Boidus Focus - Vol 4, Issue 10 [Nov 2014]

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| Volume 4, Issue 10 |NOVEMBER 2014

Real Estate API Summit Lifestylenoted: Project Time 07 The 08 12 AdvantageSpecial Save Money, Save the 20 Extensions – African Time Feature Planet, Design Smart BIDP Versus JBCC

BOIDUS FEATURE >

The Botswana Construction Sector Now

FEATURE INSIDE

BOIDUS EXCLUSIVE >

The Unresolved Issues That Should Be at the Top of the New Ministers’ Agendas

by Killion Mokwete & Kibo Ngowi

Property Crowdfunding Comes To Botswana Realty Africa To Introduce New Real Estate Investment Model to the Country

by Kibo Ngowi Crowdfunding is a simple concept that is challenging traditional financing models and rising in popularity across the world. Through this model a project or company is financially supported by many individuals each contributing only a small percentage of the total funding required to get it off the ground.

Realty Africa is an equity crowdfundMinister N. Molefhi

Ministry of Infrastructure, Science & Technology

Minister P. Maele

Ministry of Lands and Housing (MLH)

ing platform specifically targeting property development projects in Southern Africa and led by entrepreneurs Patrick Chella from Zimbabwe and Erik van Eeten from the Netherlands. Boidus Focus spoke with Chella to gain more insight into the company which will be the first of its kind to become active in Botswana.

CONTINUED ON PAGES 6 & 18

Minister K. Mathambo

Ministry of Finance & Development Planning (MFDP)

How Choppies Decides Where to Open Next

CEO Ramachandran Ottapath Opens Up About the Retail Giant’s Expansion Strategy

Now that the dust has settled on the 2014 General Elections and the Cabinet Ministers have been announced, Botswana can turn its attention back to the pressing issues still to be resolved.

The challenges of the construction industry will fall squarely on the shoulders of the newly appointed Minister

of Infrastructure, Science and Technology (MIST) Mr. Nonofo Molefhi and to tackle these issues effectively he’ll have to get the buy in of several other ministries in addition to his own. Boidus Focus presents a snapshot of the most crucial issues this crop of ministers will have to confront in order to safeguard Botswana’s construction industry.

CONTINUED ON PAGE 04

by Kibo Ngowi In business it’s often said that location is everything and none should understand this better than the company that seems to be around the corner in just about every part of the country.

Choppies has grown to be the largest supermarket chain in Botswana with 71 stores within the country, 28 in South Africa and 14 in Zimbabwe.

As with any recognisable brand its

presence always has an influence on consumer patterns and thus the value of the commercial property in which it is located. Boidus Focus spoke to Choppies CEO Ramachandran Ottappath about the decisive role that real estate trends have played and will continue to play in his company’s expansion plans.

CONTINUED ON PAGE 9

Local News Page 2

BOIDUS FOCUS November 2014

FRANCISTOWN INVESTMENT FORUM TARGETS P365M BUDGET

News Briefs

Compiled by Keeletsang P. Dipheko

Game City construction contract out soon Turnstar has announced that the long awaited expansion of Game City Mall is imminent as the construction contract is in the process of being awarded.

The company revealed this in its consolidated statement of changes in equity for the year ended July 31 2014. The expansion contract that will soon be awarded will cover approximately 800 square metres of Game City. The building plans that have been approved by the authorities comprise of a food court, a fashion avenue, an exhibition area, an entertainment and kids play area and a 3-level parkade.

Francistown Mayor James Kgalajwe

In an effort to reach its goal of positioning Francistown as the lead economic hub in Southern Africa by 2022, the Francistown Investment Forum has signed a Memorandum of Understanding with the Botswana Investment and Trade Centre (BITC).

Francistown Mayor James Kgalajwe has revealed that both local and international companies continue to show interest in investing in the city. Though there is no fixed budget in place, the total budget estimation for the investors who had come forward amounted to P365 million. The mayor stated that the investors details would be kept confidential until the signing of contracts between the investors and Francistown had been done.

Among other projects, the development forum included a festival that would resemble the tradition of the Northern Region and Motorsport Marathon.

Chairperson of the Forum Julius Bolokwe said the Investment Forum seeks to create an enabling environment for economic activity in Francistown to flourish, to push Francistown towards developing its human capital and to ready the city to spearhead Botswana’s economy. By virtue of being the second largest city in Botswana, one would have expected Francistown to have enjoyed years of notable developments but this has not been the case. Insiders have blamed the status quo on poor political leadership and the instability of the political landscape.

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MTC, BIH Promote Young Innovators Botswana Innovation Hub in collaboration with the Ministry of Transport and Communications hosted a knowledge sharing workshop for the 2014 Young Innovators Competition. The competition aims to promote creativity, innovation and entrepreneurship among the youth of Botswana by encouraging them to implement business concepts that are currently not being pursued locally. Financial grants worth P300, 000 will be awarded to the three winning innovations.

Molepolole sewerage system to reach completion in 2020 The Deputy Permanent Secretary for Projects under the Ministry of Minerals, Energy and Water Resource, Thatayaone Dedede, has revealed that the construction of Molepolole Sewerage System, which is expected to commence in January next year, will be complete in 2020. However, the defects notification period will run from January 2019 to July 2020. The project, which will cost almost P25 million, is to provide a wastewater borne sewerage system to the entire village of Molepolole. Molepolole was the largest urban village in the country with a populace of 66,466 during the 2011 census and water consumption was estimated at 133,554m3 per month.

BoFiNet awards its P200m project to 5 contractors

P200M

Botswana Fibre Networks Limited (BoFiNet) has awarded contracts to five different companies for delivering five different routes at a total cost of approximately P200 million. The areas to be covered include the 360km Sekoma-Tsabong route whose optical fibre projects tender was awarded to Dimemsion Data. Meanwhile, the 325km Sehithwa-Mohembo optical fibre project was awarded to Complant Botswana and Mepi Building Construction. Additionally, joint companies, Four Arrows and Echoes Holdings, will carry out the Maun-Ngoma optical fibre project, which covers a distance of 362km. The other projects are the Maun local loops optical fibres project, awarded to MMP Construction and Nowaji Services, as well as the Kasane-Kazungula local loops fibre project, which will be undertaken by Business Online.

Debswana Invites private Developers to House Miners The Orapa, Damtshaa and Letlhakeng Mines (OLDM) Senior Manager for Support Services, Thatayaone Sithole, has revealed that the high demand for housing in Boteti leaves a huge gap for the private sector to step in and take advantage. Presenting during the Botswana Confederation of Commerce Industry and Manpower (BOCCIM) business delegation to OLDM recently, Sithole said the mine is not able to provide enough housing for the large population of workers.

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BOIDUS FOCUS November 2014

Advertising Page 3

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Boidus Feature Page 4

BOIDUS FOCUS November 2014

Botswana Construction Sector Now

by H. Killion Mokwete & Kibo Ngowi

MIST - Minister N. Molefhi

CONTINUED FROM THE FRONT PAGE

1. Construction Industry Regulation Bill The establishment of an Industry Regulatory Authority remains the single most important action that the industry needs. The establishment of a regulatory body for the construction industry has been a long time in the making. As far back as 2008, a report by the University of Botswana, commissioned by BOCCIM, outlined in no uncertain terms that a regulatory body was a critical component in bringing the industry’s challenges under control. The creation of this body appears to be closer to becoming a reality than ever before as BOCCIM in conjunction with professional industry stakeholders have developed a Construction Industry Authority Draft Bill and are currently carrying out consultations with industry stakeholders.

Former Minister of Infrastructure, Science and Technology Johnie Swartz who needs to be commended for his sterling job in taking a lead on this had pledged his support for the Bill and had indicated intentions of presenting it to Parliament within the coming year.

It will be crucial for Molefhi to pick up where Swartz left off and make sure the process doesn’t stall like it has so often done in the past. The bill is a critical component to finally have a legal instrument to address some of the most pertinent industry issues such as: • Consumer protection • Professionals regulation and Ethics • Education standardization and regulation • Industry research and development • Project procurement

Now that the dust has settled on the 2014 General Elections and the Cabinet Ministers have been announced, Botswana can turn its attention back to the pressing issues still to be resolved.

The challenges of the construction industry will fall squarely on the shoulders of the newly appointed Minister of Infrastructure, Science and Technology (MIST) Mr. Nonofo Molefhi and to tackle these issues effectively he’ll have to get the buy in of several other ministries in addition to his own.

These include, his own former Ministry of Trans-

port of Communications (MTC) which will now be headed by Mr. Tshenolo Mabeo; the Ministry of Minerals, Energy and Water Resources (MMEWR) led by Mr. Kitso Mokaila; The Ministry of Lands and Housing (MLH) now headed by Mr. Prince Maele and the Ministry of Finance and Development Planning (MFDP), with Kenneth Matambo remaining at the helm.

Boidus Focus presents a snapshot of the most crucial issues this crop of ministers will have to confront in order to safeguard Botswana’s construction industry.

MFDP - Minister K. MATAMBO 1. New Projects for the 2015/16 Budget In his 2014/15 budget speech, Matambo indicated that there are two limitations to the extent to which the construction sector can contribute to sustained economic growth and employment creation. The sector’s unsustainable reliance on government funding for growth on the one hand, and the boom-bust nature of construction that creates many jobs during project cycles only for those jobs to be reduced once projects are completed, on the other hand.

BOCCIM along with industry professional representatives such as ABCON, TBBA and AAB have frequently urged government to put forward an industry bailout package and warned that the sector may face collapse without this intervention, at least from a local professionals’ perspective.

2. Construction and Infrastructure Projects can help the economy grow

Investing in infrastructure during economic recession has been proven in other economies such as the US to be a good base for creating jobs, boosting spending and therefore helping grow the economy. Countries that that have taken the austerity route such as those in most of Europe have remained sluggish and thus their economies have not recovered quickly enough. Botswana as a developing country still has a lot of infrastructure projects and buildings that need to be constructed so the Minister needs to start investing in new projects.

The bill will also put in place measures to help curb corruption practices and most importantly establish industry pricing standards to avoid the current free for all system.

Minister Molefhi only has to finish what Swartz has started and take the industry to a professional level.

2. Review of Maintenance Projects The past four budget years have been focused on maintenance projects as the industry has been frozen from any funding allocations for new projects and MIST has been at the forefront of advocating for this maintenance based budgeting. It is time to do a review of how successful this has been. An audit needs to done on how many projects have been achieved under this programme and more importantly, how has this helped the industry? Industry stakeholders will need to be part of that audit.

If this maintenance focus is to continue, key questions need to be answered. Is there any policy on maintenance or ambitions beyond just physical upgrades of existing buildings?

Are there any other intended benefits apart from ‘repairing’ buildings, such as perhaps skills base development or the sustainable upgrade of government buildings?

The main challenge that has hampered the maintenance drive thus far has been a lack of oversight on exactly how many and to what extent government buildings need maintenance. Swartz previously indicated that MIST had engaged Deloitte and were also working with BOCCIM to undertake stock taking of state government projects which need maintenance. This process will need to be taken seriously in order for maintenance spending to start being planned in such a way that it has a measurable contribution to the growth or at least survival of the construction industry.

3. Unbundling of Mega Projects The other issue which has long been a bone of contention is that of the unbundling of mega projects for the benefit of the local contractors who do not have the resources to compete for projects whose value runs into the hundreds of millions. “If these mega projects could be unbundled down to a range of P10 million to P15 million you could end up with three projects that would energize the economy of Botswana to put food on almost every table of every household in the country,” BOCCIM President Leta Mosienyane was quoted as saying about the government budget allocation to mega projects. The Minister needs to have a clear strategy on how Mega project will be unbundled. Many key projects still remain out of reach for local contractors who do not have the capacity to undertake big projects.

