LOW COST HOUSES DEVELOPMENT FINANCE PROPOSAL

`` What ought to be, can be , with the will to make it so Jim Rouse
BUSINESS DESCRIPTION
Business Name: Roadmast enterprises
Business address: Po Box 567 00600, Ngara road, Nairobi
Physical address: OJijo plaza, Ojijo road, Parklands. Off plums lane
South wing, 2 floor, suite B4
Telephone/fax: 3740525/7 Cell. 0721246595/0726993316
Email contact: kimani@roadmastravel.co.ke
Alternative Email Kimani.john7@gmail.com
Date of registration: 13
th
September 2004
Registration No: 401438
PIN Number: p 051198790R
VAT Number: 01695765
Names of partners : John Kimani Njoroge ID No. 9236933
: Judy Wachera Robi ID No. 10894001
: Felistas Wangari Waweru ID. No. 3114393
Ownership Structure
: Roadmast enterprises is a
registered partnership business.
Business ownership is as follows John Kimani
90%, Judy wachera 5%, Felistas Wangari 5%
Contact person : John kimani
Loan purpose/Amount: Purchase of land and construction of
70(seventy) low cost 3 bedroom bungalows
with all basic amenities in Juja area, about 3
kms off the Nairobi Thika highway. Jomo
Kenyatta University of agriculture (jkuat) is
headquartered in Juja. Juja town is 25Kms
from Nairobi city centre and about 15 kms
from Thika town. Our estimated total cost is
Kshs 225,722,028 millions.(approx. US$
2,508,026) We intend to purchase10 acres of
land and subdivide it into 70 pieces each
measuring about 1/8 of an acre to implant
each bungalow in its own compound. We
expect to sell each house at below Kshs5,
500,000(five millions five hundreds
thousands only).Approx. USD 62000.
Summarised cost Breakdown: Kshs 2,287,155.00 per bungalow *70 units
Total Kshs 160,100,850
Civil works: sewers, driveways, borehole, drainage,
Perimeter fencing, lighting, Individual compound walling,
Trees and plants, Kshs 25,858,304
Land costs ; kshs 34,000,000 @ kshs 3400,000 per acre.
Consultancy fees and miscellaneous costs Kshs 5,762,874
Total cost can be financed in phases monthly or quarterly
Over a period of One year.



