Tom Ombasa Soigwa
Solving social problems with business solutions
Tom Ombasa Soigwa, a property developer who owns holiday rental properties in the Kenyan coastal resort of Kilifi, 60km north of Mombasa, was one day urged by members of the local community to have a look at the student accommodation in the town. He was appalled by the squalid conditions he found the students living in. Many of the rooms were make-shift additions to private houses, without basic washing facilities, and some were crammed with up to six beds. “I was moved,” says Tom.
“I remembered my days when I was on campus – our living conditions were so much better.”
But he also saw a clear business opportunity. “I am a social entrepreneur. This means I identify social issues and then look for solutions to solve these issues from a business perspective,” says Tom, who immediately launched a plan to build student apartments for girls.
Kenya’s tertiary education sector has been booming for several years, but student accommodation has failed to keep up, also for the students at Kilifi’s growing Pwani University, with a student population of 7 500 students annually but has only 600 rooms available on campus. The problem is especially acute for female students, who are sometimes forced into compromising situations like having to move in with “sponsors”, older men who exploit their vulnerability.
Tom worked in senior management in the corporate sector and public service until two years ago when he went into business full-time, but throughout his career he has been building a property portfolio in Kitengela, Nairobi, Mombasa and Kilifi.
After seeing the burning need for student accommodation, Tom conceptualised a complex of modern, comfortable, and affordable living units, complete with a cafeteria, Wi-Fi, free transport to and from the campus, and a backup solar lighting system.
The first problem he ran into was buying suitable land to house the Student Hostel. Although lots of land was available in Kilifi, it was difficult to verify who the real owner was because the County had not been properly surveyed. “Most landowners don’t have title deeds. I was conned twice while trying to buy land. In one of the incidents, the owner gave me documents that later turned out to be fake,” says Tom.
He pushed through and eventually secured land to build the project. Using some savings and income from his rental properties, Tom started building his five-storey Hostels block, but the escalation of the cost of building materials meant that he ran out of funds when only 60 percent of the first three storeys were completed.
“I have become an ambassador for BPI and have already recommended them to a few people. BPI has come at the right time and is offering real solutions to challenges that business people face.”
Tom set about finding finance to complete the project but found that the banks did not have the appetite for it. The banks “are not friendly to people without a payslip. Once I stopped working, they started asking for my current cash flows, which is what they used to deny me funding,” he says.
Fortunately, a friend knew about Business Partners International (BPI) Kenya, who specialises in financing the very people that banks were trying to avoid – those who have viable business plans and entrepreneurial drive rather than payslips.
Tom says BPI turned out to be his “guardian angel”. The BPI team looks at the business and the entrepreneur holistically, including the potential for future income rather than past income only. “They are genuinely interested in the business and are keen to see your business succeed. They are proactive and are always providing solutions to my challenges,” he says.
The finance from BPI was used to finish the first three storeys of the building, which is now only two months away from completion. The first students are expected to move in sometime in August 2021.
Tom says the rooms are priced to make them affordable, while ensuring that the project is profitable. Once he has proven the concept, Tom plans to build more student hostels elsewhere in Kenya. “The fact that BPI is on board has propelled me to think bigger.