CONTINUED ON PAGE 17

ROADFREIGHT 8-36 tons Bulk transport (tiper) Contract distribution services Refrigerated trucks Deliveries of sand, gravel & aggregates

Consolidations from Johannesburg Crane trucks Truck and from-end loader hire

Behind kgale quarries/private bag B06 We also have offices in Johannesburg

BOIDUS FOCUS November 2014

PART

1

Consumer Education Page 5

PRACTICAL ADVICE GUIDE

Essay 3

November 2014

BOTSWANA BUILDING SOCIETY SAVINGS AND INVESTMENT PRODUCTS

Saving and investing your hard earned money is very important to the growth of your financial prosperity. BBS has a range of savings and investment products to suit your needs. Depending on the purpose for which you intend to save, any one of the following products discussed will definitely work for you.

Tlamelo Mortgage Savings

This account is ideal for investors who wish to save towards a future mortgage loan. Following minimum investment period of five (5) years sixty (60) months, the depositor may use the savings or part thereof as a down payment towards a mortgage loan whereupon the customer prefers to obtain a mortgage loan through the BBS and interest offered at a preferential rate. The product requires fixed monthly deposits and the minimum being P250.00, with an option to make lump sum deposits. The depositor also has the option of rolling over the investment upon maturity. In the event that one is in need of funds before the investment term collapses, there is an option to apply for a short-term loan of up to 75% of the value of their investment. The minimum short term loan amount is P650.00 payable over sixty (60) months. The Tlamelo Mortgage Savings account offers a variable interest which is currently 4.75% per annum, payable every quarter.

Special Fixed Deposit Account

This newly launched special deposit product is intended for commercial entities and individuals, both Batswana and noncitizens, who are residents in Botswana. By investing in this account, one stands a chance to win P20, 000.00. This promotion will run for the next three years, and a draw will be conducted every twelve months from the date of inception.

A minimum deposit of P1million is required and a fixed rate

Letsibogo Savings Account

The Letsibogo account is an account in which, the higher the balance, the more interest one will earn. The interest is calculated based on daily balance, accrued monthly and payable annually as at 31st March each year. There is no minimum balance required, no bank charges and withdrawals are limited to once every three months. The interest rate is variable and ranges from 0.50% to 3.00% tied according to the prevailing balance.

Fixed Deposit Account

Our Fixed Deposit Account offers you the chance to save amounts ranging from P1, 000.00 to P200, 000.00, with interest rates ranging from 4.15% to 4.55%. The investment periods range from twelve months to sixty months. The decision on the term of investment lies with the investor. BBS acknowledges that the key to successful saving is in making the commitment to save; but in the event that one has financial emergencies, they can acquire a short loan against their investment at a reasonable interest rate.

Ordinary Savings Account

This is the most widely used account, mainly because of its extreme flexibility. You can withdraw and deposit as often as you like provided you make an initial deposit and maintain a minimum balance of P100. Interest is calculated on the daily balance and payable on a quarter yearly basis. This account has an ATM facility. It is used mostly for payroll purposes.

Paid-Up Shares Account

There are two classes of Paid-Up Shares. The Indefinite Period Paid-Up shares and the Fixed Period Paid-Up shares. All Shares provide complete security against capital loss and market fluctuations - they should not be confused with stock

of interest currently offered is at 6.50% per annum, payable at the expiry date of the contract. All depositors have the option to rollover both the principal and the interest upon maturity and are also eligible to re-enter the competition as that will be considered as a new deal. Alternatively, one may withdraw interest only, and reinvest the principal or part thereof upon maturity. Early termination will result in forfeiture of all the accrued interest. If for any reason, one requires access to their funds, the Society can offer a short term loan of up to 75% of the value of investment, which shall be payable within the duration of the contract, which is 12 months. The facility can be closed immediately in the event of death of the depositor and the proceeds may be passed on to a third party who will also have the opportunity to reinvest.

exchange securities or company shares.

Lerako Savings Account

Fixed Period Paid Up Shares

This product was initially intended for pensioners to invest their one third lump sum amount. It was later extended to all other customers including companies and other institutions.

The minimum investment amount is P25, 000.00. Interest rates are variable and currently range from 4.25% to 6.00%. Customers are allowed to make exceptional and or incremental deposits anytime at absolutely no cost. Customers may also apply for a short term loan of up to 75% of their savings.

Special Savings Account

This product requires a minimum balance of P500.00 and interest is calculated on the daily balance, accrued monthly and payable every quarter. It allows for two withdrawals in a month. All withdrawals can only be done over the counter in any of the BBS branches as it does not offer ATM facilities for this product at the moment. Variable interest rates are being offered and currently range from 0.50 to 2.75% and tied according to prevailing balances.

Indefinite Period Paid-Up Shares

Indefinite Period Paid-up Shares are offered to companies, institutions, associations and individuals over the age of sixteen.

They are also readily transferable to a third party upon application. They can be used as collateral security for mortgage loans. They require an initial deposit of P 250 000 00. There is no limit to the number of deposits that an investor can make.

These shares can be redeemed on application at the discretion of the Society, subject to six months’ notice after an initial period of fifteen months. In an emergency, they can be used as security for loans of up to 75% of their value. They attract an interest rate of 8%.

This account requires an initial minimum deposit of P100.00, at an interest rate of 4.15% which is paid bi-annually. The initial investment period is 18 months. The dividend is not tax free.

Subscription Shares

Subscription Shares are particularly recommended as a method of saving for a specific objective through easy monthly subscriptions. One can invest any fixed monthly sum they choose, from P100 upwards, to a maximum of paid-up value not exceeding P1 million per account, excluding dividends. The investment period is from 36 months. Subscription Shares earn handsome dividends completely free of tax.

Dividends are paid in March each year. The nature of the account does not permit one to make partial redemptions.

In an emergency, they can be used as security for loans of up to 75% of their value. They can be redeemed immediately in the event of death of the shareholder. They attract an annual interest of 5%.

In the next instalment, BBS will discuss the processes involved from when a loan application is received until it is approved.

Who May Operate Savings Accounts?

All Savings and Investment Accounts may be operated by any person over the age of 16, clubs, companies, associations, partnerships, deceased estates, trust funds and others who might not be stated.

Requirements

Personal Accounts • Letter of introduction from employer ID/Passports for non citizens.

• Utility bill that bears the customer’s residential address or a copy of the lease agreement or a sketch map.

• Latest payslip (where there is no payslip, the letter of introduction should state the gross, net and annual amount earned or to be earned by the customer).

• Minimum opening deposit.

• Birth certificates where the account is being opened for a minor

Additional documents for non-citizens

• Valid residential permit • Work permit or exemption certificate

Company account • • • • • •

Full copy of memorandum Certificate of incorporation Form 2, 4, 5 Minutes or resolution authorizing sign to the account ID/Passports of all directors Work and resident permits for all foreign directors Statements of the last six months, if it is a new company, one of the directors should submit his own personal statement • Utility Bill Minimum deposit of the preferred account • Share certificate

BBS has qualified Sales Consultants who are ready to assist you. You may reach them at 3971396 or visit any of our branches country wide for assistance.

Boidus Feature Page 6

BOIDUS FOCUS November 2014

Property Crowdfunding Comes To Botswana

by Kibo Ngowi

CONTINUED FROM THE FRONT PAGE

Gardening without a Garden Few things are more frustrating than being a garden lover trapped in a small flat or townhouse. What to do? You can actually grow more than you realize in small areas as long as they get enough light.

There’s something special about harvesting your own homegrown food. Most available spaces can be used as long as you get enough light. In any case, whether you have a little space behind your house, space to hang a window box outside your window, or even a tiny balcony, your urban garden can be a veritable Eden of fresh, healthy, home-grown vegetables, and herbs.

By using trellises, containers, window boxes, hanging baskets or wall fitted pots you can maximize your garden in small areas. Not only will you save valuable space, but growing container plants vertically can turn just about any nook or cranny into a beautiful garden spot.

Even if you have plenty of room, vertical gardens will help keep plants up off the ground. They can also be used to define landscaped areas, by creating interesting focal points and eye-pleasing boundaries. Advantages include: »» »» »» »» »» »» »» »»

Fruits and flowers are easier to pick Cultivating and harvesting is easier.

More plants can be grown with less space.

Can be used as a privacy screen or to cover up unsightly views.

Provides better air circulation, reducing fungal problems.

Allows for more efficient watering.

Yields are generally higher.

Creates a shady spot in the garden.

Crowdfunding is a simple concept that is challenging traditional financing models and rising in popularity across the world. Through this model a project or company is financially supported by many individuals each contributing only a small percentage of the total funding required to get it off the ground. As such, one crowdfunded project can have thousands of backers and the need for physical interaction is eliminated through the use of websites called Crowdfunding Portals (CFPs), through which potential backers can find projects and contribute money.

There are currently four different crowdfunding models gaining traction.

Donation crowdfunding allows people to donate to projects they believe in and want to support. The most popular of the crowdfunding sites – Kickstarter. com, which has raised more than $1 billion for over 60,000 completed projects – is a donation-based crowdfunding site. Reward-based crowdfunding, while also based on donations, includes the exchange of a non-monetary reward for each donor such as a T-shirt, acknowledgement or tickets to an event. Debt crowdfunding, also called peer-to-peer lending or lend-tosave, allows investors to lend money to a company that then repays the investor on a regular basis. It allows businesses and entrepreneurs to borrow money without traditional banks.

The fourth model and the model adopted by an international start-up company that will soon be launched in Botswana is equity crowdfunding.

This model allows investors to buy shares or equity in a company, project or venture and thus become part owners. It allows companies to raise capital by selling small pieces of equity to a large number of investors, who make a return on their investment either by being paid a dividend or by selling their shares at a later date, when the company value has increased.

Trellises for Potted Plants Trellises can be pretty nifty garden accessories. They’re used for supporting and training plants and really help out when growing in smaller areas. By using trellises with pots, you can extend small growing spaces. Many potted plants can be transformed from cascading creepers into “the-sky’s-the-limit” climbers when you give them a garden trellis to latch on to. Just make sure that it is firmly attached to your container and that the trellis is in proportion to the pot you are using.

Visit us: Gaborone Dam site Machell Drive www.sanitas.co.bw Call us: +267 393 1358

Realty Africa is an equity crowdfunding platform specifically targeting property development projects in Southern Africa. It is led by entrepreneurs Patrick Chella from Zimbabwe and Erik van Eeten from the Netherlands. Boidus Focus spoke with Chella to gain more insight into the company which will be the first of its kind to become active in Botswana.

BF: Why did you choose Botswana as one of the first countries in which to launch your company?

PC: Botswana offers a great environment with good fundamentals of governance, stability, economic growth and no exchange controls. Botswana is not always on the global investor or property developers’ radar and we intend to put it there. Botswana also sits in a region that is a hub of Africa politically, industrially and in terms of tourism. Now, Realty Africa seeks to provide the global investor with growth opportunities here and also to help developers raise capital for promising projects through our platform.

BF: Have you identified and/or

initiated any projects of particular interest in the country?

PC:

There is one particular project that is of great interest to us right now.

It involves subdividing and densifying a large farm in Gaborone North.

The business case is very strong and there is high demand for residential property in Gaborone as I am sure you already know. The developer of this project is eager for Realty Africa to launch and we envision it being one

of our first projects in Botswana. There are of course perhaps 100 other farms in Gaborone North which will eventually become residential land. Realty Africa will provide a platform where local developers or landowners can raise funding. This is a viable alternative to pension funds, banks and DFI’s (development finance institutions) who hitherto have monopolised debt funding for large-scale property development.