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EXECUTIVE SUMMARY
Problem statement Opportunity to fill a need
Decent shelter is a basic human right and millions of people in Kenya who fall under the low to middle
level income brackets do not have a house that they can call their own. Most of them are either in
formal employment or in Small scale businesses. The high price of land to construct a home and the high
cost of finance/mortgage has greatly contributed to this situation. A recent survey released by the
World Bank and the Central bank of Kenya indicates that only 8% of Kenyans can qualify for mortgage
finance and they also end up paying for long periods of up to 15 or 20 years. Government statistics
indicate that the country experiences a shortage of over 200000 units annually because the annual
production of 40000 units is way below the market demand. Rents prices have also been on the rise
and its making home ownership to be a better option for many working Kenyans. The countrys
population is projected to hit 60,000,000 by year 2030 and more than 50% of that number will live in
the urban areas therefore creating a huge demand for housing. The architectural association of Kenya
in their current report predicts that the country needs to produce 6,000,000 housing units in the next
20 years if the current shortage of about 200,000 units per year is to be overcome. This will mean
producing 300000 units per year for the next 20 years.
With improving economic conditions and the growing middle class the emerging population needs
housing. In the absence of affordable, formal housing solutions, many double up in family homes, rental
houses and informal accommodation. This creates an opportunity for investors/ developers. This
population has a purchasing power to which they can respond. In Kenya, most property developers
believe that in the near future ``middle and low cost residential areas will drive demand as the
emerging middle class moves to own homes. Most will be looking for affordable houses in the range
of USD 20000 to 40000. African Business November 2008
As urbanization puts significant pressure on housing markets, property markets offer a tale of
encouraging growth. Housing supply is constrained in the affordable market as many private developers
target the more lucrative upper middle and high end markets with houses in the range of Kshs 9000,000.
There is however a major challenge of affordability among other issues. For instance a report released
by the Central bank in November 2010 indicates that the average loan size given by mortgage lenders
was kshs 4.4millions by mid 2010.The average loan size of new mortgages has now shot to kshs 6million
indicating the rising cost of acquiring a house. In total the loan portfolio by mid 2010 was kshs 62
billions. The findings are that most people who qualify for mortgage earn over kshs 120,000 per
month. Our housing product would be explicitly targeted at the income profiles of the majority in the
society. At the moment access to finance is constrained by restrictive eligibility criteria, high interest
rates, cost of inputs such as building materials and land prices assuming a speculative angle,
conservative terms and the fact that mortgage generally targets high priced housing limits access
further. High levels of unemployment and informal unemployment coupled with high levels of job
insecurity are also factors as traditional forms of mortgage require predictable and verifiable income
as lending criteria. This scenario indicates that low income earners have increasingly been squeezed out
of the homes market by high costs. The conclusion is that the growth on mortgage loans has not
translated into broad home ownership by the majority of Kenyans. This indicates that there is a critical
need for housing micro finance to complement conventional financing methods.
Solution
The time is always right to do what is right. Martin Luther King Jr.
Our proposal is about constructing decent and affordable homes targeted at the vast majority of Kenyan
families currently living in rented houses due to the high cost of houses on sale by private developers
and the very slow pace of such housing provision by government related bodies such as the National
Housing Corporation and local authorities. More than 80% of new houses constructed are for the high
and upper middle income earner segments, despite the fact that 83% of the total housing demand is
for the low and lower middle income groups. The majority of salaried and small scale business people
are looking for houses in the range of Kshs 3,000,000 to 5,000,000. Our 3 bedroom bungalows are
aimed at meeting that need. We are of the opinion that any household with either individual or
combined income of kshs 50 000 and above can afford to own this houses if they acquire some loan
even without going the mortgage route. At the moment it is clear that the housing finance market has
not moved downstream which explains the undeveloped medium to low income housing market
whose needs are yet to be met. Other laudable efforts by the government include the waiver of VAT for
private developers who construct houses for the low income earners in line with regulations set out
under legal notice No. 115, 2008 and the assignment of retirement benefits for mortgages as per legal
notice No. 85 of 2008.
Management
While our main business activities for the last six years has been provision of private transport and hotel
bookings in the tourism industry, we have acquired some real estate development experience through
construction of a several low cost rental houses in Juja and Kitengela. In addition as we diversify fully to
real estate through the proposed project, we have assembled a formidable team of qualified
professionals and suppliers with wide experience to work with us in executing this project and others
that we shall undertake in the medium and long term future. Our qualified team of architects,
architectural assistants, land surveyors, quantity surveyors, site engineer/ contractor, lawyers,
draftsmen, site foremen and skilled workers are all equal to the task ahead.
Market size and share expectation
Census results from the Central bureau of statistics indicate that only less than 5% of Kenyas urban
population lives in government owned houses. This means that all the others are catered for by the
private sector. On average less than 20% of those urban dwellers live in their own houses either
developed through own resources or bought through mortgage. This indicates that more than 70% of
Kenyans urban households live in rented houses including those in the middle income brackets. We
can therefore confidently state that there is a big and ready market if affordable homes are developed
targeting this segment(s) of the market that to a great extent is untapped. At the moment the supply of
housing stocks per annum is less than 15% of the annual shortfall. The UN Habitat observed recently
that over 70% of Kenyas active population is excluded from the formal housing finance market with
only about 14000 home loans given in a nation of 39,000,000 people. Most of the property developers
and financiers seem to have adopted a` market skimming strategy` where they target the `cream of
the market first because the profits are high and the volume is low. This situation has actually led to the
poor people being pushed to informal settlements as the middle class moves to houses previously
meant for the low income earners.
Financing in phases.
Our need for finance is to help us acquire the first 10 acres of land that we have identified in Juja and
begin the construction of 70 units of Three (3) bedrooms each with all the main services like electricity,
water, paved passages, perimeter fencing, appropriate trees and plants in each individual compound,
good access roads etc. We intend to subdivide the land into 1/8s of an acre to implant each bungalow so
that every household will have an individual title to their property. This we believe will help some of the
prospective buyers use the property as collateral for loans in Savings and credit societies, Micro
finance firms, Micro loans in banks, employer funded housing schemes, retirement benefits schemes
or others sources to acquire the much needed property. This approach can assist many prospective
home buyers who might not otherwise qualify for a mortgage loan. Our financiers will have a lien not
only on the land but also on the buildings. Our plan is to build and market the homes widely within our
target market and our financiers will release the documents for each unit on full completion of payment
either financed or from own resources. Because the houses will be affordably priced we do believe they
will sell fast and enable us to quickly repay the full loan and interest at the earliest. Our prayer is that
we shall get the loan in phases as the project progresses and the value of collateral improves.
Meanwhile we shall be marketing the homes so that interested buyers can also start making
commitments in terms of deposits or start making arrangements to obtain finance from other sources.
We shall ensure we recommend our customers to the right people in the financial services sector as way
of supporting them obtain finance to pay for the homes.
Home its the centre of our daily lives. Its the place for family and friends. Its
where we are safe from the worries of the world. Home is where we relax in comfort.
A place to call home is what most of us wish for and work towards, but for many is
simply a dream. Given a chance, most people will do everything in their power to
make the dream of owning a home come true. The dream of owning a new home can
come through the kind of affordable housing solution we intend to offer.




CORE VALUES
To achieve our vision we shall incorporate principle centered professionalism, high ethical
standards and innovative business practices and systems. Our number one value is
honesty, integrity and fairness in dealing with all our stakeholders.
MISSION STATEMENT
To achieve a strong market presence in the efficient provision of quality and
affordable shelter and enhance the communities in which we will operate through
good citizenship and social responsibility. To maintain excellent relationships with
our different stakeholders
OUR MOTTO
`Affordable homes for the people
OUR VISION
A safe and healthy home for every person
KEY SUCCESS FACTORS

Safe and quality housing at affordable prices.
Open communication between us and customers to ensure the highest level of customer
satisfaction and long lasting reputation.
To continue expanding the number of housing units while increasing the level of profits for our
business.
Good looking homes, spacious rooms and with separate green compounds for each family.
Paved driveways and an ambience that provides emotional comfort for the buyers.

GOALS/OBJECTIVES
1. To offer innovative, affordable and market driven housing
2. To achieve a sustainable financial base
85%
15%
Annual Deficit
Annual Supply
3. To reach a level where we can build more than 500 low cost family houses annually
in the next two to three years.
4. To achieve a good corporate image and visibility in the public domain
5. Use of appropriate technology to increase supply of quality affordable housing
stocks in a sustainable manner
6. To achieve continues improvement through clients feedback
7. Monitor supplies performance for quality and timely deliveries
8. To achieve mutual client loyalty and satisfaction
9. Involve our staff members/stakeholders to enable their capabilities to be utilized to
improve quality and reduce costs.
10. To work with other industry players in lobbying for further housing incentives.
MARKET NEEDS
Decent shelter is a basic human right and millions of people in Kenya who fall under the low to middle
level income brackets do not own a house that the can call their own. Most of them are either in formal
employment or in Small scale businesses. The high price of land to construct a home and the high cost of
finance/mortgage has greatly contributed to this situation. A recent survey released by the World Bank
and the Central bank of Kenya indicates that only 8% of Kenyans can qualify for mortgage finance and
they also end up paying for long periods of up to 15 to 20 years. In most cases on completion of the
mortgage they will have paid about 3 times of the original price.
Housing demand and supply annually



