Rwanda Social Security Board: Giving a whole new meaning and face to real estate Development

By Thomas Kagera The travelogue unfurls as the Gaculiro hill slowlyexudes growing buildings, roads and a city with a character of its own. It slides with an intent slow motion, showing buildings that are impeccablydesigned, roads articulately planned and a groomed trim of green lush encompassing and kissing every structure, with buildings ranging from town homes, luxury apartments to mega shopping malls and social centers. Welcome to Gaculiro Vision City, 5 kilometers North East of Kigali City, to be developed by Rwanda Social Security Board (RSSB). But before we fling ourselves into this city, let us look around where the RSSB has been doing to meet accommodation needs in the country. According to the Director General Ms Angelique Kantengwa, RSSB as an institution is mandated to provide social security benefits to workers in the formal and informal sectors. “Investing in real estate development has far reaching effects. Affordable dwelling units are put in place and the Board makes a small profit for other operations,” notes Ms Kantengwa. She adds, “We have embarked on the task of increasing coverage to all sectors of the population, establishing insurance for maternity leave as well as introducing new pillars like the Provident Fund to complete the fundamental right to benefits which should be enjoyed even before retirement for example through financing education and housing.” Where does RSSB investThe social security reserves are mainly invested basing on 4 guiding principles: Security, liquidity, profitability and socio-economic utility. One of the identified financial instruments that fulfil those requirements is real estate as an investment instrument. One would presume Real Estate to be a subset of Investment Department. Recent trends indicate that, Real Estate involves massive projects and specialised engineering expertise very often needing independent consideration from other investments. Whenever the need to use social security funds in social economic development arises as it is Rwanda today, Real estate comes at the forefront. Its importance, gravity and specialised skills necessitate independent coordination. Thus it has been singled out as an Independent division. The Director General says RSSB is one of the major investment institutions in the real estate sector in Rwanda today. she says the institution has been in Real estate development since 2002—from the Gaculiro estate, the Kagugu and Batsinda, plazas around the country and the planned Gaculiro Vision City. “The Vision City will be seated on 157 ha of land, with 5000 units, and the whole projects attracting an investment of about $400m,” says Ms Kantengwa. Accommodation needs tackledThe Deputy Director General in charge of Fund Management Mr Ramba Afrique, tells the compelling story of the RSSB’s involvement in the real estate development in Rwanda. “The Estate 2020 has about 300 residential units, a school and a multi-purpose hall. We also have 50 executive apartments in Kacyiru. These are high-end unitsused when there are high level meetings—so they are rented by embassies and other international institutions. These were all built before 2007. “From 2007 to-date, our major focus has been on office buildings. There is a project of putting up commercial buildings to accommodate district branches and at the same time rent the rest of the space to interested tenants. We have however started with putting up such commercial buildings where provinces have their headquarters andtwo in Kigali. So in total we have 7 buildings. The Kicukiro Pension Plaza is already complete and it accommodates the Ministry of Health, the Local Government Development Support Fund, , the Rwanda Transport Agency and Bank of Kigali. “In Gasabo District, the Gasabo Pension Plaza has been bought by Zigama CSS and the one in Nyarugenge (near SOPETRAD) will be completed soon. Then the Grand Pension Plaza will have two floors for shopping malls, 14 floors for office accommodation and high-end restaurant at the last floor. The building will harbor high technologyfacilities including an escalator that will be the first of its kind in Kigali. The Plaza is fully booked, and will be completed before the end of this year. “The Kagugu Housing Project has 121 units that have been completed. But we are also planning to have 168 2-bedroomed apartments within the same locality.” The Mega Vision City“This is one of the biggest projects ever undertaken by the RSSB at the completion of which we shall have about 5000 units in the Gaculiro complex. The City will have medium-cost, luxury apartments, semidetached houses, town homes, and social amenities. The shopping malls, sports facilities, a school, a theater, a hospital and an efficientflow of traffic free of any hassle. “The City has been designed in an environmentally endearing manner, when it comes to sewerage treatment and disposal. A lush continuous chain of green belt within and around the Vision City has too been put under consideration. The whole project is most likely to cost RSSB about $500m.” Affordable units in the loop“We are planning to have affordable housing units in Batsinda that will number to about 200. We have acquired 100 ha of land in Kinyinya where we intend to construct 2,500 medium range houses. “In Kiyovu CBD1, we shall build a complex there, and at the former American Embassy in the city center, we shall also build a mixed-use complex. The land next to Urugwiro will be developed as an office park to Accommodate embassies and others.”“Outside the Kigali City, we have plazas in Rwamagana, Nyanza, Nyagatare and Karongi. But as we said before, every district, in the near future, will have an RSSB building.” Challenges“Acquiring land in Kigali is a very big challenge.Much of the land that would be available for development is occupied and people do not want to be displaced. Those who would have shifted ask for a lot of money. So you start constructing a unit at a very high cost. Good enough, though, RSSB has acquired enough land, so that when construction commences, there will be no shortages—at least of land. “The other challenge is that of high costs of construction materials. Rwanda being a landlocked country, far from any coastline, the cost of materials almost doubles by the time they are delivered. Besides, the construction firms lack the experience so sourcing for foreign firms becomes inevitable—further driving the overheads higher. Ends

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Rwanda Social Security Board: Giving a whole new meaning and face to real estate Development