Reaping big from construction and real estate

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By Special Correspondent

Kulmiye and Docol companies are leading the pack in the reconstruction of Somalia in real estate and road construction making them two of the most sought after firms in the sector.

To get a spectacular view of Mogadishu, The Somalia Investor Magazine team is led to the 10th floor of Shebelle Towers, which although is still under construction will be completed in the next few months. Leading the way is Yusuf Hussien Ahmed, who is the director of Docol Construction and Trading Company, an engineering construction company incorporated in 2007.

Ahmed is to take us to various sites to witness the work Docol and a sister company, Kulmiye General Services Limited, are doing in road construction and real estate. We also get an inclusive interview with him and Kulmiye’s Managing Director and founder, Abdukadri Abukar.

Atop the Shebelle Towers, Ahmed explains that the 10 storey building will be a residential place with a gymnasium and a sauna, a first in Mogadishu. Docol has been contracted by Shabelle Properties Ltd to construct the building at an estimated cost of USD 1.9m.

“My biggest joy is the fact that we have employed over 30 young people as casual labourers with some coming from the neighbouring countries.” he says. In total, both companies employ about 300 young people but the numbers increase depending on the projects being undertaken.

“We have successfully procured long-term contractual agreements with major UN Organisations and other Non-Government Organisations operating within the horn and East Africa such as the World Food Programme and Turkish Red Crescent among others since year 2011,” Yusuf Hussien Ahmed, Docol Construction and Trading Company director.

Both companies boast of having done high profile projects in Somalia to become two of the most sought out in road construction and real estate.

Kulmiye, which was started in 1982 but picked up momentum in 2005 with the construction of 3-bedroom houses is a property management, security, construction, civil engineering, and general logistics company.

“We are a low-cost building and construction company with diverse clientele,” says Omar. Their clients include; UN bodies and Turkish organisations operating in Somalia, banks, embassies, airlines, hotels, restaurant, leading developers, government and private owners.

The company, with an annual turnover of USD30 million and first in the industry to get International Organisation for Standardisation certification in Somalia also offers shipping and transport services in Somalia, Kenya, United Arab Emirates and Greece.

On the face of it, Kulmiye and Docol look like competing interests but the directors say they have found a working formula since they started cooperating in 2007.

“The companies are independent, but we have found a way of sharing skills and expertise. This cooperation has endeared clients to our work,” says Ahmed adding that Docol has a more international outlook.

“We have successfully procured long-term contractual agreements with major UN Organisations and other Non-Government Organisations operating within the horn and East Africa such as the World Food Programme and Turkish Red Crescent among others since year 2011,” he says.

Some of their hallmarks in Mogadishu are new roads and repaired ones. Their big break in the sector came when they were picked as the local partner by a Turkish construction company tasked to do a 23km road in 2013.

“Then, our staff had limited experience and they did not even know how to operate the excavators. Luckily, they picked skills from our Turkish partners fast and by the time the road was completed, our staff gained skills,” he says adding that whenever necessary, they hire foreign experts and train their staff.

Since 2014, the companies have done over 20km of road, work done in different parts of Mogadishu. One such road is a 14km stretch in the heart of the city, an initiative they started and later mobilised other investors and the city’s mayor to contribute to.

Omar says that since roads are key in the reconstruction of Somalia, business owners have agreed to taxation and making contributions towards rehabilitation and construction in some instances.

Kulmiye has also built a hospital valued at USD 17 million in Mogadishu and some of the work was sub-contracted to spread opportunity and skills. Omar says they sub-contract mainly transport to also reduce hostilities among different groups.

From the Shebelle Towers, we head to another site where Kulmiye has contracted Docol to put up what will be the biggest cement silo, strategically located a few minutes away from the ship dock at the port of Mogadishu at a cost of USD 1.6m

“Here, cement will be imported, packaged and sold. We are hoping to reduce the cost of construction material, which most contractors import themselves,” he says.

Kulmiye also has a stone crushing site and boasts as the first local construction company to make concrete.

“We have invested heavily in the state of the art equipment in all our sites,” says Ahmed as he leads us to a computerised mixer, where a young man is busy at work.

Kulmiye is also looking to invest more in real estate as housing demand rises occasioned by Somalis returning from diaspora.

The other hurdle facing the construction sector is lack of a government policy, something he says has kept big foreign investors away.

“The government needs to create trust in international financiers because at the moment, it is hard to find local partners with requisite financial muscle,” he says.

On his part, Ahmed wishes more productivity among locals. “People spend too much time discussing politics at the expense of development,” he says.