Benjam Vetterli, Head of Rockstone Ethiopia
Rockstone Ethiopia is the Ethiopian chapter of Rockstone Real Estate, which is based in Germany. The international developer has embarked on a high-end housing project near the signal area on the road that leads from Kazanchis to Megenagna. The project is on its way to becoming the first certified green building in the country. The Reporter’s Tewedaj Sintayehu spoke to Head of Rockstone Ethiopia, Benjam Vetterli. The half Ethiopian, half Swiss head spoke on Ethiopia’s rich heritage in construction, the prospects of the real estate industry, the pending green certificate and other issues.
The Reporter: Give us a highlight of Rockstone Real Estate. What have you done throughout the world?
Benjam Vetterli: Rockstone is a German developer with offices in Hamburg, Munich, Berlin and Frankfurt. In Europe, Rockstone focuses on residential and commercial projects. They have completed USD 500 million worth of projects with another USD 560 million in the pipeline. Rockstone is developing a residential high end building overlooking the Atlantic Ocean in Portugal. We are also building in Spain. So you have a group that is growing all over Europe. We actually built a hotel in Cambodia as well that gave us a sense of being a bit more adventurous. That is why they ended up coming to Addis Ababa. The CEO and founder, Dietrich E. Rogge, met his partner stationed in Kenya here in Addis Ababa. They also met the manager of SGI group that operates a number of business in Ethiopia and thus began Rockstone’s venture into Ethiopia and its partnership with SGI. The partners then found a local partner in Bigar Builders and Developers.
The Reporter: What reasons contributed to Rockstone’s decision to make Ethiopia its first destination in Africa?
Benjam Vetterli: When the managers met in Addis, they had a discussion about the future of Ethiopia. Ethiopia has been an international hub for over 20 years now. It is the seat of the African Union, the UN and so many embassies. I heard that the German development organization, GIZ, has the biggest office worldwide in Addis Ababa. There is also Ethiopian Airlines that kept flying from Geneva to Addis even during the height of the Covid-19 pandemic. Other flights stopped but Ethiopian Airlines always had one or two flights. That underlines the fact that Addis is an international city.
The market is also another factor. You have a very huge international community here. There is also readiness of the local people to exchange with the international community. Such things might make it difficult to enter a market. But here in Ethiopia, in Bigar we have found real estate developers who are easy in work with. We have found here an international community, a market which is growing, and a country that has an incredible potential. Don’t forget, we are 110 million people; but in 10, 15 years, that could be 150, maybe even 200. This also underlines the potential of Ethiopia. Ethiopia’s location also played a key role as it stands between Asia, Europe and Africa. This is also very interesting. You can also replace Dubai theoretically, right?
Then you find key partners because your partners are the most important aspect of the project. If you want to build a house, trust is the most important thing. And we found a very strong partner and investor which has US dollars to fund, but also the experience of Ethiopia – 16 years. There are not many foreign investors that have this experience. Another point is that we have found a local developer, which just recently completed the Moyale border crossing, which was also a very important project.
The Reporter: So, how do you assess the level of design and construction in Ethiopia?
I’m thinking of two things. The first is the past and I had the privilege of traveling across Ethiopia. I went to Bahirdar and Gondar that have incredible castles. Everybody knows about Lalibella but the construction in the stones at Geralta is also wonderful. And then you go to places like Harar where you have the Rainbow Museum and the Jugel wall. Then I went also to Arba Minch, where the nature is very beautiful. The thinking and engineering that goes into making houses in the Omo valley is also interesting. That gives us a chance to reflect these Ethiopian values in our building.
And then if you look also closer to the present, you go to places like the National Palace. But I think for me, one of my favorite buildings is the one close to the headquarters of Awash bank. There’s this hotel which looks quite a bit like ours. And I really, really like it.
The reporter: So, what critics do you have against the real estate sector in the country?
I’m a bit saddened by the quality. That’s the problem. It’s challenging to access foreign currency for instance; but planning is one of things that we can readily improve. Planning is the very start of everything and we also see it with our business partner. We tell them we need to plan. Planning allows you to make mistakes but at the end, you will have a better output.