BF: Are you at all concerned that

Botswana and regional residents will be slow to adopt this new business model?

PC: That is a concern. However when

they see that the platform works and that it is robust, open and transparent, it will grow fast. Anything new takes times to become embedded especially when it is a completely new way investing and raising funds.

BF: How soon after the launch do you plan to open the platform for investments into projects within Botswana?

PC: Realty Africa is dependent on the

regulatory process within Botswana as well as our developers in the country obtaining the necessary permits to begin construction. I understand it is common to experience delays in this area. Once all necessities are satisfied we will have an international third party conduct a due diligence on the

property developer and project to ensure that investors know that the projects are of a high standard and bankable. When this process is completed, then the project comes onto the platform and is ready for investment.

BF: Why should local investors and developers take the risk of trying to adopt the crowdfunding model?

PC: Having been tried and tested in

the US and in parts of the EU, the concept of property crowdfunding arrives in Africa. In the US where the idea first gained traction, the industry has quickly become a 5 billion dollar industry in a short space of time. It is even being cited by US government officials as a way of propping up the economy.

The concept is known as crowdfunding, and as the name entails, funds are sourced from a wide variety of individuals and corporates alike. A sort of level playing field is created in the investment arena. This is a big deal from an investment perspective because the days of a limited few getting

access to high yielding investment opportunities are going to be opened up to the participating general public together with institutions. Similarly companies such as Kickstarter and Indiegogo have been doing tremendously well with this regard, spawning several start-ups in South Africa that offer crowdfunding on the arts, film and charity side.

“

Together they have come up with a way of injecting much needed capital into the continent by offering a way that brings together investors and property developers onto their platform.

“

Just to reiterate, the assistance of an internationally recognized third party is used to perform a due diligence on the investment. Developers are checked locally to mitigate the risk of offerings on the platform due to previous unscrupulous individuals that may have tarnished new ideas. Together with the use of escrow accounts to control cash flows, all possible precautions are taken to calm the foreign negative perceptions of doing business in Africa.

BOIDUS FOCUS November2014

Guest Columnist Page 7

THE REAL ESTATE ADVANTAGE-

AFRICAN TIME There has been a lot of discussion about how it is now ‘Africa’s Time to shine in real estate’ but with estimated double digit returns in excess of 20%, one is compelled to wonder if Botswana is On Time.

The theme Africa’s Time carries with it the expectation that now is the time for all to invest in Africa for high sustainable returns. The characteristics of the Africa which delivers these returns seem to carry the same tune: This Africa has high population growth rates; the top 10 cities with the highest growth rate between 2010 and 2050 are as follows:

all the infrastructure itself is not a colonial legacy and as it grows it is directly related to the ability of the economy to build itself. Then we go to the typical economic comparable; we do not fare well in terms of fast growing populations; our GDP is quite stable and well accounted for (with a few areas which I personally think can add a little boost but will never place us anywhere near Nigeria). We do have a young population, and I blame the rate of an increasing middle income population on our parents who didn’t have at least 10 children each to empower us to catch up with other young population numbers.

However we do have some very important things. We are doing well in terms of transparency; Botswana was position 30 in the 2013 Corruption Perception Index (Transparency International 2013), and number 1 in Africa, which speaks to its perceived security of investments.

We are leading the way in terms of land ownership legislation; inflation is controlled, and interest rates are cheap in African terms, though globally still high. Our financial sector is developed and in terms of real estate we have some well-developed structures that most other African countries do not. As is the case with anything though, you win some you lose some; I believe Botswana has a lot more to win in this African Time than we care to leverage from.

With developed legislation why are we not the country that other African countries visit to benchmark? How are we selling our country?

If no one else is creating funds from Botswana why are we not doing it ourselves? We have the education, expertise and experience so

should we not start using OUR RESOURCES to build our land.

We are looking for infrastructure to reduce affordable housing costs; why do we not have an infrastructure fund that provides that underlying infrastructure? Will our banks not fund it? Do we not have the legislature to support the systems?

If the private sector and government could come together and leverage on local capabilities to develop structures that work for our environment instead of adopting structures from countries that have problems different from our own, we can make a way forward.

In the context of most ‘Time for Africa to Shine’ literature we do not fit into the box, but why must we? After all, we are Africa’s diamond so when Africa shines we must, like the diamond, outshine the rest. ©vantage properties info@vantagepropertiesbw.com

• Ouagadougou – Burkina Faso 126%

• Niamey – Niger 100.9% • Kampala – Uganda 100.7% • Dar es Salaam – Tanzania 85.2%

• Mombasa - Kenya 79.0%

• Mbuji-Mayi – DRC 78.6% • Nairobi – Kenya 77.3%

• Conakry – Guinea 75.8%

We manufacture, supply, and fit to meet your demands on all types of Joinery and Aluminium products.

• Bamako – Mali 74.9%

Our high tech computerized machines enables us to manufacture locally

(UN HABITAT: 2010)

Specialists in:

• Mogadishu - Somalia 72.5%

Meanwhile, Botswana’s total population is estimated to grow by around 2% every 10 years.

(Central Statistics Botswana: 2011) This Africa also has high GDP levels; Nigeria’s GDP in 2013 stood at USD 521.8 Billion, with Ethiopia at 46.78 Billion and Uganda at 21.48 Billion.

In some cases the GDP is grossly understated because the large informal sector was not included (Nigeria recently rebased their GDP). Other characteristics include a young population with an increasing middle income population, low transparency levels, high corruption levels, poor land ownership legislation, if any, and a generally underdeveloped formal financial sector, if I may say

Hand crafted wooden doors and panels

[moulding machine, cutting machine, wrap oven, drilling machine]

• prefabricated housing, office, classroom & tuck shop • dry-wall partition • aluminium products • wooden products • hardware store • shop-fittings • garage doors

Fireplaces, Kitchen cabinetry

Wardrobes, Kitchen cabinetry

so without offending the sector itself.

Many of these African countries that are viewed as the golden geese of the century have a very high cost of financing and the banks are as one would expect when the security legislature is not strong – quite conservative.

So how does one extract value from this Africa where the funding within the localities is costly, the land prices themselves depend on the direction of the wind at that particular second and the ownership is as secured as, well, as a black sock in a bedroom shared by 5 boys on a school morning, “he who finds it owns it”?

Botswana on the other hand has quite a different persona to these African countries. First of

Prefab cabins built on site, Counters, Aluminium (I.H.S. Molepolole)

APPRECIATIONS FROM TWINCO ENTERPRISES

BHC, Lobatse Geography Bureau, Lobatse Mental Hospital, Lobatse Sports Stadium, SSKIA, F/town Airport, University of Botswana, I.H.S. Molepolole, Mogoditshane BDF, Glenn Valley BDF, Rakhuna BDF Camp, Gumare Primary School, Lobatse/Kanye City Council, Ministry of Trade, Kasane Muwana Lodge & many other clients.

MAIN BRANCH (Gaborone)

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Boidus Special Feature Page 8

BOIDUS FOCUS November 2014

API Summit 2014

The African Landscape: Providing a solid base for real estate growth

THE MALL OF AFRICA

by Boidus Admin [www.atterbury.co.za]

A myriad of property investment opportunities exist in the emerging African narrative. The African continent has witnessed alarming growth rates and almost all regions offer property yields way in excess of those in the developed world.

Sub-Saharan Africa is expected to grow at 5.2% in 2014 and strengthen to 5.4% in both 2015 and 2016; the region will remain one of the fastest growing in the world (World Economic Outlook 2014).

There are over 1 billion people on the continent, with 90% living in Sub-Saharan Africa at a median age of 18,4. The trend of urbanisation and income growth is fuelling a massive boom in property investment opportunities for all industry players.

As Sub-Saharan Africa’s growth story unfolds, real estate investment opportunities are becoming progressively more fruitful for investors willing to engage in an Africa growth strategy. Real estate projects are increasingly contributing to the continents GDP as commercial property remains in demand.

Developers are quickly responding to rapid market dynamics which indicate a strong demand for modern retail fo mats, greater volumes of affordable housing, and high quality office space built to international standards. Real estate investments are still in its infancy and for investors who take advantage of the numerous opportunities , the yields far exceed the risks involved.

Positive prospects exist for real estate companies across all areas of expertise. Discussion topics during the 2014 Africa Property Investment Summit focused on ways to grow your business model into the African continent.

Recent discoveries of natural resources

FDi amount increased by 13% in 2013 2nd most attractive investment destination in the world

SSa africa projected to increase gDP by 5.2% 2014

Fastest urbanisation rates in the world

gdP projected increase of 5.2% african investors nearly tripled their share of FDi projects in the last decade, from 8.0% in 2003 to 22.8% in 2013 Resource rich

60%

OIl of the world’s unexploited gAS arable land mIneRAlS

The design inspiration for the mall is drawn from the natural and geological beauty of the African continent. This will be expressed in a non-stylised contemporary way• to the exterior and interior. The selected fnishes and materials are intended to provide longevity and a timeless elegance to the design.

Besides the magnitude of the Mall of Africa, the shopping centre design will accentuate the urban planning framework. The design will provide a special focus to the exterior aesthetic that will give the parkades, entrances and nationals with their own unique identity. The mall specifcally addresses a pedestrian friendly environment around the perimeter with a special extroverted friendly approach on the two main planning axial lines, as well as immaculately landscaped areas to the town square and a central park.

The design of the centre includes speciality, national and international retailers as well as upscale restaurants and a distinctive food offering. The mall is planned to be a destination for locals and tourists alike.

The design will create a commercial synergy in the context of its environment, with the goal to create a development that performs as well as excites, to energise the spirit of the shopper and to compliment its surroundings.

222,767bn in construction projects underway

image: Pondoks in Spitzkoppe area

China is its largest trading partner

Summit has set as an unrivalled nity to network with investors and related onals in Africa.”

The Mall of Africa is envisaged as a unique retail experience that will form the key development in what is to become the most sought after urban framework to the northern region of the central Gauteng area, known as Waterfall City. The shopping centre is to be situated at the heart of Waterfall City and will offer approximately 120 000 m² of retail leasable area which will make the mall the largest to be constructed in the country in a single phase. The development will act as the central hub for a range of future mixed uses including retail, offIces, conference and recreational amenities, residential and town centre parking.

South africa is most mature property market

Population expected to increase to 2 billion

in 2050.

Sources: Deloitte african Construction Trends Report 2013, World Economic Outlook 2014, EY africa attractiveness Survey 2014, knight Frank africa Report 2013, kPMg invest in africa Report 2013.

tte Consultancy (Pty) Ltd

“Africa’s economic growth and emerging consumer markets should continue to attract rising numbers of investors to the continent” Knight Frank, Africa Property Report 2014

10

“The API Summit has set the tone as an unrivalled opportunity to network with property investors and related professionals in Africa.” www.apisummit.co.za

info@apisummit.co.za

+27 11 250 2260

Michael Heyink – Deloitte Consultancy (Pty) Ltd 2013 Africa Property Investment Summit Plenary Session

The Africa Property Investment Summit is the most premier real estate conference for any serious property professional in Africa’ V.Gikonyo Gitonga – AXIS Real Estate Ltd

2013 API Summit Cocktail Function

2013 Africa Property Investment Summit Plenary Session

The Africa Property

CONTINUED ON PAGE 21

BOIDUS FOCUS November 2014

Boidus Feature Page 9

How Choppies Decides Where to Open Next

by Kibo Ngowi

CONTINUED FROM THE FRONT PAGE

BF:

There have been concerns voiced by many that Gaborone is being overrun by shopping malls. Within the last few years we have seen the establishment of several major shopping malls and many are not convinced that the spending power of this market is enough to sustain all of them. What is your take on this?