People also pool resources to buy land in order to subdivide and allocate to individual members.
This can help people acquire land cheaply as a starting point to owning a house. This route
though advantageous has also led to such groups experiencing management problems and
uncontrolled development where individual members build whatever type of structure they can
afford without regard to the environment in aspects like drainage, passage ways, litter/waste disposal,
trees, natural lighting and the general beauty of an area. In other cases people keep saving for long
periods before they accumulate enough money to buy a plot of land and build a home due to their low
purchasing power. Before that happens they will have paid rent over a very long period of time and in
most cases their entire working life. In the course of our survey we saw many fenced plots and stalled
construction of homes some going for several years which represents dead investment because it
means their owners are still paying rent elsewhere or would be earning an income from those
investments had the projects been completed. If such people had bought ready houses they would be
saving money from rent or at least earning rental income. Many low to middle income earners spend
over 7 years trying to complete a home.
SOCIAL RESPONSIBILITY AND ENVIRONMENTAL CONSERVATION
Doing many units together at one place also enables us to participate in the neighboring communities
welfare activities such as environmental conservation, tree planting, improvement of roads, cleanliness,
educational standards, security, health awareness campaigns, youth affairs. As a socially responsible
organization we will also continue our relationship with other charity organizations that we have worked
with in the past such as Hope for teenage mothers at Mukuru slums in Nairobi which helps young
mothers escape poverty and drugs by training them in life skills and Don Orione centre in Kandara
(Muranga) which caters for mentally handicapped children. Suffice it to say that there are enough
opportunities to serve for those who are willing.
We appreciate the importance of living in a healthy green environment as opposed to a concrete
jungle. We therefore wish to not only provide houses but also plant the appropriate type of trees and
plants with the help and advise of professional landscapers and Kenya forestry research institute (Kefri)
providing the seedlings. This will ensure we provide those who buy our houses with a wholesome living
environment.
EMPLOYMENT
Construction of low cost housing units is by nature a labor intensive exercise. We therefore expect to
hire many skilled and semi skilled workers directly on a daily basis. The jobs for most semi skilled
worker will directly benefit the youth particularly those communities neighboring our projects.
Women from the community around will also be given an opportunity to cook on site and sell food to
the large number of workers hence deriving an income for themselves and their families Others jobs
are also created indirectly by the suppliers of raw materials, food for the workers, professionals like
architects, draftsmen, building technicians, project managers/consultants Quantity surveyors, marketers
etc. The usage of machines will be kept at the bare minimum only in situations that are unavoidable. Its
important to note that we intend to replicate the low cost housing model to other parts of the larger
Nairobi metropolitan area in other towns like Machakos and Naivasha on completion of the first phase.
We can therefore continue providing employment on a fairly regular basis to those who work with us
directly and indirectly.

TRANSPARENCY
We will relate with all our stakeholders with utmost integrity by ensuring we carry out all our operations
regarding this project (and any others in the future) in the most transparent manner. We strongly
believe there is no substitute to integrity in business. Though our houses are low cost they will be
constructed according to the quality specifications outlined by the professional architects, site
engineers, quantity surveyors and other building professionals. We will set up a quality control team to
lead by a qualified building professional to constantly evaluate quality aspects at each stage of the
construction.
Our clients will also be given genuine plot sizes, timely updates of their payment status, no sudden
price increases, quality workmanship and materials, full disclosure of the designs, repayment periods
and terms, will be done at the first instance. All our suppliers will be paid fair prices for timely and
quality deliveries. All our workers will be paid fairly and on time and provided with good working
conditions and environment. We will pray to have an excellent relationship with our financiers by
ensuring we repay the loan(s) fully and at the agreed time frames. We will actually do our best to
complete the repayments earlier than the agreed time so that we can move on to other projects of the
same nature. We will welcome independent assessment of our work in progress and usage of funds by
the financiers.
OUR PRODUCTS AND SERVICES one stop shelter shop
Government statistics indicate that the country experiences a shortage of close to 200000 units
annually.
Our concept of highly affordable decent homes can be step towards alleviating the serious housing
shortage and enable many families achieve their dream of owning a home that they are passionate
about. The concept of low cost decent homes starts with identifying and purchasing blocks of land such
as 5, 10, 20 or more acres. Buying the land in such acreage enables us to negotiate lower prices from the
owners. Such land will then be subdivided into appropriate sizes such as 1/8 of an acre suitable for
erecting decent 3 bedroom houses where each family can also have a small court yard/parking and
space privacy. With subdivision we can erect at least 7 houses per acre after making provision for
passages. Such sub division and construction is only done after obtaining the necessary approvals for
controlled development from the relevant local authorities, ministry of lands/housing, National
environmental authority (Nema) etc. Each sub plot is allocated its separate title deed which is
transferred to each individual buyer on completion of payment. This concept removes the hassles of
construction from the buyer and provides them with a ready home so they dont have to pay rent or an
opportunity to earn rental income from the property if they dont opt to settle there.
TARGET MARKET.
Our low cost housing model is targeted at the many individuals and families that passionately want a
home but may not qualify for mortgage loans because of the high cost of houses available in the market.
Our surveys indicate that most housing mortgage financiers target those with incomes ranging from
Kshs 120,000 to Kshs 400,000. We intend to target those whose household incomes either individual or
combined income ranges from Kshs 50,000 to 100,000. Such people can still acquire homes if given a
flexible system where they can use the particular unit as collateral for loans in banks, micro finance
firms, Saccos, investment groups, housing cooperatives, Retirement benefits schemes managers or
other unsecured loans are also available in the market both to those in formal employment and
business.
Factors and Figures
Urban home ownership 16%
Households and living in rental homes 77%
New homes targeting high and upper middle
income earners
80%
Public sector housing provision 5%
Private sector housing provision 95%

