We speak to Dele Ijaiya-Oladipo, managing partner of Tempohousing Nigeria. The company specialises in providing flexible and affordable residential and commercial spaces using standard shipping containers. Private equity firm Àrgentil Capital Partners recently make an additional debt and equity investment in Tempohousing Nigeria.
– Affordable housing for Nigeria’s rapidly-growing population
How did you start the business?
Tempohousing Nigeria was started through a collaboration with Tempohousing in the Netherlands, which is a pioneer in creating buildings out of shipping containers. We convert shipping containers into habitable spaces.
I studied real estate economics and corporate finance for my master’s degree at the London School of Economics. Following my banking career, I was passively looking for real estate opportunities and luckily at the same time Tempohousing in the Netherlands was looking for partners. So my partners and I went to Amsterdam and we pitched to them and were able to secure what was initially a franchise for Nigeria. Over the years we have refined the model based on what the Nigerian market demanded and by using more locally available materials.
Our aim is to provide good quality buildings that are at least 20% cheaper and three to five times quicker to construct than conventional buildings. We have typically played in the commercial and residential market, mostly as a contractor, but recently we have started to do our own property developments, which is an exciting space for us. Our first development was our headquarters, which houses several serviced offices, and we recently also built a block of 10 flats being used as short lets in a residential area.
We fabricate an average of 70 to 100 containers a year. We sell single containers as well as multiple units used as building blocks for full buildings. For example, you can have a building that is built from 10 containers.
Who are your main competitors?
As a construction company, we are competing against other conventional construction companies. But in terms of pure container buildings, we are the market leader. Other construction companies have maybe done one or two projects using containers.
Due to Nigeria’s fast-growing population and stunted housing supply, the demand for affordable housing increases annually. The deficit cannot be covered by one company and it would need a lot of government intervention. Over the next three years we hope to establish ourselves as a credible alternative to conventional buildings.
Tell us about one of the toughest situations you’ve found yourself in as a business owner?
We had a project we were working on in 2018 that due to negligence by a subcontractor caught fire. The project was already about 75% completed. During that incident, our business could have essentially crumbled. The client in question wanted a full refund. We were in the middle of a fundraising drive, which made it even more challenging.
With the help of partners and investors we were able to survive. There were also a lot of lessons learnt through the process and we put various measures in place to ensure it doesn’t happen again. We had to retrain our staff and subcontractors on fire safety. We now have a dedicated health and safety officer and have reviewed our insurance policies to limit the financial impact of such incidents on our company.
What has been your smartest decision to grow the company so far?
Becoming a property developer. We partnered with an investor for our first development, and used the project to raise funds for additional developments.