Society diversifies from agribusiness into low-cost housing

Nairobi based E-Farm Housing Co-operative Society has announced plans to diversify from agribusiness to focus on real estate starting January 2017.

The society, whose ongoing agribusiness projects include chicken rearing, horticulture and greenhouses, plans to kick off the diversification with a Sh200 million real estate project located in Konza along Mombasa Road, Juja, Nanyuki and in Kamulu on the outskirts of Nairobi.

Wallace Mwaura, the society’s chairman, said the project to be completed in two years will be funded through members’ contributions with extra funding from local commercial banks.

Mr Mwaura told Enterprise that the society’s shift to real estate was necessitated by increased need for affordable housing by the society’s 5,000 members and the need to boost revenue.

‘’The shift is expected to play a key role in our growth plan with proceeds going to fund our future projects and in the process reduce over-reliance on local borrowing to fund our projects,’’ he said.

The co-operative society has inked an outsourcing partnership with Perfect Pick Limited which will now handle its agribusiness arm.

This, Mr Mwaura said, will enable E-Farm to effectively handle the new housing project, which will see construction of 5,000 low cost units.

A one-bedroom unit will retail at Sh1 million, which will be inclusive of land and set up costs.

Most co-operative societies are shifting focus from agribusiness to real estate as they seek to tap into the construction boom.

The move is mostly driven by growing demand from members to own property. With desire to own property, middle and low income earners are finding societies an attractive option thereby intensifying competition in the sector.

The societies are now acquiring land and acting as property agents, developing the property and engaging in other value-addition services such as road works and building commercial centres.

Some of the co-operative societies that have diversified into real estate include Thika-based Urithi, Kahawa Farmers Co-operative society and Ufanisi Ventures Housing Co-operative.