Collapsing buildings could injure economy
Mar 18, 2009
UGANDA’S construction industry is set for lean times following the recent incidents of collapsing buildings around Kampala. The timing of the disasters, amidst the intense global credit meltdown, cannot be more disastrous.
By Ricks Kayizzi
UGANDA’S construction industry is set for lean times following the recent incidents of collapsing buildings around Kampala. The timing of the disasters, amidst the intense global credit meltdown, cannot be more disastrous.
Just in a space of less than a month, more than five lives have been lost and millions of shillings gone up in smoke as buildings come tumbling down. The most recent occurrence was the collapse of the four-storied Mirembe Shopping Arcade located on Plot 5A, Nasser Road.
Although investigations to the cause of the accident are ongoing, preliminary reports have pointed at the excavation work that was being conducted at an adjacent construction site, which forced the foundation to give way. Four people have died and over 20 critically injured.
Anatoli Kamugisha, the chairman of the Uganda Property Developers Association (UPDA), said that it is likely that banking institutions, which fork out most of the finances for construction work will be more critical when making decisions on which project to fund.
“These officials will be risk aversive when analysing applications from developers. Interest rates on such loans may go up in the long run, as banks move to accommodate the additional risks,†he said in an interview over the weekend.
He said that although the majority of buildings in Kampala lack insurance cover, those that have should brace themselves for a rise in premium in the face of increased incidents of fire and collapse.
It is on record that most construction works in and around Kampala, especially of shopping malls, is being funded by commercial banks, who retain the land titles of those sites as security in exchange for long term loans.
The hurried construction work on shopping malls has been blamed on banking institutions that do not give a grace period on such loans.
“Developers are always in a hurry to start servicing their loans. So as soon as they are done with the lower floors, they put them up for occupancy, as they continue to finish the top floors,†said Andrew Mukasa, a city architect.
Patrick Kabonero, Housing Finance Bank’s executive director for development finance, blamed laxity in enforcement of construction regulations.
Kabonero said that the recent collapse of buildings will affect the real estate sector positively. “People are now waking up to the reality that shoddy work begets disaster. Institutions which have not been observing rules and regulations and enforcement bodies such as KCC have already banned construction on some sites because of lack of minimum safety standards,†he said.
On the likelihood that banks may put in place more stringent measures on loans to real estate developers, he said such a decision could depend on managers and may vary from bank to bank.
“For us if one has approved plans from KCC or any other local or urban authority, and fulfills all our other requirements, we go ahead and approve their loan application,†he said.
On the effect these incidents would have on individual tenants especially in commercial buildings, Kamugisha said people would start fearing getting rental space in tall buildings.
The real estate sector, which has experienced one of the fastest growth rates in the economy, will also be adversely affected. This is because most of the buyers of their plots and completed houses are Ugandans living and working in the diaspora.
They do most of their purchases on the internet, and would certainly be hit by the unfortunate news in the country’s construction sector. Kamugisha blamed the accidents on fake engineers and architects, as well as KCC, which does not conduct site inspection.
“In the case of Mirembe Arcade, the engineer would have taken into consideration the horizontal and vertical forces around the building. He would not have gone further than the foundation of the neighboring buildings. An allowance of four meters on the side of each neighboring building would have been left. The foundation would not have gone deeper than three meters,†he said.
He said beginning next year, UPDA will start issuing operational permits to all building constructors, without which constructors will not be able to operate.
Joseph Magandazi Yiga, the managing director of Jomayi Property Consultants, downplayed the incidents, saying most critics are ignorant of the dynamics of the construction industry.
“In the case of the NSSF Towers on Lumumba Avenue, it was the retention wall which collapsed and not the main structure,†he said. Seven people died and work has since been suspended awaiting the outcome of the investigations.
The increasing number of collapsing buildings also raises the question of whether professional bodies such as the Allied Builders’ Union, Architects’ Board, UPDA, and the ministries of works and that of Labour are fully exercising their supervisory roles.