RO:

Wholesale is around 45 percent of to-

tal trade in Botswana. In a matured economy wholesale should range between 20 to 25 percent maximum so there is still going to be a great shift from wholesale to retail. That’s why none of the shops in these smalls are doing very badly.

They are surviving. This trend of shifting from the wholesale category to the retail category will also help them to survive and it’s not going to be doomsday for the malls. But I think going forward

Gaborone is coming closer to a position where one or two malls can fill the gaps but if an influx of malls comes in, say five or six in a year, then it will be a problem. One new mall a year is sustainable. There is still a lot of trade to be formalised.

There is going to be a time when this country cannot take any more malls but I think we are far from that. Yes there is a serious concern of population because it stands at only two million people and the spending power is also getting cut day by day but for now there isn’t any impending danger.

In business it’s often said that location is everything and none should understand this better than the company that seems to be around the corner in just about every part of the country. Choppies has grown to be the largest supermarket chain in Botswana with 71 stores within the country, 28 in South Africa and 14 in Zimbabwe. As with any recognisable brand its presence always has an influence on consumer patterns and thus the value of the commercial property in which it is located.

Boidus Focus spoke to Choppies CEO Ramachandran Ottappath about the decisive role that real estate trends have played and will continue to play in his company’s expansion plans.

BF:

You were a speaker at the African Property Investment (API) Summit in 2013 and you were scheduled to speak at this year’s edition of the event as well, although you had to cancel at the last minute. Why do you feel it is important to participate in the API Summit?

RO: We find it very important to attend and participate in forums such as the African Property Investment Summit because for a company like Choppies that has aspirations of Pan-African expansion, a platform to interact with the real estate developers and the industry as a whole; it allows us to get to know the dynamics of the in-

dustry going forward. I was a presenter last year but I couldn’t attend this year because it clashed with another presentation in the United States.

BF: What is the strategy that informs the decisions regarding where to open new Choppies outlets?

RO:

We look at the demographics in terms of population and the economic activity associated with it. In Botswana we look at around 10,000 people in the area to establish a Choppies outlet while in South Africa it is 20,000 people but we have opened outlets in areas with less people than that in cases where there are economic activities such as the presence of a mine or of industry.

BF:

There are some cases in which several Choppies outlets are located in close proximity of each other. What is the thinking behind this approach?

RO:

That’s something that you can only see in Gaborone because this city is the Capital and almost 55% of the economic activity in the country is taking place here so it follows that the same proportion of our outlets in the country will be located here.

We charted out a growth plan for South Africa.

We’ve got a distribution centre in Rustenburg.

We take a 500km radius from that distribution centre but we exclude the metros of Johannesburg and Pretoria; then we analyze the area and see where the opportunities to make better returns are located. We have one distribution centre each in Gaborone, Lobatse, Francistown, Rustenberg and Bulawayo.

Maranyane House Plot 50654, Machel Drive Private Bag 00265 Gaborone, Botswana

Tel: +267 391 3328 Fax: +267 391 3289 Email: info@bih.co.bw www.bih.co.bw

Advertising Page 10

BOIDUS FOCUS November 2014

BOIDUS FOCUS November 2014

Home Improvement Page 11

DIY Projects - Green Roofing Solutions & Repairs 4 Green Roofing Options to Put Those Asphalt Shingles to Shame

How to Fix a Leak on a Clay Tile Roof

by Sandra Karnes / Source: www.doityourself.com

We have all incorporated in some way green lighting, green cleaning or green energy in our homes, so why not green roofs?

There are a couple reasons why a roof can be considered green, or environmentally friendly. A roof made of recycled materials-like plastic, wood, metal or rubber--is one reason. A roof can also be considered green if it can be recycled again at the end of its life span. The longer a roof lasts, the better for the environment.

Recycled Shingle

One of the greenest roofing materials is shingles made from post-consumer or post-industrial waste. The reason they are considered so environmentally friendly is because they consist of redirected waste from a landfill and because there is no need to extract raw materials to make them. The best part is that some come with a 50-year warranty and can also be recycled again at the end of their life.

Slate and Clay Roofs

A good reason to roof with slate and clay is that they are a natural and durable material that can last hundreds of years. Typically these two types of materials can’t be recycled to their original condition, but they can be salvaged and used in other ways after their life span expires.

Slate and clay are very heavy and the structure of a building must be inspected before considering these options. Clay shingles are also best if used in warm climates because freezing and thawing in cold climates will damage clay easily. Slate and clay also have

reflective properties that help keep a home cool.

Rubber Roofing

Believe it or not, rubber roofing is made from recycled steel belted radial tires from cars. Typically, there is a 50-year warranty on them which usually includes hail damage. Rubber roofs come in a variety of colors and are coated with ground slate to add texture. Before considering this option, you should check building codes in your area because rubber roofs are not permitted in some communities.

Metal Roofing

Metal roofing has many great qualities, one being that it can be recycled again and again and again. But to see that happen, you would have to live forever as a metal roof can last 50 years or more. Metal roofs are also durable and fire resistant. Metal roofs also reflect heat from the sun, which reduces cooling costs of your house.

Metal roofs are great for cold climates because accumulating snow will slide right off of roofs. If you have ever lived in a cold climate you know how destructive ice dams can be, but with metal roofing there is no such thing as an ice dam.

In the summer you can collect rain water that slides off your roof and not have to worry about any residual chemicals leeching from the roofing material. This is just another environmental perk of a metal roof -- you can use the recycled water for your garden or to wash your car.

Sponsored by Sponsored by

Source: www.doityourself.com

A clay roof tile is often susceptible to leaks caused as a result of various problems in the tile or in the method of installation. The manner in which a leak can be repaired will differ depending on the cause of the problem.

Tools and Materials

Keep in mind that the tools and materials that you need will depend on the cause of the leak.

• Mortar • Waterproof membrane • Caulk gun • RT-600 Tile Roof Sealer (terracotta color) • Hammer • Pry bar • Hanger strap • Wet saw • Nails

Step 1 – Identify the Cause

Clay roof tiles may leak due to several faults.

While some problems that go beyond the roof and are related to the other aspects of the roofing or installation methods, some of the common problems regarding clay tiles are: 1. Defective or worn out waterproof membrane 2. Collection of debris in the roof valley 3. Cracked tiles 4. Broken tiles

To fix the leak, you will need to fix the specific problem that applies to you. Keep in mind that clay roof tiles break easily under pressure, so be very careful when walking on your roof to determine the cause of the leak.

Step 2 – Fixing a Membrane

If the problem is in the waterproof membrane, you will need to remove all your existing tiles and replace the old membrane with a new one.

Then, re-tile your roof. You may need the help of a professional for removal and re-tiling.

Step 3 – Removing the Debris

The roof valleys, especially the closed ones, collect a lot of debris. More often than not, this can cause leaks in clay roof tiles. In order to remove the debris such that there is no more leakage, you will need to remove the tiles from the valley, clean out the area, and then reinstall the tile.

Consider converting the roof valleys into open ones to avoid debris collection in the future.

Step 4 – Fixing a Crack

If you find that there are fine cracks in your tiles, you can repair the crack by applying RT-600 on the tile using a caulk gun. Allow the sealer to spread over the entire tile, and let it dry.

Step 5 – Fixing Broken Tiles

Tiles that are broken or have large cracks need to be replaced in order to fix the leak. For this, you will need to remove all damaged tiles using the pry bar. Use a hammer to assist in the removal, but be careful not to damage good tiles. If your roof is old, chances are that your tiles have been fixed using mortar. In this case, place the new tiles and use the mortar to seal them in place.

Newer roofs will have nails that hold the tiles in place. If this is the case, you will need a hanger strap. Place your new tile on the hanger strap, and hang it where the new tile needs to be fitted. Make sure that you do not force the tile in place. Use a wet saw to cut the edges, if needed.

Next, simply hammer the nails into the top tiles, securing the new tile to the roof. Now, apply mortar or RT-600 to the sides to ensure a complete seal.

BOIDUS FOCUS November 2014

Guest Columnist Page 12

Lifestylenoted: SAVE MONEY, SAVE THE PLANET, DESIGN SMART

by Tshepiso Motlogelwa, Interior Designer - tsmotlogelwa@gmail.com There are three easy ways to cut down your waste that can make a big difference to the amount that ends up in landfill. These are known as the 'Three Rs'—reduce, re-use and recycle. Over the festive season we eat, drink, party and buy more than any other time of the year, but it’s also when we consume more and generate more waste, which is tough on the environment. These days about half of what we throw into our rubbish bins is organic material that could otherwise be recovered for compost. With Botswana’s landfills rapidly reach-

Unfinished raw pallet with caster wheels will add a new dimension to your lounge.

ing capacity, composting is an ideal way for you to reduce the amount of waste going to landfill and enrich your garden all at the same time.

By thinking about what you really need and refusing what you don't, giving items more than one life and disposing of rubbish thoughtfully, you can reduce waste and save money.

Pallets are a great way of re-using wood as loads of businesses get shipments that are packed

on wooden pallets. If you are driving around, or know of any nearby building supply or liquor stores, take a peek around the back to see if you can spot any pallets. Ask nicely if you can take them; most warehouses are happy to give them away. Before using pallets, ensure that you clean them thoroughly because most of them, especially those used for food packaging, can harbor a lot of bacteria.

Lets look at some great DIY summer projects that will be fun to do and give new life to your space without breaking the bank, an important quality considering all the crazy Christmas spending that will be going on soon, no matter how much we may try to avoid it.

These are also quite easy to do and you can get all the kids who have come over for the holidays to help.

CHICAGO DESIGNERS SAY OFFICES FEEL INCREASINGLY lIKE HOME 4 NOV 2014 (INTERIOR DESIGN MAGAZINE) At a recent roundtable discussion of about 30 Chicago designers and architects, the talk turned not to fees or millennials but to office culture and live-work balance. The lively group spent most of its time discussing how office design was being driven by the merging of life-work time, with the two increasingly having little to no separation in today’s daily life.

As Jim Prendergast, design director at Gensler in Chicago, said to the nods and laughter of others in the room, “It’s no longer work and life. It’s become one thing. Life is just life.”

Invited by Interior Design to participate at the discussion, which was held at Soho House Chicago during the magazine's One Night Only Chicago networking event, the designers and architects also spent time talking about how workspace is becoming more authentic and real. “We are spending an increased amount of time finding out what makes a company distinctive. We have to discover what is the culture and the values,’’ said one designer, who talked about the space needing to reflect a company’s culture in an authentic way.

To change up the look of a traditional kids room and teach sustainability early on, why not incorporate a wood pallet bed.

“I get super worried about these clients who say they want their space to be ‘cool’, but it doesn’t fit with the company, “ continued the designer. “It’s just not authentic.”

I love how simply adding a glass top and caster wheels gives the coffee table a whole new look. The raw pallet can be stained any colour stain you want after treating it.

Raw pallet looks lovely, but a painted pallet which serves as the base of this ottoman is awesome. You can get advise from your local hardware store on the right kind of paint to use on a pallet.

Organize your office desk with this simple project made from recycled toilet paper rolls.

This bench made out of stacked up pallets and finished off with a foam mattress and a few cushions will save you thousands on a new couch.

Great as a centre piece!

The client’s words may not match the reality of the company, agreed another designer.

“When they [executives] say the company has an 'open-door' policy, how true is that?” asked one designer. “We can come up with design solutions, but the culture the client describes has to be embraced by everyone at that company to make it successful.”

