Hamis Kiggundu sums up Bill banning landlords from charging rent in dollars as unrealistic  – and he has valid arguments  

Hamis Kiggundu. In the background is his Nakivubo Stadium Redevelopment project.

Cabinet on Monday approved the Landlords and Tenants Bill which could be enacted into law if passed by Parliament. According to Housing Minister Chris Baryomusi, under the proposed law, government will ban landlords from charging rent in foreign currency unless the landlord and tenant agree to do so without any duress.

One of Kampala’s landlords, young tycoon Hamis Kiggundu has weighed in on the bill saying it is not possible from a realistic reasonable perspective.

“The economy has determinant factors like demand and supply. Different plots of land have different prices. The amount of money you buy a plot of land, the cost of construction and the loans you acquire to sink into the project are what determine its value,” Kiggundu said.

“It is wrong for the government to want to control rent, saying that we shouldn’t charge rent in dollars. The moment you become a tenant, you become subjected to the terms and conditions under which I sourced money to put up my structure. For instance, if I acquired my loan in dollars, and the bank wants me to pay back in dollars, definitely you as my tenant have to pay rent in dollars,” Kiggundu said.   

“It’s not that people acquire loans in dollars because they want, our economy is weak. For example, most banks in Uganda have a single borrower’s limit of $10m. If you have a project worth more than that, you have to seek capital elsewhere and expensively. It means the tenant is subjected to the same circumstances,” he said.

“For instance if a person borrows money from a bank and constructs four houses but he must repay the bank Shs4m a month, it is automatic that he must charge a minimum of Shs4m to be able to service the loan. If he is charging Shs500,000 per house and servicing his loan with only Shs2m the bank will automatically take his house,” he opined.

Ham Towers is one of Hamis’ real estate developments.

Kiggundu blamed the Bill on politicking. “In Uganda politics is taking over everything. Ugandans should stop frustrating business by politicking otherwise the economy is going to collapse. Case in point is my Nakivubo Stadium redevelopment project which was stalling because of politics. I spent four years fighting battles in Nakivubo but now you can see the good work I have done,” he said of the $49m project expected to be completed in 2020.  

“In matters of development, politics should be completely struck out. Otherwise the country will not develop. They keep saying we are fighting for the common man (omuntu wawansi). Don’t you want these people’s welfare to develop? Do you enjoy keeping calling them omuntu wawansi? Don’t you want them to develop from working in make shift iron sheet structures to arcades?” he retorted.

“If we want Uganda to develop, we must divorce politics from business. That they will pass the bill to coincide with the new tax regime with the intention of appeasing tenants. I thought even landlords can be tenants elsewhere. Economy has forces like factors of demand and supply.”

Kiggundu added that even if passed, the law would be hard to implement because the determinant factors are economic; like demand and supply. “If they insist on enforcing a law on rent, let them also enforce the prices tenants are selling their things i.e that you must sell this shirt at this amount. It is literally impossible,” he said.

Kiggundu shows his Nakivubo redevelopment project to President Museveni.

How the economy can develop

Kiggundu says the economy has weakened and he weighed in on how we can develop instead of the government trying to appease a few sections of people like tenants yet prices of all commodities are rising.

“The economy has weakened and this has been caused by our lack of a source of income as a country. We spend a lot to import and export very few commodities. Uganda has no money. The only solution to Uganda’s economic problem is to go back to the roots to establish income as a country. We are all in trouble,” he said.

According to him, the solution is agriculture and additional value. “The government should spearhead agricultural programmes. But how will you help farmers? By creating agro processing units. You can create agro based industrialization. Things like ketch-up, cornflakes are being imported. If we manufacture them here, we shall achieve import substitution. Instead of taking the money out, we shall be paying it to our farmers who will in turn have purchasing power. That is how the country will develop,” he said.

“God gave us resources as Uganda; we are gifted with fertile soils and good climate. It means if we focus on agriculture we shall develop. And you cannot force the youth in town to go into agriculture, but if you create demand for agricultural products, all these people will go back to the villages to dig because everyone is looking for income at the end of the day. That way we shall develop individually, and as a country.”

“Besides, we can export some of our products even to the neighbouring countries. If we don’t do this, the economy is going to collapse. The high prices you are seeing of common commodities are just the beginning,” he warned.

He said government should spearhead this, but capable individuals shouldn’t shy away. “However, this needs a lot of capital which Ugandan banks can’t provide. We are forced to go beyond borders to find capital. The cost of these loans is high and return on investment is long term. Government should seek funding for such projects. It is the only way we can succeed.”

Hamis at home.

How come Hamis has succeeded in a bad economy?

Hamis says its true people admire him, but he reveals he is not where he wants to be and he has some advice for those who want to improve their economic status.

“People develop in stages. I also started at a certain level but you need reasonable capital. You can develop but sometimes it is limited by prevailing circumstances. Most Ugandans have a problem of not being realistic. He can consume Shs2m because he doesn’t see it as capital. If you look at Shs1m or Shs2m as capital, you can develop. The determinant factor of capital is the nature of business in which you are going to inject it. If you have Shs2m you need to plan at that level. Some people have Shs2m but their plans are worth billions. It means they will never develop. Ugandans should look at issues from a realistic perspective not presumptions,” he said.