Nick Twinamasiko, a Kampala civil engineer blamed construction disasters on the poor reading culture, which has been exacerbated by an educational culture that promotes the fallacy that the end of knowledge is to pass examinations and get a certificate, and a recruitment culture that emphasises certificates.
Ivan Sekyewa, a valuation surveyor blames the developers unwillingness to pay professional fees to qualified engineers, architects and contractors in preference to quark ones.
Most professionals blamed KCC saying it “violates its own rules and regulations.†Apart from the fact that it has to issue a periodic certificate upon completion of each stage of construction of any building in its jurisdiction, they are also charged with issuing an occupation permit which allows people to occupy every new building and utilise it.
KCC is also blamed for substandard and badly planned buildings because of bureaucracy, lack of manpower and corruption. Muwonge Kewaza, the deputy Town Clerk attributes their inefficiency to powerful interests that “interfere with council’s work.â€
KCC recently placed an indefinite ban on construction works for huge housing projects which manifest poor workmanship and are supervised by quack professionals.
Construction projects that have been affected by the ban include Coil Industries building in Industrial Area, Makerere College’s upcoming structure, Rafik Trading Company building on Wilson Road as well as estates of Industrial Steel Masters [U] Ltd. Others include Rohana Community constructions on Plot 46-49 in Kawempe and Kamwokya and John Bosco Muwonge’s housing project on Plot 33, Nakivubo Road, said Simon Muhumuza, KCC’s publicist.
KCC has also introduced new rules, requiring developers to possess an Environmental Impact Assessment [EIA] certificate, outlining the earthworks to be undertaken and its environmental compatibility as well as provisions for treatment and discharge of on-site waste.
“There also has to be a signboard at the site to detail ongoing construction work and particulars of architects and civil engineers supervising the works,†said Peter Katebalirwe, the chief city planner.
Over the last five years, construction has been the fastest growing sector and it can be expected that a slowdown in construction will have a knock on effect on the general economy.
The Budget figures for the financial year 2007/08 indicate that construction industry grew by 10.0% in 2003/04, 14.9% in 2004/05, 23.2% in 2005/06, 14.3% in 2006/07 and 6.0% in 2007/08.
UGANDA’S construction industry is set for lean times following the recent incidents of collapsing buildings around Kampala. The timing of the disasters, amidst the intense global credit meltdown, cannot be more disastrous.
Just in a space of less than a month, more than five lives have been lost and millions of shillings gone up in smoke as buildings come tumbling down. The most recent occurrence was the collapse of the four-storied Mirembe Shopping Arcade located on Plot 5A, Nasser Road.
Although investigations to the cause of the accident are ongoing, preliminary reports have pointed at the excavation work that was being conducted at an adjacent construction site, which forced the foundation to give way. Four people have died and over 20 critically injured.
Anatoli Kamugisha, the chairman of the Uganda Property Developers Association (UPDA), said that it is likely that banking institutions, which fork out most of the finances for construction work will be more critical when making decisions on which project to fund.
“These officials will be risk aversive when analysing applications from developers. Interest rates on such loans may go up in the long run, as banks move to accommodate the additional risks,†he said in an interview over the weekend.
He said that although the majority of buildings in Kampala lack insurance cover, those that have should brace themselves for a rise in premium in the face of increased incidents of fire and collapse.
It is on record that most construction works in and around Kampala, especially of shopping malls, is being funded by commercial banks, who retain the land titles of those sites as security in exchange for long term loans.
The hurried construction work on shopping malls has been blamed on banking institutions that do not give a grace period on such loans.
“Developers are always in a hurry to start servicing their loans. So as soon as they are done with the lower floors, they put them up for occupancy, as they continue to finish the top floors,†said Andrew Mukasa, a city architect.
Patrick Kabonero, Housing Finance Bank’s executive director for development finance, blamed laxity in enforcement of construction regulations.
Kabonero said that the recent collapse of buildings will affect the real estate sector positively. “People are now waking up to the reality that shoddy work begets disaster. Institutions which have not been observing rules and regulations and enforcement bodies such as KCC have already banned construction on some sites because of lack of minimum safety standards,†he said.