As home life and office life increasingly merge, the office is also becoming more like a home, with amenities and a feel-good atmosphere that is a must to attract top talent.

“It seems they are looking at the environment more than they are looking at the salary or benefits plan,” said one designer of new hires who ask more about the firm’s space and amenities than about the firm itself. Added another designer: “These aren’t amenities anymore… these are expected. The question is what more can we give them?”

It’s not just the lifestyle amenities that are part of attracting top talent. Everyone from young to old, the group agreed, is looking for cutting edge technology. EMPLOYEES are looking at new or advanced technology as the norm. Being able to talk to outside offices, design and comment, send large image files and more—employees expect these and more at anytime without logging in, without having to download a program and within one tap of the screen or keyboard.

Recycling old magazines has never looked this great! The leaves of this tree are cut from old magazines. Get a canvas board from any art supplies shop and get creative!

If you love reading like me, you will probably have hundreds of old magazines and newspapers that have now become more of clutter than useful information sources. You can find a use for them by turning them into these super cool ottomans.

Yet, not everyone can be cutting edge with technology or design. Most of the group agreed that their JOB also included being what one called "Truth Consultants," getting clients to see the reality of budget, space restrictions or even a corporate culture that may not embrace or benefit from a huge change.

BOIDUS FOCUS November 2014

Guest Columnist Page 13

Lifestylenoted: A REFRESHING TAKE ON URBAN HOSPITALITY – INSIDE REGENT SELECT HOTEL

by Tshepiso Motlogelwa, Interior Designer

Regent select reception

According to a popular saying, 'first impression is the last impression'. This has been proved a number of times and applied to anything and everything under the sun. In the hotel industry, it is all about creating an impressive first impression. The newly opened luxury and up scale Regent Select Hotel doesn’t fall short of making a good first impression with its refreshingly different hospitality experience; from the warm, earthy and textured exterior wall finish fused beautifully with the green, lush and well manicured garden to the warm welcome smile from a friendly receptionist who almost makes you feel like you are the most important person to ever walk through their doors! Eco and green efficiency played a major role in turning this picturesque 30 executive room hotel into a functional reality. It features a contemporary hotelin-a-garden concept that focuses on integrating environmental principles and elements of nature throughout the property. Upon entering the reception, you are immediately made aware of just how much the designers strived to interpret the owner’s vision of creating a warm yet earthy atmosphere with a contemporary feel blended with ethnic elements.

Officially opened on the 19th of August 2014, Regent Select Hotel is already making its presence felt as a luxury and executive hotel that takes the needs of its customers very seriously. Nothing can be more refreshing than having a hotel manager help you with your luggage bags or buff your shoes! The hotel General Manager Jimmy Borchard does just that with an obvious enthusiasm and passion. Jimmy takes his own words seriously: “If you’ve got the right venue and the right service, a hotel can feel like a home away from home for your customers.”

From rain water harvesting and grey water used to irrigate their garden to bio degradable bathroom products and more, Regent Select has added a fresh new perspective to urban hospitality with a range of innovative sustainability features.

The welcoming comfort of their rooms is accentuated by soft colour hues that create a restful environment that is sure to refresh your mind, body and spirit.

With its modern furnishings, large windows and plenty of natural light, the restaurant is nothing short of elegant, and also features a bar where you can enjoy a lively mix of entertaining conversation and refreshing beverages. The restaurant and other facilities are reserved for hotel guests in order to maintain an intimate, exclusive atmosphere as the venue is targeted to corporate professionals.

Regent Select hotel features 52 parking spaces and 36 Sqm rooms. They have also gone all out to ensure the security of its guests is not compromised in a any way by installing 15 CCTV cameras. Free WI-FI is available to the guests and extends to as far as the pool area. A 20-seater boardroom with an outdoor spill out area makes it ideal for corporate events.

The hotel currently employs local staff and all their food stuff is locally produced. To further support the locals, Regent has commissioned a local designer to do their staff uniforms. The beautiful landscaping was done by the owner who ran the property as a nursery for plants before converting it into a hotel. They will be ready for grading this year and are aiming for five stars but will settle for nothing less than four, said Jimmy.

Boidus Feature Page 14

BOIDUS FOCUS November 2014

Lifestylenoted:

“The Hospitality & Tourism Industry is on the Rise” HATAB CEO

by Boidus Admin The Hospitality and Tourism Association of Botswana (HATAB) is a non-profit umbrella organization representing all sectors of the tourism industry in Botswana whose aim is “to promote, encourage and police excellence in hospitality and tourism in Botswana.” Boidus Focus met with HATAB CEO Lily Rakorong to learn from her perspective of the hospitality industry in Botswana.

BF: What mechanisms does HATAB have in place for regulating hospitality venues operating within the country?

LR:

The tourism industry has a favourable impact on the overall economic status of Botswana; therefore premium care should be taken when ensuring the efficient and effective operation of hospitality venues in the country.

HATAB advocates for service excellence and enforces a code of conduct for its (voluntary) members and promotes the tourism and hospitality industry through consistent, immediate communication with domestic and international tourists.

Furthermore HATAB assists in valuable policy implementation, on behalf of its members to encourage members to provide visitors with an amiable experience during their stay in Botswana.

The people, hotels, restaurants, camps and safari lodges that make up our hospitality venues are aware, through HATAB, that tourism entails projecting a favourable national image to the outside world.

It is commendable though that those members themselves recognise the importance of high standards at every level of the industry. The association makes an effort to keep its members informed by means of publishing a quarterly review and holds an annual general meeting when the chairman reviews the developments of the past year and considers what the future holds. All this is done to keep members informed. We also have our two major events, the HATAB Annual Conference and HATAB Festivity Conference, where members engage with stakeholders to gather and exchange ideas and to deliberate on issues and challenges that impact on the performance and growth of the tourism industry.

HATAB also ensures that hospitality venues thrive and prosper by creating an enabling environment.

BF: Have you recorded any significant rise in the number of hospitality venues operating in the country in the recent past? If so to what do you attribute this trend?

LR: Evidently there has indeed been an increase in the number

of hospitality venues operating in Botswana in the recent past.

The rapid rise is attributed to the fact that Botswana is one of the most visited countries in Africa according to recent statistics. Botswana is stable, peaceful, and secure and manages its resources prudently.

As one of the internationally preferred tourist destinations Botswana has therefore had to put in place opulent hospitality venues so as to host inbound and outbound visitors adequately, efficiently and effectively thus ensuring a pleasurable experience for our visitors.

HATAB supports the significant rise in hospitality venues. It’s a body that is also an important component in the tourism industry of the country. Tourism has contributed immensely to the economy of Botswana and it’s of note that tourism contributed BWP 2.9 billion, being 3.7% of the country’s gross domestic product (2010 department of tourism statistics).

BF: What kind of venues are currently in high demand?

LR: It is apparent Batswana are making an effort to tap into

other tourism sectors and not just the wildlife sector. This has resulted in a demand for various venues in the overall hospitality industry.

Recent observation has shown that the event and conferencing sector is blossoming and therefore facilities have been put into place to keep up with demand. There are more coming up which confirms opportunities within the sector. Entertainment provision facilities are confined in one district, being the southern district; this has resulted in other districts expressing a need for recreational parks and structures such as park resorts in other parts of the country.

Sport tourism has been recently explored through the 2014 Africa youth games. It’s of note that there is a growing number of talented youth and that therefore we need to have in place top notch facilities that offer state of the art technology and sporting instruments to enable us to groom and nurture our youth and get them ready to compete internationally on a professional level.

Medical tourism tends to be ignored and overlooked. The lack of adequate, advanced and innovative medical personnel and facilities has driven out our locals to other countries, mainly South Africa, which offers exemplary and ideal medical treatment and care.

BF: Have you recorded any other significant trends in Botswana’s hospitality industry?

LR:

Consistent with the global trends, tourism in Botswana has been growing substantially. The expansion in tourism suggests it has considerable potential to contribute toward Botswana economic diversification, away from dependence on diamond mining. Botswana has made a commendable effort in positively impacting local perceptions about the importance of tourism and how it affects the development of the local economy.

HATAB seeks to encourage the sector to focus on cultural tourism and in each of the 9 districts within the county. It is noteworthy that there has been a remarkable positive trend, visible with the birth of new cultural events, one of which being the Ngamiland indigenous food and wine festival to be held in Maun on the 28th and 29th of November.

Note that the tourism industry consists of the entertainment tourism, medical tourism, sport/event tourism and meeting incentives and exhibitions (MICE), therefore HATAB urges its members to diversify and exploit all the sectors in the tourism industry.

BOIDUS FOCUS November 2014

Advertising Page 15

Education Page 16

BOIDUS FOCUS November 2014

Thinking about going back to school for your post graduate studies in Architecture? →→ Here a list of Best schools from USA and UK to consider →→ List of Grants and fellowships specifically for architects and designers The Enterprise Rose Architectural Fellowship is a three-year program in which young architects are paired with local organizations to work on housing and community development projects in underserved areas. Offered by Enterprise Community Partners, the fellowship has sponsored 35 architects since its inception in 2000 and comes with an annual stipend of $47,500.

BEST GRADUATE SCHOOLS 2014 UNITED KINGDOM

BEST GRADUATE SCHOOLS 2014 UNITED STATES

[www.theguardian.com] 1. UCL 2. Cardiff 3. Bath 4. Cambridge 5. Newcastle 6. Kent 7. Oxford Brookes 8. Manchester School of Architecture

[www.archdaily.com] 1. Harvard University 2. Yale University 3. Columbia University 4. Massachusetts Institute of Technology 5. Cornell University 6. Rice University

FELLOWSHIPS AND GRANTS FOR ARCHITECTS AND DESIGNERS http://archrecord.construction.com/news/2011/11/Fellowships-and-Grants.asp The Aga Khan Program for Islamic Architecture offers a three- to nine-month postdoctoral fellowship for research in Islamic art and architecture at Harvard University.

The fellowship is directed toward foreign academics and recent graduates of Ph.D. programs; it comes with a stipend up to $27,000, depending on the duration the fellowship.

Architecture for Humanity (AFH) has a rolling design fellowship program that pairs architects with public building projects in the U.S. and abroad. Through the program, fellows have worked on the dilapidated Manhattan Bridge Skatepark, built sporting facilities in South Africa, and designed sustainable architecture in Haiti. AFH keeps a running list of available fellowships.

The Buckminster Fuller Challenge, established in 2008, is an annual $100,000 award that funds a humanitarian and/or ecological project proposed by an individual or organization. The prize is awarded to projects that best exemplify “how small amounts of leverage, energy, and resources” can produce maximum positive change.

The Oregon-based Curry Stone Foundation provides grants to individuals or groups working on projects that facilitate healthy communities. The Curry Stone Design Prize is an annual $100,000 award given to an architect, designer, or organization whose work provides access to clean water, food, education, and/or shelter. The foundation also awards smaller monetary prizes. The program is administered in partnership with Architecture for Humanity and Harvard University.

The Getty Conservation Institute has a scholar-in-residence grant program for professionals with at least five years work experience in conservation. Research grants are awarded for three, six, or nine months and come with a monthly $3,500 stipend.

The Getty Research Institute has a scholar-inresidence fellowship program in Los Angeles for Ph.D. students and postdoctoral students who are interested in conducting pre- or postdoctoral research relating to the Institute’s annual theme. The program runs from September to June, with stipends of $25,000 and $30,000 available to pre- and postdoctoral fellows, respectively. The Institute also offers grants for on-site research relating to Los Angeles’s architectural history and urban development.

