DIFFERENCE BETWEEN A PROFESSIONAL ASSOCIATION AND REGULATORY BODY Effective and efficient regulation that is in the public interest requires a proper understanding of the difference between a professional association and regulatory body and their distinct roles.

Professional associations owe allegiance to their membership. Their primacy is advocacy of the economic and professional interest of their membership. In this respect their activities typically entail lobbying for the interests of their members, negotiating preferential fees for the members for various services, conducting research and organizing seminars and workshops.

Regulatory bodies are primarily concerned with serving the public interest and are accountable to government in terms of execution of their mandate as defined by the enabling legislation.

Their main focus is to ensure the right quality of service and guarantee competence and good ethical standards.

The legal authority delegated often includes setting entrance requirements, registration, licensing and certification system, prescribing ethical and professional standards, investigation of complaints and administering disciplinary process.

It is quite evident based on the aforegoing, that professional association and regulating bodies promote and propagate distinct interests in terms of control of affairs of the profession. Thus, quite naturally government requires the

separation of professional association and regulatory body because of potential conflict between public and private interests when a profession makes a decision. In Botswana this dichotomy is evident in the distinct responsibilities of REIB and REAC. However, it is also worth noting, that it is not always the case that professional associations and regulatory bodies are separated. Despite potential conflict of interest, circumstances may dictate that both bodies co-exist as one organization (Balthazard, 2010, pg 4).

PROFESSIONALISM A profession means different things to different people, which obviously may translate to diverse definitions. Dingwall (2008) observes that the dominant view of a profession is the ‘attributes approach’. He further clarifies that “the attributes approach begins from the basic assumption that it is possible to draw a list of fixed criteria for recognizing a profession on which there will be a general consensus” (Dingwall 2008, pg 11). He goes on to mention that these criteria can then be used to distinguish between “professions and ‘other occupations’ in a relatively clear and unproblematic fashion”. Dingwall (2008) at pg 11 further gives the exposition that the ‘origins of this approach was identified

by Becker (1970, pg 87) with a paper by Flexner (1915), which set out six criteria’; “professional activity was basically intellectual, carrying with it great personal responsibility; it was learned, being based on great knowledge and not merely routine; it was practical, rather

tswana against a backdrop of improved economic growth following discovery of the diamonds consolidated on this initiative by embarking on an accelerated training programme in the Science and Technology fields - which situation still obtains. The majority of citizen graduates in Estate Surveying trained in the United Kingdom and the balance mostly attended Universities within the Commonwealth.

It is worth noting that this approach has criticisms and in this respect Dingwall (2008) states the works of Becker (1970), Friedson (1970), Illich (1973). At the same time it is undeniable that although the ‘attributes approach’ has its own critique, it resonates with the common sense notion or parlance, which highlights the important features of profession as ; special knowledge and skill acquired through lengthy education and experience, competence and integrity.

Schultze (2007,pg 48) states that professionalism comprises two indivisible components, viz , a code of ethics and standards of professional practice. Generally, ethical standards denote conduct bearing on morality, honesty whereas professional standards encompass ability, questions of competence and standards of business practice.

The Real Estate Institute of Botswana a voluntary association that promotes the interests of the profession, was established in 1996, in accordance with the Societies Act. It was founded against the backdrop of rampant public displeasure in respect of unscrupulous and fraudulent estate agents as revealed by Report of the Presidential Commission of Inquiry into Land Problems in Mogoditshane and other Peri – Urban Villages . Thereafter, the group lobbied for government intervention to regulate the services provided by its members and in 2003 the group was accorded formal government recognition by the promulgation of the Real Estate Professionals Act. This Act of Parliament also created the Real Estate Advisory Council, which is an autonomous regulatory body for the practice of Estate Surveying and Valuation, accountable to the Minister of Lands and Housing. REIB has a majority representation within REAC by electing five out of the nine members of REAC subject to the blessing of the Minister.

REAL ESTATE PRACTICE IN BOTSWANA Real estate practice in Botswana was established as a formal vocation after independence, with most property surveyors operating within the public service, specifically within Department of Surveys and Lands. Most of the qualified Property Surveyors employed in the public service in the early years of independence were British nationals who served on the basis of development cooperation between the two countries to build administrative and technical capacity. The development cooperation, between the governments of Botswana and United Kingdom(UK) culminated into the Manpower Review of December 1985 that supported localization and training of professional surveyors, with the United Kingdom expressly undertaking to finance training programs for citizen graduates in Land Surveying and Estate Management in the U.K and SADC Countries (Department of Surveys and Lands, Annual Report, 1986). Government of Bo-

Despite considerable strides that have been made in instituting a regulatory regime for the real estate profession, there are debilitating challenges which impact on its efficacy and quality of professional service. The process of registration of real estate practitioners by the Real Estate Advisory Council is rudimentary in contrast to international standards.

To give credence to this point, in South Africa the regulatory regime, viz , South African Council of Property Valuers Profession differentiates between four classes of registration for Valuers, based mainly on experience (Cloete;2009,pg 2009; www.sacpvp.co.za). These four classes are: Candidate (Student) Valuer, Professional Associated Valuer with restrictions, Professional Associated Valuer without restrictions and Professional Valuer . In a nutshell, the crux of this registration system is that : the broader the experience, in terms of purpose and type of properties valued, the higher the class of registration (Cloete,2009, pg 290). A Valuer who has spent his

or her entire professional career focusing on the residential property market would upon registration be restricted to the said market segment. Though the registration system appear more advanced than that applied by REAC, it is important to note that it has limitations.

Cloete (2009) in particular, casts doubt on its quality by mentioning that it does not provide Valuers with enough knowledge to be truly effective professionals.

Further, Cloete (2009) based on literature review, posits that international standards suggest that there should be differentiation also in education and not only in experience , to produce different categories of registration because these classes of registration are needed in view of the requirement for different levels of problem solving skills.

The Real Estate Professionals Act stipulates four categories of registration being ; Estate Agent, Valuer, Property Manager and Auctioneer. An applicant may be registered in more than one category depending on full membership of REIB and academic qualification.

Currently applicants are not subject to oral or written examinations and the administration of the registration process does not register Students and Probationers. This prevailing registration system arguably may hardly inspire public confidence and trust or guarantee the quality desired. In its current form it is prone to accusations of anti-competitive conduct as it limits potential entrants and ‘swamping’ as registered practitioners are grouped into fields of practice, irrespective of their levels of experience and competence. It is certainly advisable to prescribe specialization or restrictions within the different fields of practice by considering practitioners’ competence and experience.

This would mitigate situations where a professional is commissioned to undertake work beyond the remit of his/ her knowledge, skill and competence.

Furthermore, the registration process does not commit property practitioners to take responsibility for their learning by keeping up to date with changes in practice, legislation and other developments which may have influence in their professional work. The system also needs to be improved such that those who have taken sabbatical leave from professional activity may only be re-admitted after being subjected to examinations or some form of peer review. ...To be continued next Boidus Focus Issue [to be released 01 June 2012]...

BOIDUS FOCUS Tuesday 01 May, 2012

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BOIDUS FOCUS Tuesday 01 May, 2012

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