Regimanuel Gray: A Leading Real Estate Developer for Affordable Quality Homes in Ghana

Interview with Ibrahim Bah, Managing Director of Regimanuel Gray

What is your assessment of the real estate sector in Ghana?

We in Ghana have had quite a challenging year in the real estate industry. It has even been the case for the past two years. 2018 has been one of the most challenging of those years. We are gradually seeing some semblance of a jump start in the real estate sector, but it will definitely take some time. Most of these challenges we have been facing have been external in a way. The economy has been on a downturn, even though we have started to have some positive economic indicators that things are coming back, the interest rate is coming down and job security is increasing. So, with the huge housing stock, we are hoping that these positive economic vibes will showcase in terms of us trying to sell those houses that we have been encumbered with over the years.

What is the competitive environment? Are there too many real estate companies or projects currently?

We have been here for over 25 years and we want to continue to be a leader in this industry. We have come up with quite a lot of innovative ideas in this industry and people have followed our very good examples.

There are actually quite a lot of real estate developers in the market, but somehow, we all find ourselves in different parts of the spectrum. There are low income sites who do housing types that are not too expensive. Then there are low to medium, medium to high, and high end. The more the merrier. The beauty about it is, notwithstanding that the competition is there, we all have our niche within the system. We try to survive and try to satisfy our customer base based on where we position ourselves. Regimanuel tried to see how best we can spread ourselves within that spectrum. We are in the low to medium, medium to high so we have quite a large customer base. The only challenge that we have is that there is not effective demand right now. Interest rates have started coming down and foreign direct investment has started coming back which has definitely increased our customer confidence, so people have come back to us and started asking for houses.

What makes you different from the competition? What is the key competitive advantage that you have?

Regimanuel Gray has been in business for over 25 years. We have continued to do what we know best. We build affordable, quality homes and we do not compromise on our quality. We spend quite a lot on infrastructure and services to make sure that our customers have value for money. The materials that we use are well sourced and we make sure that whatever we use in our houses can stand the test of time. That has been our hallmark. Everybody knows Regimanuel in Ghana and the diaspora, especially for non-Ghanaian residents. That has been our competitive advantage. We have a brand and it has been internationally recognized and we can showcase that at any point in time and we have been getting the due advantage from that.

What projects are you working on?

One of our hallmark projects we have been working on for about eight years now. It is in an area of greater Accra called Katanmanso. We have about 1,300 acres of land there. Our master plan is to do about 17,000 homes. We have phased those into various sections from A to J. We have started our A section which is comprised of 470 to 475 homes. We have started with a modest type of housing. We named them RG1s, RG2s, 3s, and 7s. they are mostly two to three-bedroom flats. We decided to start with the lower side of those types so that it is cheaper and more affordable for people to move in and we have a semblance of community. But down the line, we a have a mix of housing types that can go as high as the customer wants. This also includes apartment blocks. What we have recently done is to also give people the opportunity to buy service plots so that they can design and build their own house types as long as we can approve the designs and they conform with certain quality within the estate. That is a new product that we have added in within the Katanmanso Project itself. The project is slightly outside of Accra. We noticed that we did not have the required services such as water, electricity, and the infrastructure, including the roads. So, Regimanuel has joined together with the Ghana Water Force to finance the construction of the requisite materials to bring water to that site, about 2 km. We are also building a road which is actually 2 km from the main road itself. It has attracted the interest of Urban Roads and they have asked us to continue from Dodowa Road to Afienya Road which is about 10.5 km. We are trying to piggyback on that project to make sure that we can easily access the project site and with that, a lot of customers will be interested. The road is a dual carriageway, so we will have free flow of traffic from that project site to Dodowa Road. It also fits into Accra closer to the Tema site. By the time we finish that road, it will be one of the thoroughfares that will be well appreciated by commuters that are coming from that part of town east to west of Accra and it will shorten the distance considerably. So, there are quite a few things that we are doing to make sure that the site is attractive to homeowners. It is a serious challenge because all these costs have to be borne by homeowners and that makes the price of our houses a bit high. But I am sure that by the time we have finished all these services that we are embarking on that the site will be very good for homebuyers. The good thing is, when Regimanuel embarks on a project, we always have quite a lot of huge land banks. So, there are projects we started ten years or more ago that we are still working on. There is another project in Kwabenya called the Balloon Gate. We have done bungalows for Phase 1 and we are now doing two-bedroom apartments for Phase 2. We are doing about 17 blocks and we have finished about 5. So, it is still a work in progress. We also have a few other projects in Klagon and Sakumono Community 13. Those are joint venture projects. We have finished one at Sakumono. For the one at Klagon, we are trying to do three blocks of apartments, about 1,700 flats. We are working on Phase 1 of that which is about 440 flats. That is also a work in progress.

What is your international outreach currently?

We have a number of offices around the world, mostly in the UK, the US and Sierra Leone. Operationally, we are only in Sierra Leone. We are doing similar projects there building residential homes. Our offices in the US and the UK are basically sales offices where we handle Ghanaians in the diaspora who want to ask questions or any type of inquiries and also find it easier to make their payments for houses that they are interested in in Ghana.

What percentage of your clientele is local versus international?

When Regimanuel started, most of our clients were from the diaspora, about 60% of our customer base, especially from the US and Europe. But, as Ghana has gradually developed and the middle class has expanded, we have found that that ratio has changed. Now, about 65% of our customers are resident Ghanaians. The non-resident Ghanaians would be about 35%.

Do you have any big projects that you would be interested in attracting investors for?

Of course, our core competence has been building residential homes. But, in times like this, it is also nice to diversify your interest. Recently, we have seen a need and been contacted by people coming in concerning building student hostels. We have done our assessment and our feasibility and we have noticed that there is quite a lot of shortage in student hostels around all the top universities in Ghana. For example, at Kumasi University of Science and Technology the population size has grown to 60,000 students. Meanwhile, only about 10 to 15,000 students are on campus. We have a huge deficit in that regard. A lot of people have contacted us and they are ready to work with us provided that we have the requisite funding to construct these hostels. We have the ready demand for it. We want to do it in phases. Of course, the capital out is quite large but we can show any financial investor that wants to partner with us that the cash flows or the income streams will definitely pay back within the shortest possible time and the risks are quite low. We also looked at Legon, Cape Coast, they all have similar problems. So, there are quite a lot of good opportunities in that light. We are also looking into getting involved in a carpark project. We have been contacted by Ghana Airport Authority and we have found a JV to do a carpark within the airport enclave area just near the airport. We have looked at the cash flows, we have done our feasibility, and we are sure that with the right funding, if we embark on that project, it will pay for itself in a short period of time. So, there are quite a few of these projects we are looking at outside of our comfort zone of just constructing residential homes.

Project yourself into the medium term, the next two to three years’ time. How would you like to develop yourself? What is your vision for the company? What would you like to have achieved?

For any company’s vision, whether in short, medium, or long-term, it is about survival and becoming a key player in the industry. We have been here for over 25 years and we want to continue to be a leader in this industry. We have come up with quite a lot of innovative ideas in this industry and people have followed our very good examples. But we are also looking at diversifying our activities because at the end of the day, you cannot just limit yourself to a particular product type. There are quite a lot of opportunities out there and we want to be part of it. We are sure with our pedigree, with our expertise, we can be able to position ourselves for those challenges ahead of us.

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