The Road to Africa:
Tony Ciochetti Introduces the 1K House and the MIT/CRE to Kenya
By Jim H. Smith
Posted May 18, 2010
Dr. Laila Macharia was invited to New York last December as an expert panelist at the New York Stock Exchange's Knowledge@Wharton conference on real estate. She came to the conference with exceptional credentials (read bio below). As head of Scion Real, a successful Nairobi-based advisory and investment firm, and also founder of the Kenya Private Developers Association, Macharia was educated in the United States and worked in the U.S. for several years before returning to Kenya, her homeland.
An idealist with a pragmatist's understanding of the world, she sees great potential in Kenya and the surrounding region. "With more than 120 million people, East Africa boasts one of the largest single-bloc regional markets in Africa," she has written. "With the private sector finally unleashed, our region is transforming from an agricultural into a service economy, with telecommunications, finance, transport and business services at the forefront."
That transformation is reason for optimism. But Macharia's optimism is tempered by the fact that 40 percent of Kenya's population is currently unemployed, and stranded below the poverty line. Still, she has a bold vision for fueling the economy of Kenya by improving the lives of thousands -- possibly millions -- of her nation's poorest people.
That's why she made a side trip to Cambridge last year after the Knowledge@Wharton conference -- to meet with MIT/CRE Chairman Tony Ciochetti. She wanted Ciochetti to help her figure out how to build affordable homes for the poor people of her country.
"Exactly the Kind of Challenge"
When Macharia came to the United States last year, she was planning a symposium, in Nairobi, on low-income housing. Developed in collaboration with Housing Finance -- a leading mortgage provider -- and departments of two prominent Kenyan universities -- the Business School at Strathmore University and the University of Nairobi's Department of Architecture -- the symposium was scheduled for late February. Researching speakers for the conference, she learned about Ciochetti because both are alumni of the University of Oregon. Macharia was especially interested in the 1K House project.
Ciochetti has been working to expand MIT/CRE's influence on the planet's real estate community since 2004, and Macharia's invitation was more than intriguing. "For the past six years, we've been developing opportunities for the Center to play a greater role in shaping the built environment of the world," says Ciochetti. "Toward that end I've traveled repeatedly to Europe, the Middle East, India and China, establishing relationships with leading educational institutions and prominent real estate professionals. And we've run short courses so that we can expand our students' horizons with respects to what is happening in many of the markets outside of the U.S. This outreach effort has created both powerful learning experiences and employment opportunities for students. It has helped us market the program to potential students and secure new corporate partners for MIT/CRE. These efforts have also generated research opportunities."
The 1K House project is a perfect example. A direct consequence of Ciochetti's global exploration, it began with an idea he had while traveling through rural India in 2008. "I was driving through the outskirts of Delhi, and I saw some shelters near the road," Ciochetti recalls. He found himself thinking about the MIT Media Lab's famed research project that seeks to develop a $100 laptop computer -- a device with the potential to inexpensively educate millions of children who currently have no access to electronic media. "I asked myself, 'What if we could build houses for $1,000?'"
Back in Cambridge, he told Yung Ho Chang, head of MIT's Department of Architecture, about his epiphany. Chang embraced the concept enthusiastically and helped Ciochetti develop a 1K House Project design studio with the goal of developing prototypes in China, the Philippines, and at MIT.
"I thought Tony's idea was excellent," says Chang, "exactly the kind of challenge we should be tackling." He wanted to design houses that could be built for $1,000 while maintaining high standards of livability and sustainability. "The greater challenge was to create a model that could be constructed anywhere, taking into consideration the unique context of the place where it was being built."
The concept was immediately appealing to Skanska, one of the world's largest international construction and project development companies. It has provided support for the 1K House project along with Next Phase Studios, a large full-service architectural firm. "Skanska has a strong focus on environmentally responsible and ethical practices," says Sarah Bush, a construction manager at Skanska's Boston office. "When Tony told me about his experience in India and the concept of the 1K house, I liked it right away." Bush has conducted reviews of the participating students' designs, and while she was impressed with the designs, she is quick to note that if 1K is going to become a widely deployable model, the designs must be able to adapt to many different environments and conditions, economizing on the local costs of both materials and labor.
It's a critique with which Ciochetti is wholly in synch. The cost of building materials and land can vary significantly from nation to nation -- and even within regions of a nation. Different climates call for different construction standards. And then there are issues related to local regulations, economies, and construction skill sets.
