Interview with Dr. James Orleans-Lindsay, Executive Chairman of JL Holdings and CEO of JL Properties

What is your assessment of the current trends in the Ghanaian real estate market?

In Ghana, the real estate market stands out as one of the most intriguing arenas to navigate. Over the last 25 years, it is the only market I am familiar with globally, and it is characterized by consistent growth. For example, in 2005, a two-bedroom semi-detached property in an upmarket area like Spintex Road was priced at $35,000. Fast forward to today, and the same property commands $140,000. This upward trajectory in prices year after year is noteworthy. Accra has undergone a significant transformation, evolving from a city with a population of 1.5 million to now accommodating over 6 million people, resulting in heightened demand for accommodation.

Despite the market's attractiveness, there is a shortage of proficient developers, and the absence of best practices contributes to inflated construction costs, affecting the realism of property prices. However, this scenario creates an opportunity for substantial players to enter the market, offering improved practices and realism in pricing. In essence, the real estate market is evolving, and the emergence of a secondary market, where individuals trade homes for new opportunities, adds another layer to its dynamism. It is indeed an extraordinary market.

Given the current demand for people to own homes, do you believe they can find what they need here?

Ghanaians are quite unique in their approach to home ownership. It is fascinating; you will encounter individuals who express their intent to buy a home by presenting a deposit upfront – say $30,000 or $40,000. They might not return precisely in two months, but within three or four months, they are back with another deposit, perhaps $50,000. This practice is unlike anything I have witnessed elsewhere, especially considering the conventional route of dealing with banks. It stems from our cultural upbringing, where parents emphasize saving for a home when one secures their first job. It is ingrained in our minds, and people diligently save toward this goal. Some may keep their savings under the bed, but the intention is clear – they aspire to own a home.

This growing pressure for homes is bound to persist, but there is a need for a balance with pricing. While the demand is high, prices, particularly for luxury homes, tend to be steep. The actual market sweet spot lies in the mid-range, appealing to professionals like bankers, middle-level managers, and government employees. With the right pricing, there will always be buyers. However, factors like commuting pose a challenge, and this is where JL comes in as an inner-city developer. We specialize in revitalizing disused or disputed lands in the city center. Often, we resolve long-standing litigations, bringing families together and transforming neglected city spaces into valuable parcels of land for development. Commuting is a significant hurdle, and with the city center being the hub of power, government offices, and ministries, our strategic focus on these areas makes us one of the most sought-after real estate companies in the country.

What sets JL Properties apart?

Our distinctiveness lies in two key factors: pricing and location. We pride ourselves on clear and transparent pricing and strategically selected locations. Another aspect that sets us apart is that we are the only real estate company with eight live sites simultaneously in different locations. This means that when a client approaches us, there is a high probability of finding a suitable property among the ongoing projects in areas like Spintex Road, Weija, Achimota, Achimota Mall, East Airport, East Legon, and Roman Ridge.

We understand the Ghanaian market, and our tailor-made products cater to diverse preferences and budgets. Unlike some competitors who focus solely on luxury apartments, pricing them at $200,000 or more, we are committed to providing housing solutions for the people of this country. Our goal is not to linger on one project for years; instead, we aim to construct homes for the nation, achieving a remarkable pace of 200 homes per year. Recently, we have entered the apartment sector, initiating a project with 250 new apartments in Roman Ridge, priced at $64,800. This move has been met with skepticism from some, initially considering it a scam until they recognize the involvement of JL Properties, signifying our seriousness in entering this sector.

Understanding our market, presenting what people want, and maintaining reasonability are key principles. We do not aim for exorbitant profit margins; our focus is on volumes, providing homes for everyone in the country. The housing shortfall of 1.7 to 2 million is not due to unavailability but rather pricing issues. Crossing the $100,000 mark for a home poses challenges as it surpasses the salary range of the average worker. Mortgage finance interest rates, exceeding 30%, further compound the issue for the average worker. I have advocated for a real estate fund from the government to support companies in building affordable housing, and I have seen news about its setup, although we are cautious and want to ensure its success before getting involved. While we have been invited to join the affordable housing scheme, we prefer to take our time and assess the situation thoroughly.

Are you involved in social housing, or is there any collaboration with the government?

Well, the reality is that when governmental institutions or officials consider projects within a certain price range, they often reach out to us. While we may not specifically focus on social housing, our approach is socially related. We question the notion of affordability, as a $100,000 home might be deemed affordable to some but not to others based on their background. For instance, we were contracted by the Parliamentary Services Board to construct 100 new apartments, set to be completed by June this year. The Lands Commission, responsible for land regulation in Ghana, also approached us for the construction of 16 new apartments. Our approach is centered on reasonability and delivering quality work in real estate. We are not driven by hefty profit margins but rather focus on providing reasonably priced homes and apartments to address the housing needs of the population. So, while we may not explicitly engage in social housing projects, our commitment aligns with the goal of ensuring accessible and reasonably priced housing options for the public.

Could you share details about a specific project that you are currently enthusiastic about?