The price is higher for the quality you get. Quality is not about what material you use but rather about the way you install it. For instance, a simple thing such as where you put the window, where you put your bathroom, whether the bathroom has a window determines quality. Ventilation is, for instance, a key concept but it is not give the proper emphasis in Ethiopia. What we have in Ethiopia is a kind of blessing from a weather perspective. We have, for instance, considered the weather condition when designing the building.
Another problem is being on time. We have put in a clause in our contract that would require us to pay a penalty for a delay in handing buyers their houses. So, stick to what you have promised. Either be on time or pay a penalty because you didn’t deliver what you promised. To ensure such clauses, we use European standards because it’s just normal to Rockstone standards.
We have a high-end project. Therefore, our price compares with our direct competitors and I’m thinking about two. Those are the Lagar and the metropolitan project. We charge USD 2500 per square meter depending on size.
The Reporter: Your project is tipped to become the first certified green building in Ethiopia. What makes the building green? Is it just the plans or is there something more?
The plants are one aspect. The plants around the building are temperature regulators. When it’s cold It isolates and when it’s hot, it sweats. But more importantly, there are several initiatives I mentioned before such as natural ventilation and also having the sun to come into the house. So, the sun enables you to heat less. Then we have a borehole, first of all, which is drilled 250 meters into the ground. You can find water around 70 meters. We could have stopped there but we went to 250 meters for the sole reason that if you go that deep, the water reservoir will naturally regenerate and you will consume little in comparison with what comes in because natural water is being filtered through the soil and the rocks. The deeper you go, the bigger the water reservoir. We also have two other things related to water specifically. We have a sewage treatment plant. So, the water you consume and that is dirty will be treated and used to irrigate our plants at one point to put the remaining water into the municipality network. It’s clean water, not drinkable, but clean water. We won’t use electric energy to water plants. We also treat water from the borehole to increase the quality of drinkable water.
The Reporter: What aspect of the building is inspired by Ethiopia’s heritage?
We had this local architecture company or developer, but also this Kenyan Spanish architect. And how did he start the entire design process? He started with visiting Ethiopia. He went to places he had never been to before. He came to Ethiopia to do two trips before designing the building. He went to Lalibela and Gondar to understand where we are coming from. But most importantly, if you look at the facade, it draws on the textile heritage. We have our own clothes, traditional clothes, our blankets. It is supposed to reflect the weaving heritage. At the bottom of the building, you can see the traditional designs on the clothes. The color at the bottom mimics those of Lalibela church.
The reporter: Do you plan on engaging in other projects in Ethiopia? This is a high end project. Do you have plans to address the middle class?
What we are hoping with this first project is to increase the quality and hopefully, there will be a domino effect for the entire market. And we are also looking about social housing. How we can have something cost efficient, but not sacrificing quality once again. That would be, for instance, taking such a building and removing the complexity. We don’t need a wooden floor everywhere. We can have porcelain, etc; Simple but well placed. Again, it’s not the material that you put in, it’s how you put it. It is how you have planned and how vigorously you have monitored. It needs to match exactly with what we have planned. We cannot be relative. It needs to be precise and this precision can be replicated on middle class or social housing. I also think about engaging in project housing – on industrial parks, for instance. This is also a big challenge we have going forward here in Ethiopia and it needs to be addressed.
The reporter: So what are your views of the Ethiopian real estate market in the coming, say, 5-10 years?
It’s simple. We need homes. We need homes for people, but we need to build it. We need to find a way to build and an alternative, as I mentioned, that reduces complexity. So, we need to rely on local manufacturers. When you do a kitchen cabinet or the wood work for your floor, you don’t need to import it. We can do it here, but it will require you to do a lot of monitoring on the quality. That would also need a lot of training. But again, you cannot solve in a year; it has to be a gradual process.
The reporter: What stage of construction is the building currently under and have people started to register?
We started construction in April, now we have finished foundation, we have finished basement and we are on the first floor G plus one. And we will have 21 floors. And that’s where we stand. And we are advancing at a rate of two floors per month. When we do to the first floor, we do the walls, the electricity, cabling, etc. to conserve time and budget. Work in parallel in great but it requires a lot of planning, a lot of coordination. Over the last six months, we have been marketing. Now, we are starting to sell to people gently.