"These were contingencies that made designing a 1K House a much more valuable education experience," says Laura Rushfeldt, one of the graduate students who participated in the studio, and now an architect with Moshe Safi & Associates in Somerville, Massachusetts. "Professor Ciochetti challenged us to think past simply designing a 1K house that could be built here," says Rushfeldt. "The idea was to think about how the house could be built and deployed in other climates, far away, and how scaleable production could become an added benefit of the 1K concept, enhancing local economies, and employing local residents."
"Do Well and Do Good"
The promise of 1K found a receptive audience with Laila Macharia, who believes that finding ways to empower impoverished people -- giving them a stake in regional revitalization and the tools to build a future -- is essential for her country. "The housing shortage is a very big problem in Kenya," she says. "Demand chronically outstrips supply, and building costs are very high. For many Kenyans, a house is simply unaffordable."
"That's why many of us are very interested in ways to bring the cost of housing down. Low- income housing can be very lucrative. Developers can do well and do good at the same time. I wanted to talk with Tony about the 1K project, hoping he would come to Kenya and participate in our symposium."
Ciochetti, whose explorations of real estate markets abroad had not yet taken him to Africa, welcomed her visit to his offices at MIT/CRE. "I was intrigued by her request," he says. "I thought it was an excellent opportunity to present not only the 1K project, but MIT and the Center to a receptive audience in an interesting and important market." In fact, at the February program Ciochetti found himself addressing an audience of nearly 100 people, including representatives of the two universities, Kenya's Ministries of Housing, Local Government and Metropolitan Development, and United Nations Habitat, as well as prominent local developers, slum housing cooperatives, building industry associations, and mortgage providers.
"The notion of low-income housing was a powerful catalyst to bring together all of these people -- academics, business leaders, and policymakers," says Ciochetti. "It was the ideal audience for a presentation about the 1K initiative, and they were a very receptive audience."
"Tony's presentation was excellent," says Vincent Ochieng, head of Ahead Architects, a prominent Nairobi architectural firm, who moderated the panel on which Ciochetti participated. "We are very interested in the 1K idea and how we can adapt it here. We hope that with Tony's help a prototype can be developed that will begin to solve Kenya's need for affordable housing."
In fact, since February, Macharia and Ciochetti have had an ongoing discussion about how to take the 1K project to the next level in Kenya, starting with a studio conducted in Nairobi. It would engage a broad base of MIT students from various disciplines as well as students from the University of Nairobi's Department of Architecture in a collaborative effort to design a 1K house that would meet Kenya's needs.
"What the industry is seeking is the ingenuity of an interdisciplinary team to examine what is preventing us from delivering a formal housing unit that is affordable for most people," says Macharia.
"Affordable housing is a global issue," notes Ciochetti. "That's the inspiration behind the 1K project. I'm convinced that the 1K concept will grow and evolve to the extent that more people know about it and become engaged in solving real needs locally. That's why I was so excited about this opportunity to visit Kenya. It was a great way to get exposure for the 1K idea in a place where there are profound needs that could benefit by this initiative. It also provides another important connection for the school and the Center to get involved in a very important part of the world."
Laila Macharia:
A Commitment to Transform Kenya
After earning a BA in planning from the University of Oregon and several law degrees, including a doctorate from Stanford, Laila Macharia spent several years as a corporate associate in the New York office of Clifford Chance, one of the world's largest law firms. Consequently, she maintains practice privileges in New York and Maryland.
A social entrepreneur, she served as program officer for the San Francisco-based Global Fund for Women, an international network that promotes equality and social justice by funding women's groups worldwide. In Kenya, her homeland, where she is also licensed to practice law, Macharia helped found and is chairman of the Kenya Private Developers Association. It's an alliance of progressive private developers working to make Kenya's building industry more economical, ethical, and environmentally sustainable.
They are the same values that inform Macharia's work as an educator – she teaches executive education at Nairobi's Strathmore Business School – and the column she regularly writes for Kenya's Business Daily newspaper.
Scion Real, the successful Nairobi-based advisory and investment firm of which she is principal, seeks "to catalyze capital into urban property and infrastructure and by doing so, spur economic development while building wealth for our clients and partners," she says. "We work to unlock value in African's urban property markets by identifying, financing and facilitating property and infrastructure projects. We advise regulators and policy-makers to stabilize and strengthen urban property and infrastructure markets. And we help the building industry deliver projects more efficiently, ethically and economically."