On the likelihood that banks may put in place more stringent measures on loans to real estate developers, he said such a decision could depend on managers and may vary from bank to bank.
“For us if one has approved plans from KCC or any other local or urban authority, and fulfills all our other requirements, we go ahead and approve their loan application,†he said.
On the effect these incidents would have on individual tenants especially in commercial buildings, Kamugisha said people would start fearing getting rental space in tall buildings.
The real estate sector, which has experienced one of the fastest growth rates in the economy, will also be adversely affected. This is because most of the buyers of their plots and completed houses are Ugandans living and working in the diaspora.
They do most of their purchases on the internet, and would certainly be hit by the unfortunate news in the country’s construction sector. Kamugisha blamed the accidents on fake engineers and architects, as well as KCC, which does not conduct site inspection.
“In the case of Mirembe Arcade, the engineer would have taken into consideration the horizontal and vertical forces around the building. He would not have gone further than the foundation of the neighboring buildings. An allowance of four meters on the side of each neighboring building would have been left. The foundation would not have gone deeper than three meters,†he said.
He said beginning next year, UPDA will start issuing operational permits to all building constructors, without which constructors will not be able to operate.
Joseph Magandazi Yiga, the managing director of Jomayi Property Consultants, downplayed the incidents, saying most critics are ignorant of the dynamics of the construction industry.
“In the case of the NSSF Towers on Lumumba Avenue, it was the retention wall which collapsed and not the main structure,†he said. Seven people died and work has since been suspended awaiting the outcome of the investigations.
The increasing number of collapsing buildings also raises the question of whether professional bodies such as the Allied Builders’ Union, Architects’ Board, UPDA, and the ministries of works and that of Labour are fully exercising their supervisory roles.
Nick Twinamasiko, a Kampala civil engineer blamed construction disasters on the poor reading culture, which has been exacerbated by an educational culture that promotes the fallacy that the end of knowledge is to pass examinations and get a certificate, and a recruitment culture that emphasises certificates.
Ivan Sekyewa, a valuation surveyor blames the developers unwillingness to pay professional fees to qualified engineers, architects and contractors in preference to quark ones.
Most professionals blamed KCC saying it “violates its own rules and regulations.†Apart from the fact that it has to issue a periodic certificate upon completion of each stage of construction of any building in its jurisdiction, they are also charged with issuing an occupation permit which allows people to occupy every new building and utilise it.
KCC is also blamed for substandard and badly planned buildings because of bureaucracy, lack of manpower and corruption. Muwonge Kewaza, the deputy Town Clerk attributes their inefficiency to powerful interests that “interfere with council’s work.â€
KCC recently placed an indefinite ban on construction works for huge housing projects which manifest poor workmanship and are supervised by quack professionals.
Construction projects that have been affected by the ban include Coil Industries building in Industrial Area, Makerere College’s upcoming structure, Rafik Trading Company building on Wilson Road as well as estates of Industrial Steel Masters [U] Ltd. Others include Rohana Community constructions on Plot 46-49 in Kawempe and Kamwokya and John Bosco Muwonge’s housing project on Plot 33, Nakivubo Road, said Simon Muhumuza, KCC’s publicist.
KCC has also introduced new rules, requiring developers to possess an Environmental Impact Assessment [EIA] certificate, outlining the earthworks to be undertaken and its environmental compatibility as well as provisions for treatment and discharge of on-site waste.
“There also has to be a signboard at the site to detail ongoing construction work and particulars of architects and civil engineers supervising the works,†said Peter Katebalirwe, the chief city planner.
Over the last five years, construction has been the fastest growing sector and it can be expected that a slowdown in construction will have a knock on effect on the general economy.
The Budget figures for the financial year 2007/08 indicate that construction industry grew by 10.0% in 2003/04, 14.9% in 2004/05, 23.2% in 2005/06, 14.3% in 2006/07 and 6.0% in 2007/08.