Currently, we are embarking on three significant projects, with the most prominent being the Bubuashie project in North Kaneshie. This inner city development has evolved to surpass the initial Achimota Mall project, now featuring 1000 new homes across various categories. We have already signed the contracts, and ground-breaking is scheduled for next month. The land is prepared, and we are excited to commence construction. Initially, we were working on 500 new homes in Achimota, located behind Achimota Mall, and we are now halfway through that project. Following Achimota Mall, we will continue with the North Kaneshie development and our recent project in Roman Ridge, which entails constructing 250 new two-bedroom apartments. This marks our entry into the apartment sector, and we have taken a bold approach by starting with 250 units. The apartments have a starting price of $64,800 for a two-bedroom unit and are expected to be ready in 18 months from January. The first 50 occupants will move in after a two-month stabilization period. As for Bubuashie, it is a four-year endeavor, reflecting our commitment to delivering quality homes and contributing significantly to the real estate landscape.

Could you shed light on your strategy for expansion outside Ghana? Where is your primary focus?

I consider myself a visionary, always keeping an eye on lessons from companies like Ericsson and Nokia. We continuously strive to innovate and move forward. Initially, I ventured into real estate in London, having pursued my masters in Salford and my doctorate in Hertfordshire. However, I realized London did not need someone like me, and the impact I desired was not forthcoming. With too many individuals engaged in similar pursuits, I shifted my focus back to West Africa, where I felt I could make a more significant contribution. I have also experimented with real estate ventures in Portugal, which yielded some profit last year.

My overarching plan is to expand horizontally and become a key player in West Africa. Although we have encountered some challenges, particularly in French-speaking West Africa, where the pace of work and documentation processes differ significantly from Anglophone West Africa, I am committed to navigating these differences. While Francophone West Africa tends to have a more meticulous and slow documentation process, Anglophone West Africa relies more on the private sector for development, creating a distinct cultural contrast.

I am particularly fond of Abidjan and plan to stay there for an extended period. We have made significant progress, securing lands and necessary approvals. Our project in Achimota Golf hills, though initially seen as unconventional due to the site's history as a dumping ground, has showcased our ability to transform spaces. We also have plans for changing the face of Treichville in Abidjan.

In Sierra Leone, despite challenges with purchasing power, we are proceeding cautiously, learning from the overestimations made by pioneers. In terms of quality and attention to detail, I believe we are ahead of the curve in West Africa.

Our expansion into Abuja, Nigeria, reflects our strategy of starting with locations that align closely with our projects in Accra. While Lagos is lucrative, it presents challenges that we plan to tackle in the future. Next year, we are set to develop projects in Abuja and other locations in West Africa, aiming to have a comprehensive footprint across the region. The key is horizontal expansion rather than vertical, focusing on West Africa rather than branching out globally to places like London or Porto.

We would like to explore your ideas and plans for implementing new technologies, such as 3D concrete printing for houses. Can you elaborate on these initiatives?

The construction and real estate industry in West Africa, particularly in Ghana, has been traditionally conservative, relying heavily on standard block construction. While in Europe, the use of lighter materials like plasterboard is common, in Ghana, it is not widely accepted for house construction. Our goal is to introduce and educate our clients about innovative solutions, and one of the key initiatives is establishing a small concrete printing factory. Known as 3D concrete printing, this technology allows for faster construction, enabling the building of a three-bedroom house in two weeks or a four-bedroom house in three weeks. The cost efficiency is significant, as it is a programmed process, and the expenses associated with it constitute only 30% of the total budget. By utilizing robot-controlled machines, we aim to reduce the reliance on artisans, lower costs, and expedite construction, ultimately making housing more affordable.

Additionally, in Accra, where dampness and capillary action are prevalent due to the city extending below sea level, we are setting up a dampness factory. This facility will produce dampness control products, addressing the issue and reducing the need for expensive reworks. Our commitment to improvement extends to collaborating with experts embedded in our company, such as Maltese and Portuguese professionals. The Portuguese specialists focus on finishing aspects, aiming to train our local workforce to apply European-standard finishing techniques correctly. The Maltese experts contribute to foundation works and the core shell aspects of construction. In essence, these initiatives are part of our ongoing pursuit of perfection, acknowledging that it is a gradual process requiring steady steps towards progress.

Could you share your dreams for JL Properties and the broader impact you hope to achieve through your activities?

Two years ago, we set an ambitious goal for ourselves – to provide 10,000 homes in the next 10 years. As I envision my exit in a decade, I aim to have accomplished this milestone, leaving a legacy for the company. In the remaining eight years, JL Properties is poised to emerge as the leader in all aspects of real estate, including apartments. Our primary focus is on achieving this goal while simultaneously reducing the cost of homes. We strive to establish a transparent pricing regime in various city areas, moving away from arbitrary pricing.

Additionally, a crucial aspect of my dream is to create a robust network that ensures the company's continued success. It is unfortunate that many companies in this country collapse after their founders exit. We are committed to breaking that trend and establishing a generational outlook for JL Properties. This, in essence, is the comprehensive vision I am working towards.

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