The Loeb Fellowship, awarded by the Harvard University Graduate School of Design, offers fellowships for mid-career design professionals, providing them the chance to conduct independent study at one of the university’s schools.

The National Building Museum offers 10-week Field Fellowships to students pursuing a Ph.D. or master’s degree in architecture, historic preservation, or related discipline. Fellowships also are offered to postdoctoral applicants who are less than five years out of their studies. Recipients are awarded a $5,000 stipend.

The National Council of Architectural Registration Boards (NCARB) offers grants up to $75,000 to implement new curricular and academic programming in architecture at U.S. universities. Faculty members of accredited institutions may submit proposals.

The New York Foundation for the Arts (NYFA) Artists’ Fellowship offers annual grants of $7,000 to practicing artists who have lived and worked in the state of New York for at least two years. Each year, the NYFA considers grant applications in select disciplines.

The NIAUSI Fellowship, sponsored by the Northwest Institute and the Civita Institute, allows architects working in British Columbia, Washington, Oregon, and Idaho to study design issues relating to the Pacific Northwest while living for one or two months in Civita di Bagnoregio, Italy. Applicants for the one-month fellowship must have at least two years of professional work experience; for the two-month fellowship, seven years of experience are required. In addition to lodging and airfare, fellows receive a $1,500 stipend. AIA Seattle members with at least seven years of work experience can apply for a one-month fellowship offered jointly by the NIAUSI/AIA Seattle.

The Richard Morris Hunt Fellowship, offered jointly by the American Architectural Foundation and the French Heritage Society, is a six-month exchange program for mid-career architects interested in studying historic preservation abroad. The fellowship is awarded to French and American architects on an alternating basis.

The Rome Prize is annually awarded by the American Academy in Rome to mid-career practitioners and scholars with a demonstrated interest in the arts, architecture, historic preservation, and related fields. Two fellowships are offered: one for a six-month period, with a $13,000 stipend; and one for an 11-month period, with a $26,000 stipend.

The Smithsonian Institute offers four summer fellowships for graduate students, pre- and postdoctoral students, and “senior investigators.” The fellowships span from three to 24 months; stipends vary.

Skidmore, Owings & Merrill offers recent graduates of undergraduate and graduate architecture programs a chance to win a $50,000 award for research and travel.

The jury-led SOM Foundation Award for Architecture, Design, and Urban Design is awarded to one student annually. The Foundation also offers a $20,000 grant to a runner-up. American citizenship is not required.

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BOIDUS FOCUS November 2014

Boidus Feature Page 17

Botswana Construction Sector Now

by H. Killion Mokwete & Kibo Ngowi

CONTINUED FROM PAGE 04

The construction sector has in the past three years been frozen out from Government expenditure through an emphasis on mainte-

nance of existing infrastructure rather than on new projects. This, according to most industry champions, including BOCCIM, has contributed to the slowdown of the industry.

BOCCIM along with industry professional representatives such as ABCON, TBBA and AAB have frequently urged government to put forward an industry bailout package and warned that the sector may face collapse without this intervention, at least from a local professionals’ perspective.

MLH – Minister P. Maele 1. Affordable Housing Must Become A Reality Housing provision in Botswana is a big problem which the previous minister had not developed any discernible solutions to solve. Affordable housing still remains a pipe dream.

Botswana Housing Corporation is still not delivering any housing that is affordable to Botswana. In fact, more than 60% of income earners cannot afford housing in Botswana.

This surely needs to be addressed as matter of agency, especially that the United Nations Article 25 of the Universal Declaration of Human Rights recognizes the right to housing as part of the right to an adequate standard of living. Earlier this year, the MLH held discussions with banking stakeholders and others to explore plans for establishing an Affordable Housing scheme aimed at assisting Batswana across the board to afford housing. Finding a convincing solution to this dilemma needs to be the Minister’s number one priority.

2. The Public Needs to be Educated on the new Powers of the Local Authorities The other issue that the Minister needs to address is the completion and devolution on powers to Local Authority under the revised Town and Country Planning Act 2013. These powers which most Batswana are not aware of due to a lack of thorough public consultation are set to change the landscape of our planning procedures and yet not much is done to educate the public. One small example is the revised development control code which is causing havoc across the country as people grapple with transitioning from a DCC document which was under 50 pages to one which is over 300 pages and is laden with technical terms that ordinary people would not understand. The Minister needs to dedicate resources to making sure that the public has access to these changes and can comprehend them. Some include the new Planning Tribunals, new Building Codes and also new processes in Lodging Applications.

Commercial Property Insurance

by Alan David-Andersen, Risk Management Consultant, BIC

tended to cover such perils as: • Storm and special perils (wind, water, hail, snow and impact as defined), • Earthquake, • Riot strike and malicious damage, • Leakage of firefighting equipment, • Subsidence and landslip.

In addition to the above a Buildings Combined section includes the perils of: • Theft accompanied by forcible and violent entry or exit from such building, • Accidental damage to sanitary ware and water sewage, gas, electricity and telecommunications connections.

Commercial properties are either insured under a Fire or a Buildings Combined section of a policy depending on the buildings use. Traditionally, Buildings Combined policies provide a slightly wider cover than that of a Fire policy but are only intended to cover office blocks, churches, halls, schools and the like.

A Fire policy in its basic form covers fire, lightning, thunderbolt and explosion but may be ex-

A fire policy not only covers the physical building but can be extended to include loss of rental following the operation of a fire peril. Cover ceases when the property is rebuilt and becomes tenantable. With a Buildings Combined section, cover for rent is automatic up to 25% of the property sum insured. As an alternative, loss of rent may be insured under a Business Interruption section were cover is wider in that cover ceases only when a

tenant is found - always subject of cause to an adequate indemnity period of 12, 18 or 24 months.

A fire section unlike a Buildings Combined does not provide any liability cover to protect the property owner from legal liabilities arising out of ownership of the building and following injury, death, accident loss etc. that may occur as a result of their negligence. This cover must be added as a separate section known as Public Liability.

Other covers that may be required in addition to a Fire section include; • accidental breakage of glass in the case of shops for example (covered under a Glass section), • malicious damage following theft resulting in damage to the building which is not covered by the malicious damage peril under the Fire section (covered under a Theft section), • political riot and strike (available from overseas insurers).

The Fire policy like all other asset policies is subject to average/under insurance. The sum

insured must represent the CURRENT replacement value allowing for escalation for the period of insurance. It must also include demolition and debris removal costs, professional fees and VAT. As far as loss of rent is concerned, the sum insured must represent the rent receivable for the indemnity period chosen i.e. 12 months and include any increases in rent during that period.

The indemnity period chosen should be based on the realistic time frame for the structure to be rebuilt following extensive or total loss damage.

In both of the above instances if the sum insured is inadequate, payment will be made on a pro rata basis. Simply put if you are 30% underinsured the claim will be adjusted downward by 30%.

With the rating, the main considerations are the type of construction, the occupation of the tenants, adjacent properties, position (near a river).

Where possible, risk surveys are undertaken to establish the firefighting equipment, housekeeping, security and risk improvements requirements are requested where required.

The above is intended to give a brief overview of commercial property insurance and we recommend that you contact your Broker or Agent for more specific information.

Boidus Feature Page 18

BOIDUS FOCUS November 2014

University of Botswana was Crowdfunded

Crowdfunding Fast Facts

by Boidus Admin

UB's official logo, seen here on the front of the UB Library [left image], and the sculpture of a man walking with a cow directly in front of it, both represent the contribution that the people of Botswana made to build the university

Botswana is actually no stranger to the concept of crowdfunding as the funds to build the country’s first university were collected in just this fashion, long before the term came into vogue.

Up until the late 1970s, Botswana, Lesotho and Swaziland had a common university - BOLESWA at which students from all three countries would study, but then Prime Minister Jonathan Leabua of Lesotho took the decision to nationalise everything in his country, including the education system, and thus all Batswana students studying in Lesotho were sent back home.

This put Botswana in an education crisis and necessitated an immediate drive for the country to establish its own university. The estimated capital that the country would need to get the university started was P4 million; it would have been almost impossible for the country to raise that amount of money on its own, but President Seretse Khama wisely decided that they should, as Batswana, make the effort to raise the initial P1

million themselves and then approach donors for the rest.

A team of proven public servants was formed to raise funds for the construction of the university and was dubbed the Botswana University Campus Appeal (BUCA) committee. Khama himself travelled the country with them, meeting with everybody from tribal leaders to councillors and charity figures in order to explain to them the purpose of the initiative and how they could make contributions.

Contributions were accepted in any form, whether it was cows, goats, chickens, eggs, beans or just about anything of value and were then auctioned through the Matimela masters structure.

President Khama led by example, contributing no less than 30 heads of cattle from his personal stock. The appeal proved to be a massive success as they managed to raise the P1 million, borrow the rest of the money from donors and officially open the institution in 1982.

»» The estimated funds raised by CFPs totaled $5.1 billion in 2013, up from $2.7 billion in 2012. »» The estimated number of active crowdfunding platforms stood at 536 (2012), running more than 1 million successful campaigns. »» The value of the average successful crowdfunding campaign is around $7,000 and it lasts around 9 weeks. »» In 2014, crowdfunding is expected to inject $65 billion into the global economy, creating 270 000 jobs by providing $10 billion in funding to startup companies. »» The crowdfunding industry has grown 1000% in 5 years. »» Crowdfunding is set to grow by 92% in 2014. »» By 2020, crowdfunding is expected to contribute $500 billion in funding per year, generating $3.2 trillion in economic value annually and creating more than 2 million new jobs. »» News Headlines covering crowdfunding have increased 9 900% since 2004. »» In the US, the 80-year ban on general solicitation was removed in 2013, allowing companies to publicly pitch their companies to investors. »» The US Securities and Exchange Commission (SEC) is working on a provision in the JOBS Act that will allow all US citizens over the age of 18 to invest in private companies. »» Every $37,702 invested in start-ups creates 1 job. »» Every $1 invested in start-ups creates $6.36 in revenue.

(Source – South African Real Estate Investor)

BOIDUS FOCUS November 2014

Guest Columnist Page 19

The Art Room Latest Exhibitions

by Sophie Lalonde

A collection of work from the Kuru Art Project has recently been on exhibition at Sophie Lalonde Art. The exhibition opened on 9th October and closed on 5th November 2014.

Kuru Art project began in 1990 in the village of D’Kar in western Botswana. Kuru is the Naro word meaning ‘to do’ or ‘to create’. The project provides a space for San artists to creatively express their traditions as well as recent life experiences. Their artwork is heavily weighted with their traditions and culture as well as contemporary elements, which give us a small insight into how their lives are changing.

These artworks have become acclaimed worldwide, having been exhibited in Poland, Finland, The Netherlands, Norway, The United Kingdom, USA, Canada, Namibia, Germany, Australia, Sweden, South Africa and of course their home, Botswana. The artworks have won international awards and become sought after pieces for public and private collections throughout the world.

The artists participating in the project all live in D’kar and have grown up in and around the Kalahari, Ghanzi district. In addition to being artists, they are skilled traditional dancers, storytellers, musicians and craftsmen. It is essential to them that they play an important role in the conservation of their culture through their art.

It is with huge pride that Sophie Lalonde Art exhibited work from Botswana, which is so authentic and true to a native culture.

rica as well as in Europe, and is currently an art teacher at Maru-a-Pula School in Gaborone, Botswana.

Many of the artists have had no artistic training so their art is purely what they see, feel and imagine and thus possesses a uniqueness that not many other artists internationally can claim.

Steve has worked for a year developing this new collection, which ranges in medium with a mix of oils and watercolours. The theme for the exhibition is based around the title Another Year signifying a year in Steve’s life. It ranges from delicate and subtle watercolours to emotional and thought provoking oils on canvas.