Some banks are also offering 100% mortgage hence eliminating the need for deposits. Such buyers can
also live in those houses in order to stop paying rent elsewhere and concentrate on repaying their loans.
They can also rent out the houses to earn some rental income which can also help in the repayments. To
ensure affordability of the houses, costs at every stage have been considered particularly aspects
concerning land costs, building materials and other costs. The whole team of suppliers has been made
aware of the low cost housing strategy that they need to buy into so that they can work with us. We are
also aware of the real costs of the items on the ground and will therefore be in a position to ensure
strict cost control. We will also only work with suppliers who do not display cartel like behaviors in the
industry.
2. MARKET PLAN
It always seems impossible until its done. Nelson Mandela
Besides construction of quality and affordable homes the marketing function will be a very crucial part
of our operation for this project and others that we shall undertake in the medium and long term future
because there is a clear need for low cost housing in the country. Ours is the first step towards meeting
that need by providing home ownership benefits that will enhance our customers lifestyle particularly
when we put into consideration the fact that housing is one of the most important expenses in an
individuals life. We intend to maintain an extensive marketing campaign that will ensure maximum
visibility for the business in its targeted market. An overview of the marketing strategies and objectives
are as follows.
Developing a strong online presence by acquiring accounts for major online real estate portals
Implementing a local campaign with the businesses targeted market via the use of fliers, Newspaper,
radio adverts and word of mouth.
Establish relationships with other real estate brokers / agents within the targeted market.
Marketing objectives

Our main marketing objective will be to create awareness and interest about the homes within
our target market as away of achieving wide and fast market penetration and achieve sales. We
will also aim at achieving consumer loyalty by only concentrating our resources and efforts in
the particular market segment. We will achieve this through increased information flow to the
Savings and credit society members, Retirement benefits scheme managers, investment
groups, Micro finance institutions, Chamas and the general public. We intend to talk to the
officials of those organizations directly so that they can facilitate meetings with the members
whom we will motivate to purchase the homes by selling them the benefits of home ownership
acquired when through this particular project. We will also seek their assistance in convincing
others such as relatives, colleagues and friends to buy the units as a way of increasing sales. We
know that by building a loyal group of customers we can establish a good database and
customer profiles to rely on even in our similar projects in the future. We will also talk directly
employees of different organizations whom we know such as banks who not only meet many
clients but who also need to buy homes for themselves in some cases taking advantage of
employer sponsored housing schemes.
CLIENT PROFILE
Our potential customers are in the low to middle income range that need homes but cannot afford very
expensive houses. Most of them are looking for homes in the range of Kshs 3000,000 to below kshs
5000,000. Their home ownership decisions will therefore be based on price, quality and availability of
amenities. Since most of them are in the age bracket of 25 to 50 and still in employment or running
small scale businesses affordability and convenience of buying a ready house will be important factors to
consider because of their family and work oriented lifestyles. Their disposable income is limited to
moderate and would require installments to raise a deposit for a house as they organize their finances
to pay the bulk of the balance either through an affordable Sacco or bank loan. Their urban lifestyles will
require them to live near towns with good access roads, schools, banks, entertainment facilities,
transport facilities etc. Many of them will be attracted by the falling lending rates across the board and
avoidance of the stresses involved in building their own homes. They also respond to offers for
discounts and other promotions like the 100% mortgage financing offer by unveiled by Stanbic recently.
Most of them will be first time owners and others who may want home upgrades from semi permanent
/ incomplete houses or crowded apartments. Our survey indicates most of them prefer to live in 3
bedroom homes with own compound for the sake of privacy in the family as opposed to apartments.
Market share
The desire for people to own a home is implanted in every individuals heart and it has always been
common wisdom that given a chance one should always buy a home instead of renting but the answer
to when and how you should buy depends on how much you have. Recent industry surveys by the
World Bank, Central bank of Kenya, Stanbic investments and leading mortgage lenders all indicate a
trend of increased level of interest in people owning homes as opposed to renting. Investment in real
estate grew to kshs 61 billions over a period of 5 years. Real estate being a strong asset class has
produced consistent earnings and is inflation proof unlike the stock market whose returns fluctuate. The
industry is however under exploited particularly in the lower ends of the pyramid where the lower to
middle income earners are the majority in the country. The scramble for this industry has seen 32 banks
reporting data on mortgage portfolios in the last one year. This is an indication of the industry being in
the high growth high market share stage. The reported high margins and cash flow needs to be directed
at further growth in the industry particularly in the lower end where the market share is big and ready
as most developers have only targeted the cream of the market. More than 80% of urban dwellers are
still in rented and informal settlements. Recent data obtained from the homes expo in Nairobi shows
that over 83% of the demand for homes is in the low income and lower middle income earners.
Potential competitors
``We can never be certain about the future, we must be constantly alert to changes in the market place
and respond to them

Any high growth market is likely to attract competitors. Most of the competition however is at the
moment constrained in the high priced houses where most developers have focused on and in some
areas produced overcapacity. In the lower end of the market however the demand is still quite high and
would require government intervention to provide attractive incentives to private sector operators who
wish to develop homes on a large scale basis to meet the huge demand. Already various attempts by the
government have been seen in some areas such as the civil servants housing scheme where apartments
developed are being sold in the range of Kshs 4500,000. Other attempts include the waiver of VAT
(value added tax) to private developers who produce more than 20 low cost units retailing at between
USD 20000 to 40000. The effect of the changes in the Sacco act where they will be allowed to invest in
other areas besides lending to members has yet to be seen. With time new construction technologies
will also enter the low end of the market and claim a piece of the cake as well. Its therefore crucial for
us to keep our ears to the ground and to continually carry out a competitor analysis so that we respond
appropriately.
PRICING / Economies of scale benefits
The advantage of building many standard housing units together is that we can enjoy economies of scale
not only in the cost of land but also in building materials, surveying and subdivision, provision of
common security such as perimeter fencing, borehole /project water provision, electricity, insurance,
consultancy and marketing costs. It also gives confidence to buyers in the market when they know that
they are dealing with a serious developer. Such cost savings will enable us to sell houses to many
households that are passionate about owning homes at very affordable prices. We have considered
prices charged by others in the market and our price is the fairest particularly considering that we are
committed to serving our market with affordable homes without sudden price increases as sales climb.
The prices charged will be arrived at after considering aspects of all costs, competition and demand
within the target market. Since our main target market is price sensitive we will keep our costs as low as
we possibly can. We will use price as one of the tools to help us achieve our marketing objectives in line
with the other marketing mixes of promotion, product (the homes) and place.

