Diamond properties is a Kenyan investment firm which specialises in property development. This is an interview with the managing director Mr John Ngugi.
What is the story behind Diamond Properties Merchants?
After working for many years with Uganda’s Industrial Research Institute as a research assistant, Mr. Gichuge realized that most people face land and home ownership problems. So he decided to set up a business that will help solve that problem.
Later, he realized that land is a scarce resource and with increased demand, it has become unaffordable to many. He started with buying chunks of land and subdividing them into smaller and affordable plots. It was mainly because of this that Diamond Property Merchants was established in 2000, He started off as a real estate agency. We have grown in leaps and bounds to become large scale property company, and top of its game in the region.
Who are the founders and key team members?Mr. Josphat Gichunge is the founder and Chairman of Diamond Properties Merchants, the other key members of our team are as
Mr. Josphat Gichunge is the founder and Chairman of Diamond Properties Merchants, the other key members of our team are as follows;
- JOHN NGUGI- Managing Director
- EDWIN KHIRANGA- Director Sales
- LINNER MULI- Financial Officer
- MAJDA KABUNGE- Human Resource Manager
- JACOB MULATYA- Operations Manager
- ARCH. WILLIS LUVAI- Project Manager
- DENNIS W.- Legal Officer
- EDWARD NG’ANG’A- Business Development Manager
Where are you headquartered?
Diamond Property Merchants is headquartered at ANSH PLAZA, 5TH FLOOR, BIASHARA STREET, NAIROBI, KENYA.
What is unique about the company?
We are a reliable and professional institution, that values honesty, integrity and service delivery.5. What big problem does it solve?Our key focus is providing investors with strategic property investment solutions.
Can you tell me more about the Agribusiness products that you market?
We realized that the ever-rising prices of horticultural products are caused by a shortage of large-scale farmers resulting to a mismatch between demand and supply.
This is why we decided to offer agribusiness and the ultimate value addition to our land buyers. The project is being managed by Nguzo International Limited, a company that is specializing in greenhouse farming. A plot at the project, which is located about 7km from Kajiado town, goes for ksh500,000 and is specifically for agribusiness investors.
It will see investors pocket Sh200,000 every season or Sh400,000 annually as a profit after deduction of production costs. Set-up costs for a single greenhouse (15 by 8 meters) are estimated at ksh 320,000.
The land has already been tilled, borehole water provided with complete plumbing works to every single plot. All that is left is for the buyer to purchase the plot, pay for the greenhouse and become an urban farmer. It is estimated that a single eight by 15m greenhouse can yield an average of 5,000kgs of tomatoes or capsicum. Given a fixed buy-back price of Sh50 per kg, the expected returns per season is Sh200,000 net after deduction of recurrent expenditures. We have partnered with large scale buyers— supermarkets chains and fruit-processing factories — to ensure that there is a steady market for our products throughout the year and that our customers receive their money on time.
— DIAMOND PROPERTY (@dpmerchants) July 15, 2017
How big is the market opportunity?
Agriculture in Kenya is a very integral part of the Kenyan economy. It is arguably almost the only means of livelihood for a large proportion of the Kenyan population and it is estimated that the agricultural sector accounts for 22% of the gross domestic product (GDP). The sector also accounts for more than 50% of Kenya’s total exports and provides more than 16% of formal employment in the private sector. A growth of the national economy is therefore highly correlated with growth and development in agriculture. This figure clearly shows that there’s huge market for our products..
What is the actual addressable market?
As indicated above, our actual markets are supermarkets chains and fruit-processing factories who we supply on large scale. We also export these products to other countries.
Can foreign investors invest with your company?
Absolutely, we are open to all potential investors around the globe.
What are the requirements and restrictions if any?
The requirements for foreign investors are as follow;
- Age Requirements: Must be at least 18 years of age and above.
- Documentation: Requirements A valid Passport
- KRA pin: ( Kenya Revenue Authority Pin) Since international investors do not have a kra pin, we advise them to register companies in Kenya so they are able to get a kra pin.
What ROI can investors expect today and in the future?
Investors are guaranteed a return of Sh200,000 every season or Sh400,000 annually as a profit after deduction of production costs. We hope to make it even better in future.
What is the timeline for receiving the investment/dividends back?
This take between 6-12 months, we have two seasons in a year.
What are the three main advantages for investors?
- Guaranteed returns on investment
- Security on funds invested
- High returns on investment
How are investments secured?
All greenhouses have an insurance cover in the event of crop failure, crop destruction or attack by disease, A client is compensated 75 per cent of the expected income.
What are the guarantees?
We guarantee security and a good return on funds invested to all our investors.
What do you see as the principal risks to the business?
Given the entry into the sector by con men nowadays, one is never sure that you are dealing with the right person. Investors should be extra careful when dealing with land buyers and sellers. Also, the projects require a lot of capital and if you don’t have such money, your business might end up closing. The government should set aside low-interest loans for developers who want to venture into real estate. Finally, bank interests are too high and this hinders potential investors from investing in this sector and since land is in high demand, this encourages more fraudsters.
Are the company accounts public?
The company accounts are not public however, we can make them available on request by our members or potential investors.18. By which jurisdiction is Diamond Property Merchants Regulated?Real estate transactions in Kenya are mainly governed by land laws and the general principles of contract law, whether it is a simple sale contract, a developer’s contract or a lender’s contract.
We thank Mr John Ngugi for the interview.