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The Mall King And His New Toys

Published 8 years ago
By Forbes Africa

From the heart of the Lower Zambezi National Park hundreds of miles from a town or on the streets of Lusaka, the name Mark O’Donnell is as common in Zambia as the Victoria Falls or Mosi Beer. On the streets they call him the Mall Man; the Zambian who made his fortune building places to stay and shop. In business, he is known as a ruthless strategist who wants to make money and cannot make it fast enough.

“Zambia is a small market but it’s a growing one, at six to seven percent a year, for the past 14 years. The economy of the country has grown much bigger. We’ve been fortunate to make investments when the time was appropriate… we just wanted to build a shopping mall,” says O’Donnell.

O’Donnell is a born and bred Zambian and has walked a meandering path to riches.  At 18, O’Donnell was selling auto parts for someone else. But he dreamed of being an entrepreneur. Times were tough in the 1980s, when private money struggled in a socialist state run under tight regulations. Strangely, at a time when there was little to buy, he thought that malls could be just what Zambia needed.

“It was very difficult to do anything in Zambia. Ninety percent of the country was controlled by the state. You would drive around in Lusaka and all you would see were queues of people lining up to buy whatever commodities were in the stores. There were a lot of hardships,” he says.

This hardship led to riots and ushered out the 27 years of power for Zambia’s president Kenneth Kaunda and its policy of control. Frederick Chiluba led his Movement for Multiparty Democracy in the elections in 1991 on a ticket of free enterprise. Despite the freeing of the economy for private business, things got worse for O’Donnell. Private business was shrinking by the day.

“In the 1990s, business was pretty bleak. We were just plain contractors at that point, and we were just trying to find work. It was almost impossible to get regular types of work, so we had to be innovative. We had to figure out how we were going to make projects. So we went and designed our own projects,” he says.

O’Donnell decided to build a mall to keep his business running. Despite his fears, the Arcades Shopping Centre was built in 2003 and brought in a number of South African franchises, putting Zambia on the map for investment.

“Many people wondered why we were building a shopping mall when the market seemed like it was struggling,” he says.

It brought fame to the farthest reaches of the country, even to the far flung bush of the Lower Zambezi National Park. Hundreds of kilometers away, Joshua Chizuwa, who has been a game ranger for more than 40 years, has heard of him.

“I used to work as a construction worker for him during breaks from the bush a long time ago. O’Donnell was as a hard businessman, ruthless in his deals. I have seen his buildings rise and Lusaka has grown from his ventures. He’s changed the face of Lusaka,” says Chizuwa.

According to Trevor Simumba, a Zambian-born managing director of the Sub-Saharan Consulting Group, within Lusaka O’Donnell is regarded as a progressive businessman who saw the liberalization policies of the MMD in the nineties as an opportunity rather than a challenge.

“He was very helpful to me when I was starting my career in the consulting field. At one point during a very difficult career transition, Mark said to me ‘Trevor it is always darkest before dawn’. This simple but profound statement helped me through and I always tell myself that whenever I face a challenge. Zambia is privileged to have Mark doing his business in Zambia. We need more role models like this in business in Zambia,” says Simumba.

O’Donnell also went into the hotel industry. It was a failed game lodge that saw O’Donnell go big. He negotiated a deal with Africa’s largest hotel group, Protea Hotels, a chain that has been targeted by Marriott International.

The first hotel O’Donnell built was in Chingola, in northern Zambia’s rich Copperbelt Province. He says it was a disaster.

“We opened it in the same week that Anglo American pulled out of Zambia. It wasn’t the best start to a hotel chain. There was zero occupancy for a couple of years,” he says.

It has taken 13 years of fighting back to expand seven more hotels. He is currently building his eighth in Lusaka, next door to his mall.

As the largest owner of hotels in Zambia it makes sense that O’Donnell wants tourism to boom. Until recently, he has been critical of the government’s efforts to encourage visitors. Tourism currently accounts for a mere 2% of Zambia’s gross domestic product. In August, the government announced a turnaround strategy to increase this to 7% in line with neighboring Zimbabwe. It has won over O’Donnell.

“You are talking about an industry that needs to double in size over the next five to 10 years. Our current arrivals are about 900,000 a year. If we take out non-tourist visits, we are probably looking at 300,000 tourists. I think what we would like to see that number grow to about 600,000 high spending visitors. We need to increase the visit to arrivals in Zambia. That’s our first priority. To raise Zambia’s profile in the key source markets and increase interest to come into Zambia either through leisure tourism or for business travel. Certainly both components have interest,” says O’Donnell.

Tourism in Zambia is difficult. O’Donnell says a ban on Zambian aircraft by the European Union (EU) has discouraged North Americans and Europeans.

“The agents won’t book internal flights due to insurance reasons. It’s purely to do with some technicalities that the EU won’t deal with, with our civil aviation authorities,” he says.

But his greatest challenge lies with Zambia’s marketing. According to O’Donnell, 60% of wealthy foreigners in North America, Asia and Europe have never heard of Zambia.

“Our customers demand a high quality sort of product. Just because this is Africa it doesn’t mean you can’t offer top class products to the market. Zambia is generally unspoilt, an environment untouched by commercialization. In some places in Africa you would find 20 minibuses around a lion, this doesn’t happen in Zambia. You can’t compare what we have with London and New York, but you have something different,” he says.

In a city that was little more than dirt roads, O’Donnell had a dream that many struggled to envision. Where people queued for hours to get their hands on commodities he saw malls with refrigerators. Today, O’Donnell’s buildings run alongside tarred roads and Zambians are eager to see what his next dream will be.

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Related Topics: #Building, #February 2014, #hotels, #Mark O’Donnell, #Mosi Beer, #Property, #Protea, #Tourism, #Victoria Falls, #Zambezi National Park.