PROJECT VIABILITY
Our proposal for finance has been preceded by rigorous feasibility study of the real estate industry in
the country. We have consulted widely and made visits to various places such as Kitengela, kisanju,
kiserian, Ongata Rongai, Kiambu, Ruiru, Juja and Thika. We have also made enquiries in Naivasha and
Machakos. Success in the project is to a great extent determined by the location of the land, its size,
price, distance from the main roads, distance from the main towns, the level of development in the
area, landmark institutions around, accessibility by roads, availability of schools and health care
facilities, shopping, entertainment facilities, security, population density, availability of electricity and
water. After considering all the above factors we have chosen to opt for two areas. Juja and Ongata
Rongai have emerged as the most preferred choices for our intial projects.
We are convinced that the two areas are the most marketable for our target market which is the middle
to low income earners who are a majority in the areas chosen. We have also checked the prices of
different types of houses available in the market and the areas where they are located. We have also
assessed peoples sentiments concerning home ownership at varying income levels. We also observed
that many people of low to middle income levels who wish to build a modest home using their own
resources take up to years or more to complete the project because they will still be paying rent else
where. In the course of our survey we also saw many stalled home construction projects. Many others
just postpone the home ownership decision until much later in life when they feel they will have
accumulated sufficient income to build a home especially where both a husband and wife are working.
There is also large proportion of single parent families who feel the building process is too strenuous on
time and resources and would rather look for finance and pay lump sum for a ready and affordable
home. There are many other investment groups buying houses even before completion and then selling
them at later stages when the prices appreciate. Others buy them for rental purposes as a way of
earning some income.
MARKETING STRATEGY AND PUBLICITY
To accomplish great things we must not only act but also dream, not only plan but also believe.
Anatole France
Besides construction of quality and affordable housing units, marketing and publicity as well as good
public relations will be a key success factor for this project and others that we will undertake in the
medium and long term future. All our marketing activities will be directed at ensuring we capture and
retain a substantial share of our viable market segments. We will also keep in mind that real estate is a
long term business. To ensure we get the marketing right we will seek advice from a professional
marketing services firm. Property / homebuyer marketing is the most challenging portion of the
marketing strategy because of the essential elements to reaching this audience is that we must build a
brand affinity with the customer. This task will be accomplished within our broad marketing campaign
throughout the targeted market. We will also use an internet based strategy. This is very important as
many people seeking homes to purchase use the internet to conduct their preliminary searches. We will
also develop our online website besides maintaining a sizable amount of print and traditional advertising
methods within local markets to promote the homes that we are selling.
Some of the activities that we intend to carry out to aggressively market the product include targeting
savings and credit societies, investment groups, chamas, women groups, church groups, micro finance
organizations, insurance companies and retirement fund managers. The common denominator with the
people associated with all this organizations is that they are all low to middle income earners and they
are all pooling resources to enable them achieve some financial goal in life such as owning a home,
establishing a business or educating their children. We will approach officials of these organizations and
will design an elaborate marketing plan that will run for about six months from the moment our
proposal is approved.
Savings and credits cooperatives
The aim of the meetings with the members of these organizations will be to sensitize them about our
project and give them an opportunity to buy homes as a priority without necessarily going the
mortgage route. We will strongly emphasize the benefit of home ownership. Saccos will be particularly
important because the cooperatives act is changing by July 2011and it will enable Saccos to invest in
other areas such as manufacturing, housing, Information communication technology and other areas.
Saccos have accumulated savings of more than kshs 200 billions in Kenya. We have every reason to
believe that most members of Saccos will allow their boards to invest in houses so that they can benefit
directly other than going for mortgages. We intend to talk to officials of about 20 Saccos to start with
especially those in Nairobi, Kajiado, Thika, Kiambu, Muranga, Nyeri, Embu, Meru and Machakos areas.
The reason we wish to target those areas is because we have contacts that can lead us to the officials
easily. Some the Saccos we will talk to and where we have contacts include Mhasibu, Muramati,
Mwalimu, Chai, Kenya police savings and credit, Safaricom investment cooperative, Metropolitan
teachers Sacco, Stima Sacco among others.
Housing cooperatives
It is important to note that there are over 250 housing cooperatives in the country that specialize in
assisting their members with housing micro finance loans at lower interest rates payable in up to 72
months. We will therefore work with their umbrella body National cooperatives housing union (NACHU)
which specializes in obtaining low cost funds from donors ,foundations and social investors at below
market rates to assist their members achieve their home ownership goals.
Launch /groundbreaking ceremony
Other marketing activities will include conducting a project launch/ground breaking ceremony at the
earliest opportunity such as the commencement of construction to give people an opportunity to see
the sites for themselves. We will invite the media and a few religious and community leaders in order to
give publicity to the project. Real estate agents will also be useful to us because the have good contacts
that may be useful to us in boosting sales and would be invited to such a launch ceremony together
officials of the saccos, mfis, investment groups etc
Advertising
Advertising is an activity that we must do particularly in the leading newspapers, radio, (including
vernacular stations) television and in some property magazines. Other advertisements would be placed
on notice boards in shopping malls, busy shopping centres and other convenient locations such as busy
office blocks/ churches/schools/universities. We will discuss a way of distributing application forms
through one of the main supermarkets as a way of reaching more people conveniently. We will also
send distribute fliers through churches in Nairobi, Kiambu and Thika areas.
Internet Marketing
Internet marketing has now become a quick, convenient and cost effective way of disseminating
information. We can upload photos of the houses which offer advertising space to customers especially
those dealing in property categories. We will ensure we choose sights that are highly effective in getting
potential customers such as www property.co.ke,
www.noko.com,www.jambonewspot.com,www.misterseed.com
www.jabaliafrica.com,www.dashafrica.com , www.kdiconline.org, www.mwakilishi.com,
www.kenyareal.com among others. Other online social media such as face book will also be used. This
will help us to also reach many Kenyans in the Diaspora who are willing to invest in housing to assist
their families here or for their own use when they return home due to hardships in the foreign
countries.
Property website
We will create a website solely dedicated to the property business with webmail mail to disseminate
information to our potential customers. We will create virtual tours to enhance the appeal of the homes
and allow users imagine themselves living there. Photos will be available to download or print. Search
engines and web directories will also be crucial as a way of increasing traffic.
Banks and other finance related institutions.
Some banks are seriously targeting investment groups, Chamas, small and medium enterprises (smes)
and other associations to bank with them. We will engage with the relevant officers to market the
houses to these groups by distributing pamphlets to the members. We will use the same strategy with
the microfinance institutions and insurance companies especially those dealing with retirements
benefits funds. Some of the banks and mfis we will approach include Equity bank, Family bank, KCB,
Chase bank, Cooperative bank, Family bank, K-Rep, Pawdep, Micro Africa, Jamii bora bank which gives
its members micro finance housing loans payable over long period of up to 20 years. We do believe that
these organizations touch the lives of our target market and are therefore most likely to assist them to
achieve their home ownership dreams as opposed to the more conventional mortgage route.
Media tours and interviews
We will seek to network greatly with the media and to conduct a tour of the project(S) as it progress as a
way of creating publicity and corporate brand / image building. We will also seek interviews with the
media (electronic and print) to talk about the property industry in general as a way of brand building.
We will also write effective and compelling press releases regarding property to the media.
Networking and word of mouth
We shall use intense networking with business groups, friends, relatives, neighbors, business colleagues,
competitors, Investment groups, women groups and other property agents.
We will also compile a detailed inventory of property sellers and potential buyers to facilitate constant
communication flow as a way of seeking sales.
Yellow pages
Despite the advancement of technology as a means of communication, there are still people who use
this means of as a way of getting information and listing would help to generate some sales and market
the business.
Promotional activities
Since our target market is wide we will use both the push and pull promotional strategies. By the push
strategy we shall offer commissions to property agents who eventually make a sale for each house.
Savings and credit societies, investment groups will also be given discounts as they can buy several units
together for their members. For individuals who wish to buy our homes we will give discounts to those
who express commitment by paying a deposit within a given timeframe. In each of those cases our
offers will not exceed 2.5% of the total cost of the house.
Professionals and consultancy services offered
The nature of construction is such that different professionals and organizations will be involved or
consulted in different ways and at different stages of the project. Some of the people we have consulted
or will be involved in this project include.
Site engineers/contractors Tobi contractors,
2
nd
floor, Parkside hotel building, Monrovia Street
Tel 020 614044/0722614044/0722315026
Contact person: Engineer Thomas Obiero
Email: tobiconstructors@yahoo.com
Architectural assistants _ John Gachoki
Po box 1291 00100,Nairobi, Kenya
Tel. 0720 201656 Email: johngachoki@yahoo.com
Lawyers Jusaruguru and company advocates
Summit house, 4
th
floor, Suite 417
Mol Avenue street, Nairobi
Po box 3183 00100
Contact; Vincent Madoya Afanda Tel
057253380/0722521072/0724593347Email jradvocates@gmail.com