On Thursday 13th November, Steve Jobson’s Another Year exhibition opens at Sophie Lalonde Art and will run right through until the end of January 2015.

Steve trained as an artist in the UK and South Africa; he has exhibited in Botswana, South Af-

The exhibition follows the ebb and flow of Steve’s thoughts during the last year, exploring not only his experiences but also connecting with the universal ups and downs of the viewer.

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Professional Practice Page 20

BOIDUS FOCUS November 2014

Project Time Extensions – BIDP Versus JBCC

by Euan Massey and Natalie Reyneke

cause of the delay to the Architect, and if in the opinion of the Architect the completion of the Works is likely to be or has been delayed … , (a) by force majeure, or (b) by reason of any exceptionally inclement weather, or (c) by reason of loss or damage occasioned by any one or more of the contingencies referred to in clause 20(A), (B) or (C) of these Conditions, (d)…

The BIDP (Botswana Institute of Development Professionals) form of building contract (“BIDP”) has, in more recent years, been joined by the Joint Building Contracts Committee Series 2000 suite of contracts, Edition 6.1 March 2014 (“JBCC”), as the commonly used standard forms of contract for the execution of building contracts in Botswana. Although both of these contracts are building contracts, they offer differing options with regards to the apportionment of risk between contractor and employer and the mechanisms available for the administration and management of the contract. One of the mechanisms of the contract that differs between the 2 forms of contract is the mechanism dealing with an extension to the completion time of the project. This article will examine these differences briefly.

The majority of building contracts require the contractor to complete the works by a specified date, failing which the employer will be entitled to recover a predetermined amount of damages for delay.

The contractor will only be relieved of its obligation to complete by the contractual deadline if an event occurs for which the contractor is entitled to an extension of time. A well drafted extension of time clause will be of benefit to both the employer and the contractor in that the contractual time for completion will be maintained, the employer’s right to predetermined damages will be preserved (which in turn gives the contractor certainty as to its financial exposure), and the contractor will be relieved from its obligation to complete the works on time when it is delayed by the occurrence of certain specified events.

Both the BIDP and the JBCC contain contractual dates for completion of the works. Similarly, both contracts have extension of time clauses.

Clause 23 [Extension of Time] of the BIDP states: “Upon it becoming reasonably apparent that the progress of the Works is delayed, the Contractor shall forthwith give written notice of the

then the Architect shall so soon as he is able to estimate the length of the delay beyond the date or time aforesaid make in writing a fair and reasonable extension of time for completion of the Works. Provided that the Contractor shall always use constantly his best endeavours to prevent delay and shall do all that may be reasonably be required to the satisfaction of the Architect to proceed with the Works.” [Our emphasis] Essentially, in the BIDP, the contractor notifies the architect once the works are delayed. The requirement to give the notification “forthwith” cannot be too difficult to adhere to, seeing as the requirement is that the contractor “is delayed” and therefore the contractor should be well aware of this. Thereafter, the architect “as soon as he is able to” estimates the delay and makes in writing an extension to time for completion, if he is of the opinion that “the completion of the Works is likely to be or has been delayed beyond the Date for Completion.”

This clause is not too different to the extension of time provisions in the JBCC in some respects. Clause 23 [Revision of the Date for Practical Completion] of the JBCC contains the contractor’s entitlement to the revision of the date for practical completion. The contractor’s entitlement to such revision is split up into 2 types of revision – the first being a revision without an adjustment to the contract value, and the second being a revision with an adjustment to the contract value. So too, in the BIPD, may the contractor be entitled to an adjustment to the contract sum, but only in respect of direct loss and/ or expense which the contractor has been invoiced. The instances where the contractor may be entitled to such direct loss and/or expense is found in clause 24 of the BIPD, and in terms of this clause, the contractor has to make written application for reimbursement of such direct loss and/or expense.

In both standard form contracts, the specific events that would entitle a contractor to a revision of the date for practical completion, or an extension of time, respectively, are specifically listed, and the contractor will have to identify into which clause the event falls. There is also a “catch-all” type of clause found in clause 23.3 of the JBCC and clause 23 (j) of the BIPD, whereby the contractor may be entitled to a revision of the date for practical completion and an adjustment to the contract

value for delays due to any other cause beyond the contractor’s reasonable control that could not have been reasonably anticipated or provided for / foreseen. Such circumstances are, however, limited to the ability to secure labour, goods or materials in the BIDP. There are further similarities between the two contracts. The contractor has an obligation to take steps to avoid, prevent or reduce the delay. However, neither of the contracts provide a remedy to the principal agent in the event that a contractor fails to do so. In both the JBCC and the BIDP, the entitlement to an extension to the date for practical completion / time for completion is triggered by the contractor provided notification to the principal agent / architect – and this is where the similarities end.

Clause 23 of the BIPD contains no defined time frames within which the contractor and the architect are required to act. Loose terms such as “forthwith” and “as soon as he is able to” are used, with no apparent sanction on either party for failing to act in accordance with these terms. There are certainly no time-bar provisions in the BIPD. On the other hand, Clause 23.4 of the JBCC provides for a distinct process to be followed by a contractor when faced with a circumstance which could cause a delay to the date for practical completion: “… the contractor shall … within twenty (20) working days of becoming aware or ought reasonably to have become aware of such delay, give notice to the principal agent of his the intention to submit a claim for a revision to the date of practical completion failing which the contractor shall forfeit such claim.”

In addition, Clause 29.5 of the JBCC states that: “… the contractor shall submit a claim for the revision of the date of practical completion to the principal agent within forty (40) working days, or such extended period the principal agent may allow from when the contractor is able to quantify the delay in terms of the programme.

The contractor is required to state in its claim: • The relevant cause on which the contractor relies; • The cause and effect of the delay on the current date for practical completion, where appropriate, illustrated by a change to the critical path on the current programme; and • The extension period claimed in working days and the calculation thereof.”

Once the claim is received, the principal agent has 20 working days to, inter alia, grant in full, reduce, or refuse the working days claimed, and

give reasons where such claim is refused or reduced. Further, in terms of clause 23.8, if the principal agent fails to act accordingly within the 20 working day period specified, the claim is deemed refused. The contractor may then proceed to dispute resolution.

It is glaringly obvious that the JBCC contract contains much stricter provisions for the contractor and the principal agent. This is possibly due to the fact that contractors in South Africa have for years been suffering at the hands of slow paying employers. A JBCC committee has been established which is made up predominantly of contractors.

The committee is responsible for the updates to the JBCC documents, and this has ensured that the JBCC has evolved into a document which sets out exact rights and obligations of the parties, more particularly, what the contractor’s rights are when he is not paid on time. One of the examples that comes to mind is that contractors, when submitting claims for extensions to the time for completion, would like to know sooner rather than later whether or not they will be granted such extension and any concomitant adjustments to the contract value. Historically, employers were taking their sweet time, and often, contractors were finding themselves in the situation where all claims were being dealt with at the very end of the project – often with dire financial consequences for the contractors.

The evolution of the JBCC has ensured that specific time frames are in place for actions by both parties. If a party fails to act within these timeframes, there are consequences. The contractor may forfeit his claim if he does not comply, but on the other hand, a claim will be deemed to be refused if the principal agent does not respond timeously. This will mean that the contractor can immediately refer the matter to dispute resolution.

These rights are not so clear in the BIDP. While it might look rather attractive to a contractor to enter into a contract with no time bars for claim submissions, don’t be fooled. You may find yourself in a position in which your claims are dragged out and only dealt with at the end of the project. Fighting for money at the end of the project may put you in the position where you would accept less than the aggregate value of the claims that have amassed during the project, as a settlement to bring in the cash.

BOIDUS FOCUS November 2014

Editor’s Note / Guest Columnist Page 21

Clerk of works

Editor’s Note:

events, monitor building quality and oversee conformance to the contract documents. This role on many projects has been seen as essential, especially when contractual disputes arise and the records from an independent third party can be used as a factual unbiased source of information.

Many clients consider that employing such an es-

by H. Killion Mokwete, RIBA Chartered Architect

BOIDUS TEAM

On one occasion I called in on a Gabz FM radio show where he was discussing plans to launch the project management and audit teams. Frustrated that he was always ready to admit mistakes but slow to take corrective action, I put it to him that I felt his DBES was not fit for purpose. I continued this critique when his ministry fired 13 East African DBES personnel on the pretext that they had been involved in corrupt practices; my argument being that instead of dismissing and expelling them from the country, Government should have tried them in a court of law in order to get to the bottom of their deeds. With allegations of corruption high at his ministry, I was also very critical when his then Permanent Secretary Carter Morupisi, now at the Office of the President, was alleged to have been involved in an attempted bribery by some Chinese contractors. Many questions were left MANAGING EDITOR

ART DIRECTOR

DISTRIBUTION

H. Killion Mokwete

Bridget T. MacKean

Martha Rooi

DEPUTY EDITOR

GRAPHICS ASSISTANT

GUEST COLUMNISTS

Kibo Ngowi

Taelo Maphorisa

STAFF WRITER

SALES

Keeletsang P. Dipheko

Tara Michelle Theron Tebogo Sekwenyane Thabo Sarona

Barulaganye R. Motlogelwa Euan Massey & Natalie Reyneke Sophie Lalonde Tshepiso Motlogelwa

ACCOUNTS

Ngwewabo Mokwete

BOIDUS FOCUS

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sential role is now not affordable given the current

unanswered as these suspects later fled the country and their case never went to court.

However, it has to be acknowledged that through his candour and readiness to admit mistakes and seek solutions, the man stuck to his task and managed to achieve some remarkable successes on some of the key Construction Industry issues. What had eluded most ministers before him at this ministry was not just the solution to the DBES problem, but rather finding a long lasting solution to the industry through a formalised manner which could put the professionals and consultants in order. Johnie Swartz set about formalising the industry professionals such as Engineers, Architects, Real Estate Agents, Quantity Surveyors and others through the establishment of registration councils. This move was later topped off by completing a draft bill for a regulating body for the entire Construction Industry. Although he left before the bill could be presented in parliament, Mr. Swartz did for the industry in a short space of time what other ministers who had preceded him could only dream of. The foundations are now laid for the incoming minister to finish what Swartz started. I for one think Johnie Swartz has laid a solid legacy at MIST as the man who took charge and worked diligently with the industry stakeholders to deliver much needed change. The industry will miss him dearly and I hope in his next move success will follow him.

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gage an independent site inspector for clients to have a representative visit their site to record

Tribute to Johnie Swartz – A Man Who Laid Needed Foundations of Change for the CI He was dealt a bad hand when he took over an ailing ministry ravaged with multiple incidences of scandal and a contentious DBES department, which at the time was a hot bed for incidences of malpractice. Upon taking over, he set out on engaging in plans to turn the ministry and the notorious department around. I personally have been a fierce critic of his ministry and have at times been critical of him personally, especially when it seemed that there was a great deal of talk about solving the pertinent issues of the CI with little action to show for it.

It has long been an established practice to en-

economic situation. This is in fact a false economy; if ever there was a time when such a service was in need it is now. With contractors working hard to win contracts by submitting the lowest tender,

Barulaganye R. Motlogelwa Construction Industry Lecturer New Era College

WHY INDEPENDENT SITE MONITORING & INSPECTION IS NOW MORE VITAL THAN EVER

there comes the risk to clients of short cuts in quality, and an increase in claims in order to make up short falls in tender prices.