Quantity surveyors Francis Mwangi kiiru
Ministry of public works
P o box 7515 00100 Nairobi
Tel 0722645966 Email: kiiru50@gmail.com

Building materials suppliers/Transporters (Multiple general merchants)
Contact person: John Kinuthia 0722961891: P.O. Box 685 00232 Ruiru
Property management company, Property World Limited
Jetro chambers, 2nd floor, Mpaka road Westland.
Tel 4451290/1 Cell 0722858175. Contact: Mr. Kinyanjui, CEO
Accountants and auditors Njehia and associates, Certified public accountants of
Kenya. PO Box 66848 00800 Nairobi. Bekim House 1
st
floor, Westlands.Tel
0721530498.
Bankers
Equity bank limited, Westlands branch
Tel 4454261-3 Cell 0718185950
Contact person. Mary Mugwanja .Branch manager
Co operative Bank of Kenya, Stima plaza Branch
Tel 31881/79/78 Cell 0722202096/0721743348
Contact person Henry Mukuria Business development officer
Professional marketers
Kenya forestry research institute (Kefri) For supply and advice of appropriate
types of trees and plants for greening of the project site(s)

PHASED LOAN DISBURSEMENT AND REPAYMENTS
Constructions projects are by nature done in phases with fairly good cost estimate for each phase of the
project. We will therefore request that the loan is also disbursed in phases with the first phase of 40%
being used to pay for the land and commencement of construction. This would be particularly crucial
because it also will help us to start marketing the houses and collecting deposits from potential buyers
as the actual construction progresses. Phased disbursement is also good for the financier because it
enables them an opportunity assess the usage of funds before releasing the next installment.
While we will apply to repay the whole loan plus interest in under 6 years, we will do everything possible
to complete the repayment within the shortest time possible and preferably in about three years. The
groups and individuals will be encouraged to pool resources or obtain finance from Saccos, Mfis and
banks. By doing so they can pay us for the units within short periods and obtain possession of the
houses to live in or rent out as a way of generating income. This way we can sell the houses quickly and
repay the loan to enable us move on to the next project.



Organizational structure
The world is not moved only by the mighty shoves of the heroes, but also by the aggregate of the tiny
pushes of each honest worker Hellen Keller, American Author
KEY MANAGEMENT AND STAFF ROLES.
Our short structure is aimed at ensuring effective and efficient management of the businesses affairs
through quick communication, decision making and cost savings.
John Kimani Managing partner
He is the managing partner dedicated to running the business on a full time basis.
Overall in charge of the businesses and a signatory to all bank accounts
Ensuring all operations of the business adhere to the organizations administrative policy
Corporate relations with external contacts
Hiring and general human resource administration
Spear heading the businesses marketing function and overall business development
Providing guidance on the organizations strategic direction
JUDY W. ROBI- Partner

Signatory to all bank accounts
Chairing all meetings of the business in the absence of the Managing partner
Representing the business to any external contact in the absence of the Managing partner
Approving all payments to suppliers or other service providers and ensuring timely payments
Scouting for new business opportunities and advising the other partners accordingly
FELISTAS WANGARI WAWERU- Partner

Overall ground supervision on the proposed project
Approving the quality and quantity of materials delivered and recommending payments
Ensuring contracted services are conducted to the expected level of quality and in a timely
manner
Attending management meetings and providing updates on the projects progress
Scouting for new sites that the business can invest in similar projects in the future
John Gachoki Construction/Site Manager
Overseeing all the construction work on site as it progresses in phases.
Attending all meetings scheduled with architects/ site engineers/ contractors
Ensuring the projects timelines and quality guidelines are adhered to.
Chairing the quality control committee on sites.
Checking and approving the quality and quantity of all building materials delivered on site.
Ensuring good property management of all sites.
Advising management on potential properties for prospective development.
John B K Nyaga Marketing and sales Manager
Implementing the firms marketing strategy.
Constant monitoring of consumer behavior in the property industry.
Analysing demand and supply of properties in the market with particular reference to
To our target segments.
Conducting competitor analysis/surveillance.
Planning and coordination of marketing activities like advertising, sales promotions.
Reaching out to all property dealers/agents to help in selling.
Obtaining customers feedback on quality and product improvements.

Antony Njiru Finance Manager
Oversee the preparation of all financial reports.
Liaising with our accountants and auditors in matters regarding preparation of reports
Implementing cash management strategies and developing financial strategies.
Summarizing and forecasting the firms financial position using balance sheets and income statements
Analysis of future earnings and expenses.
Advise on capital raising strategies.
Monitor and control of the flow of cash receipts and disbursement.
Catherine Mwangi Operations and Administration Manager
General coordination and planning of all office activities.
Supervision of other office personnel
Procurement and planning of all office materials.
Ensuring excellence in customer service.
Anne Ruth Wangari Office assistant
Attending to all telephone calls and answering initial customer queries.
Ensuring office cleanliness and excellent client service.
Booking appointments with clients and other stakeholders for the management.
Ensuring proper electronic and manual records management.
Recruitment, compensation and appraisal.
Our commitment to staff will always be a priority and their welfare will be taken care of the best of our
ability. Competitive remuneration will be given to each staff member and annual review in line with the
rising cost of living and the financial health of the business. We believe by fairly compensating our staff
we will not only ensure loyalty to the business but also retention. Our recruitment policy will always be
on the basis of merit and no one will be discriminated. We shall mainly depend on referrals from
credible person known to us as the business grows. In future we will outsource that service to a
professional organization. Staff members will be appraised fairly with a view of identifying their main
areas of strength and weaknesses need for training, promotion, job rotation or enlargement. Our desire
will always be to see a happy staff that will see the business as an extension of their family.
ORGANISATIONAL CHART







MANAGING PARTNER
SALES & MARKETING
MANAGER
CONSTRUCTION/SITE
MANAGER
OPERATIONS & ADMIN
MANAGER
PARTNER PARTNER

FINANCE MANAGER
OFFICE ASSISTANT FOREMAN/SUPERVISOR
JUNIOR STAFF

SALES EXECUTIVES






here are many companies out there offering machines to mass produce compressed
earth bricks. We are studying these prospects for eco sustainable villages.
COMPRESSED EARTH BRICKS