Independent site inspectors & clerk of works provide reassurance and peace of mind that the activities being carried out are in line with the contract documents and general good practice. They monitor the conditions that works are carried out and ensure that the works meet

The clerk of works (or clerk of the works), often

manufacturer’s recommendations. They witness

abbreviated CoW, is employed by an architect or

tests to verify that the works meet specified re-

a client on a construction site. The role is primarily

quirements. They monitor progress against pro-

to represent the interests of the client in regard

gramme so that an independent view of where

to ensuring that the quality of both materials and

the contract is at any given stage is balanced

workmanship are in accordance with the design

against the contractor’s own assessments. By

information such as specification and engineering

providing weekly reports they are able to pro-

drawings, in addition to recognized quality stan-

vide advice on all aspects of the works in prog-

dards. (Wikipedia, 2014)

ress and highlight any concerns.

THE MALL OF AFRICA CONTINUED FROM THE PAGE 08

Professional Practice Page 22

BOIDUS FOCUS October 2014

Performance Bond – Its Purposes and Implications

by Boidus Admin

Bonds are provided as useful means of creating financial security for the Employer for the Contractor’s failure to perform his contractual obligations. Generally, a bond is an arrangement under which the performance of one party (A) to another party (B) is backed up by a third party (C). What happens is that C promises to pay B a sum of money if A fails to fulfil the relevant duties. In this context, A is commonly known as the principal debtor or simply principal; B is called the beneficiary; and C is called the bondsman, surety or guarantor.

In the construction context, such back-up is likely to come from one of the two sources below: (a) Parent Company Guarantee – the contractual performance of one company within a corporate group is underwritten by other members of the group; or (b) Bonds – normally provided (at a price) by a financial institution such as a bank or an insurance company.

Performance of the contract in general is the most common type of bond, in which every aspect of the Contractor’s performance is guar-

ATTENTION CONTRACTORS

LET US TAKE YOUR RISK BECI is the only credit insurer in Botswana, set up in 1996.

The primary function of BECI is the granting and development of credit insurance. The company has evolved through time into issuance of other related products, such as Construction Guarantees and related guarantees. BECI has been instrumental in the development of credit discipline in the country.

anteed. The contract frequently requires a bond, normally to a level up to 10% of the contract sum.

The usual form of bond used in Botswana is a Performance Bond which guarantees the Contractor’s performance of the contract with an undertaking to be bound in a specified sum until (and unless) such performance is achieved.

Upon the Contractor’s failure to perform in full, the Employer is entitled to call on the surety (or bondholder) to make good the loss, up to the maximum amount of the bond. Since a bond is a contract of guarantee, it requires to be evidenced in writing. Further, since the Employer gives no consideration (save that the Contractor must include the cost of the bond in his price for the works) the bond must be made by deed. The construction contract and the bond are interrelated, since the bond is a tripartite transaction involving the parties to the construction contract and the bond.

Nonetheless the bond is a separate and wholly independent legal document enjoying autonomy from the construction contract. In that sense the bond is independent of the construction contract.

Performance bonds are traditionally categorised as being of two types. The first type is the ‘conditional’ bond, where the surety agrees to pay if and when certain specified conditions are satisfied. The most likely condition would be any default (i.e. breach of contract) by the Contractor.

The principal characteristics of this type of bond are namely: • It is a contract of guarantee whereby the surety (guarantor) accepts ‘joint and several’ responsibility for the performance of the Contractor’s obligations under the engineering and construction contract (i.e. the principal contract); and • The surety only becomes liable upon the operation of the ‘trigger clause’, i.e. proof of a default/breach of the terms of the principal contract, and the Employer (beneficiary) sustaining loss as a result of such default/breach.

With construction insurance from BECI, you can get on with your contract works without having to worry about the risks that often come with a project.

BUILD WITH CONFIDENCE

BECI provides guarantees to ensure that your contract will be performed according to its terms. In the event that the contract is not performed, BECI will pay damages if the contractor cannot.

BECI surety bonds, or guarantees, include: • Bid/tender bond • Performance bond • Advance payment bond • Retention bond • Letters of intent

LOSS, DAMAGE AND INJURY BECI also provides insurance cover for: • Contractor’s All Risk, and • Worker’s Compensation For over 15 years, BECI has been helping entrepreneurs in Botswana to minimise credit risks, improve cash flow and focus on what really matters: growing their businesses.

Tel: +267 31 88015 Plot 142, Unit 1 Kgale Mews [Opposite Game City, next to ē voice]

www.beci.co.bw BECI is a subsidiary of Botswana Development Corporation

The second type of bond is the ‘unconditional’ bond which entitles the beneficiary to call upon the surety for payment whether or not there has been default under the principal contract, provided only that the call is not fraudulent. These bonds exhibit the following characteristics: • It is a pledge by the surety (guarantor) to indemnify the beneficiary (i.e. the Employer) merely when demand is made upon him by the latter; • It entitles the beneficiary to call upon the surety for payment whether or not there has been default under the principal contract provided only that the call is not fraudulent The duration of a guarantee depends upon the terms in which it is given. If no specific time limit is mentioned, then a surety for the Contractor’s performance is not released by completion or even by the final certificate but remains liable, as does the Contractor, for any breach of contract which comes to light within the relevant limitation period.

Generally, as a rule, a performance bond remains in force until the stated discharge date which is usually either after practical completion of the works or after making good any defects. However, should the practical completion or making good of defects occur earlier than the bond date, the bond cannot be recalled or withdrawn unless the client agrees to an earlier release date.

Furthermore, a performance bond is not an insurance policy which normally is a contract of indemnity under which the insured is indemnified in the event of loss, subject to the adequacy of the sum insured.

BOIDUS FOCUS 2014 October

Advertising Page 23

COMPANY PROFILE Scotch Macdonald (Pty) Ltd. Trading as Delta Glass & Aluminium has developed a wealth of experience over the years in Botswana Architectural Glass and Aluminium supply market. Delta Glass & Alu minium is Botswana’s foremost supplier of Suppliers of: an enormous variety of specialised glass PO Box AD 214 ADD Gaborone products and Architectural aluminium Architectural Aluminium & Botswana applications such as Shop front systems, Tel: (+267) 3925395 Glass, Curtain Wallings, Shower Curtain Wall, windows and doors, shower Fax: (+267)3925350 and Patio Doors cubicles, skylight and Louvers and numer

ous other products that complement the

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Gaborone West Industrial As an active member of the Botswana BuCompany Profile Gaborone, Botswana reau of Standards technical advisory com-

mittee we at Delta Glass & Aluminium Scotch Macdonald (Pty) Ltd. Trading as Delta Glass & Aluminium has developed a wealth of Tel: (+267) 3925384 / 95 combine the technical expertise of the experience over the years in Botswana Architectural Glass and Aluminium supply market. Delta Fax: (+267) 3925350 most experienced glass and aluminium Glass & Aluminium is Botswana’s foremost supplier of an enormous variety of specialised glass Cell: (+267) 71321032 products and Architectural aluminium applications such as Shop front systems, Curtain Wall, designers and engineers in Southern AfriEmail: grantstacydelta@gmail.com windows and doors, shower cubicles, skylight and Louvers and numerous other products that complement the Fenestration Industry.

As an active member of the Botswana Bureau of Standards technical advisory committee we at Delta Glass & Aluminium combine the technical expertise of the most experienced glass and aluminium designers and engineers in Southern Africa to render expert opinion on all aspects of aluminium and glass fenestration, we help determine the best solutions, both technically and economically, with systems and products that have been carefully engineered and thoroughly tested to comply with the most stringent performance specifications.

Operating from our 1600 square metre warehouse in Gaborone west industrial, Delta has a most comprehensive distribution network in place to service local and northern businesses with our fleet of purpose built vehicles. Most importantly, Delta boasts a team of highly experienced technical, production and management personnel focused on maintaining the high level of service and quality standards for which we are renowned.

ca to render expert opinion on all aspects of aluminium and glass fenestration, we help determine the best solutions, both technically and economically, with systems and products that have been carefully engineered and thoroughly tested to comply with the most stringent performance specifications.

Operating from our 1600 square metre warehouse in Gaborone west industrial, Delta has a most comprehensive distribution network in place to service local and northern businesses with our fleet of purpose built vehicles. Most importantly, Delta boasts a team of highly experienced technical, production and management personnel focused on maintaining the high level of service and quality standards for which we are renowned.

Advertising Page 24

BOIDUS FOCUS November 2014

BHC SPONSORS THE 2014 PROPERTY EXPO

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5 8 CAPTIONS 1. Ms Moseja Lesetedi, BHC Estates Officer (Property Sales) discussing with a client 2. Mr Matshelo Chimbombi, BHC Estates Officer (Property Management) discussing with a client 3. Mr Mookodi Seisa, BHC Marketing and Research Manager answering questions at the Property Developers Summit 4. Mr Boitumelo Muzanywa, BHC Marketing Intern assisting clients 5. The crowd gathered at the BHC stall for the 2nd Quarter Sitting Tenants Draw 6. Mr Thabo Mampane, BHC Estates Officer (Property Management) assisting clients 7. Mr Kefentse Mbaiwa, BHC Customer Care Officer assisting a client 8. Lots of amazing prizes were up for grabs 9. Lots of fun activities took place at the BHC stall 10. Mr Nkaelang Matenge, BHC Deputy Chief Operations Officer (Operations) with some of the winners

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he Botswana Housing Corporation (BHC) sponsored the 2014 Property, Investment, Décor and Lifestyle Expo as part of its Exhibitions strategy. This memorable event was hosted at the Fairgrounds-Boipuso Hall from the 16th to 18th October, 2014 under the theme: “Enhancing Property Investment Opportunities in Botswana”.

the country.” He further said “the partnership will give BHC’s brand good mileage in terms of positioning within the property development market both locally and internationally. I therefore would like to further appreciate your presence as different media houses and very important stakeholders towards the achievement of this Corporation’s mandate” said Mr. Motswaiso.

The magnificent event started with a build-up activity where BEE invited one of its important stakeholders-the media, to the Expo Briefing. During this activity, the BHC unveiled the sponsorship to the tune of P100.000.00 towards the Botswana Property Expo 2014. This partnership was officially announced by the BHC Chief Executive Officer (CEO) of the Corporation, Mr. Reginald Motswaiso who handed over the sponsorship cheque. While handing over the cheque the BHC CEO said “I am very much delighted to be handing-over this sponsorship that will contribute positively towards the promotion of the property industry in

One of the activities during the Property Expo was Property Developers Summit organised by Business Events and Exhibitions. Speaking at the Summit, the Marketing & Research Manager, Mr. Mookodi Seisa highlighted important aspects surrounding the property development market in Botswana including challenges and interventions faced by the BHC. Mr. Seisa emphasized that BHC has different interventions to enhance property investment in Botswana; some of them being the current Sitting Tenants Campaign. BHC is coming up with different interventions of achieving its mandate which is to accommodate Batswana.

There is the current Sitting Tenants Campaign through which we encourage tenants who are renting to purchase their leased houses. BHC also has an initiative of homeownership drive where majority of new developments are sold while less are availed for rental.” Seisa said.

The Marketing and Research Manager also underlined that the Corporation sells only to Batswana and citizen owned entities and that BHC builds in areas where there is effective demand for houses to encourage more Batswana to own properties.

He said all these initiatives come with challenges such as sourcing of land, cost of development and different restriction/regulations. “It is very imperative to point out that there are so many challenges in all these endeavors and as a Corporation, we are employing certain interventions to overcome these challenges.” Mr. Seisa said.

The Summit attracted speakers in the Property Development industry such as Design 360 Architects, Exponential, Bond Brokers and different financial institutions. BHC got multitudes of customers visiting the stall to understand more on BHC products and services.