LCH Machine Specifications
The LCH Stabilised Earth Brick (SEB) Machine is easily transported onto a
construction site and can immediately produce high quality, interlocking bricks made
from the local soil. By using the unique interlocking features, LCH machines allow
"dry construction", i.e. no mortar is required to hold the bricks together. Made from
soil treated with RoadPacker Ionic Soil Stabiliser products, the LCH Stabilised Earth
Bricks (SEB) can be used within a few days of production. The fast, reliable and easy
to handle, Stabilised Earth Brick machine, will allow for low cost construction of high
quality houses utilising unskilled labour.
The construction of a 50 square metre house requiring 5,000 soil/clay bricks, can be
achieved in two or three (2 or 3) days and will be of the highest standard. The home
will also be heat resistant, sound proof and completely stable. .
The LCH Stabilised Earth Brick Machine
Features:
Fully automatic or manual modes controlled by pressure switches with built in cut off switches.
Specially designed hydraulic cooling system.
All hydraulic components are industrial grade and rated for extreme industrial use.
Retractable heavy duty sieve on hopper, filters out large rocks and foreign debris, and folds down for
easy transportation and reduced freight charges.
Engine mounted to the frame of the machine to allow for maximum vibration to keep soil moving at a
constant rate through the hopper.
Frame constructed of 10cm (4 inch) channel iron for extreme strength to weight ratio and rigidity.
All welds are double welded for superior strength and vibration resistance.
Brick molds are specially engineered for wear resistance.
Heavy duty hitch with 5cm (2 inch) ball and built in levelling jack.
12 volt D.C. electrical system.
Fully warranted free of defects in materials and workmanship (when maintained as per specifications
for one (1) year).
Specifications:
Brick size - 20cm x 20cm x 10cm (8 x 8 x 4 inches)
Production - 10 blocks per minute
Power - 80 hp John Deere diesel
Cooling system - Heavy duty radiator (Made for extreme heat)
Hydraulic pump - Vickers
Control valves - Rexroth or Vickers
Machine size - 4.72m x 2.04m x 2.31m (15'6" long x 67" wide x 76" high, 1 per 20 ft. container)
Weight - 2727kg (6000lbs)
Hydraulic Pressure - 1000kg/cm*2 to 1136 kg/cm*2 (2,200PSI to 2,500 PSI)
Hydraulic oil capacity - 55 US gallons
Hopper capacity - 1 cubic meter = 62 blocks
Unskilled labour - 6 men
Skilled labour - 1 man
The mobile integrated roadworthy trailer allows the movement of the LCH Stabilised
Earth Brick Machine from one part of the construction site to another without major
disruption to the project.
LCH Stabilised Earth Brick Dry Stacking Block
Specifications
Made
of:
"Insitu" soil plus RoadPacker Clay Brick Stabiliser compressed at over 40 tons
Bricks: Length 20 cm x Width 20 cm x Height 10 cm
Weight: +/- 10 kg
MPA : > 8 mpa
To produce good quality bricks with LCH Stabilised Earth Brick technology, the
following procedures must be adhered to:
1. A soil that contains 15%> percentage of clay, must be used, pure sand will not
work. If inferior soil or clay is to be used, then a clayey material will have to be
imported and properly mixed with the insitu material

2. Mix the soil with the prescribed dosage of RoadPacker Clay Brick Stabiliser per
m3 of material/soil.

3. Adjust the hydraulic pressure of the machine to the type of soil and moisture
used.

4. Fill up the hopper with soil and the prepared RoadPacker Clay Brick Stabiliser
mix.

5. Activate the LCH SEB Machine and begin stockpiling bricks as the are extruded
from the automated press.

6. The Stabilised Earth Bricks
produced are so
strong they can be
easily handled and
immediately stacked
for storage on the
building site.
Foundations
Good foundations have to be erected to give your building strong support. LCH
Compacted Earth Brick can be used for these foundations.(0 .3 of a litre of
RoadPacker Clay Brick Stabiliser per m3 of material/soil is recommended for
foundations as a rule.)

In this instance only (foundations), the LCH Compacted Earth Brick will have to be
assembled with mortar and carefully aligned. The first row of LCH Compacted Earth
Bricks will give the essential vertical alignment for the other rows of bricks to be
placed on to.

Easy To Assemble
LCH Compacted Earth Bricks are firmly interlocked on the top, bottom and sides. A
wall built with LCH Compacted Earth Bricks is extremely strong and highly
isothermic. Each brick is perfectly extruded and all bricks are of the highest quality.
There is no available technology that will allow you to build as fast as with LCH
Compacted Earth Bricks at such a competitive price.
How To Build A Wall
Once the foundations are built to the proper standard, the bricks should be moved
close to the site for ease of handling, then start laying the first row of bricks. Check (
with a spirit level ) that the bricks are perfectly flat, ( Note: Any angle on the first row
will throw out the vertical alignment of later rows ). The first row must be finalised
with proper attention to the levels, paying particular attention to the junctions. Once
the first row is completed, the walls will follow the set level and run true. Corners are
easy to make and in a short time the building will take shape. Walls for a 50 square
metre house are easily built in 1 or 2 days depending on the team's skill.
The LCH Compacted Earth Brick machine permits you to build using the insitu soil (
which is usually free ) and only 0.2 of a litre of RoadPacker Clay
Brick Stabiliser per m3 in the mix to achieve the most inexpensive,
strong and most attractive looking wall. This is why LCH Compacted
Earth Brick technology is the most cost-effective method of building
low cost housing, of the very highest standards.





Several Reasons Why This Technology Should Be Used.
LCH Compacted Earth Bricks allow you to use the most abundant raw material on earth, soil.
LCH Compacted Earth Bricks use only 0 .2 litres of RoadPacker Clay Brick Stabiliser per m3 to be mixed
with the soil to stabilise it.
LCH Compacted Earth Bricks being strong and highly compacted, are of the highest resistance
(>8mpa) and do not require the use of any reinforcing bars to build a completely strong durable
dwelling of up to 3 stories. (Except in Seismic Areas)
LCH Compacted Earth Bricks can be produced on the construction site, which negates the need for
transporting the bricks and thereby, reduces the risk of damaging the already "paid for" bricks.
LCH Compacted Earth Bricks utilise unskilled labour to manufacture the bricks, therefore,
employment is provided for local indigenous population and costs are kept at the lowest level.
LCH Compacted Earth Brick houses require a minimum of skilled labour to build. A professional
bricklayer supervising the job will be sufficient, all other workers can be unskilled from the local
surrounding area.
The LCH Compacted Earth Bricks are of a quality so high and a finish so good that most of the builders
do not plaster or paint the external walls. Furthermore, the majority of the low cost housing, because
of the high standard and finish, can be left with the internal walls not painted.
A LCH Compacted Earth Brick house is totally isothermic to the extent that neither the heat nor the
cold will affect the comfort of the occupants. Should the occupant decide that they wish to install air
conditioning or central heating, then their electricity bill will be minimal.


Environmental Construction Technologies Utilizing Compressed Soil Stabilized Interlocking
Earth-Bricks and Road Remediation Project Gallery
These pictures will show you our different projects worldwide. From training unskilled laborers to
become self sufficient in third world countries, to finished projects. From road remediation, soil
stabilization, erosion control, to buidling low cost affordable housing, please click on each picture
for short overview.