To achieve sustainable growth in the nation’s real estate sector, stakeholders have listed ways in which the industry could overcome its temporary setbacks.
They noted that the sector is still recovering with a contribution to the national Gross Domestic product staggering between one and two percent.
According to them, the development of a modern mortgage system and appropriate technology in building construction that supports the use of local materials can drive the sector to the path of sustenance.
These were the fulcrum of discussions at the 2019 African Real Estate Conference and Award, themed: “Bridging Investment Gaps in Africa’s Real Estate Markets for Sustainable Growth”, organized by Propertyprop.ng in Lagos.
Discussants at the event include investors, developers, real estate consultants, government agents and manufacturers of real estate products.
Chief Executive Officer of Alpha Mead facilities, Mr. Femi Akintunde, noted the disruptive effect of technology in the sector, stressing that its entrance in the real estate has created the need for the provision of quality data, to arrive at quality decisions.
Akintunde, who was one of the panelists on “Optimising and Restructuring Commercial Real Estate Investments in Africa”, said the challenge posed by lack of national database for the actualization of such information and urged operators and investors to employ artificial intelligence and re-organise their firms to operate within their peculiar environment and attract the right tenants.
According to him, there is a need to ensure maintenance stability by reducing overhead costs, which will ensure a faster construction.
Akintunde also advised players against stretching themselves beyond limits.
“ We need to guarantee our asset value, improve our assets by putting the right policy until the right environment for expansion arises”, he said.
For the Chairman, Eximia Realty, Hakeem Oguniran, there is a need for proper planning right from the designing stage.
Investors, he said, should not overburden their cost all through the value chain but should keep everything lean to ensure return on investment.
Oguniran also urged investors to look go beyond the short term to medium and long-term investments to make headway.
“ You should choose rightly, making a good choice of location will help in getting the right balance between the rent and occupiers because high turn over of tenancy is not good for returns on equity”, he added.
For the Chief Executive officer of Novare Equity Partners, Derick Roger, with its huge population, Nigeria posses huge investment potentials.
He stressed that his firm is making a long-term investment of between five to 10 years in commercial real estate because of the huge potentials in the country.
Also, the Founder of Troloppe Property Services, Leye Taiwo, stressed the importance of a data-driven approach to optimize the potentials in commercial real estate.
According to him, this will lead to understanding the market, the different buildings, occupiers of the buildings, their backgrounds and the total size of the market.
On his part, the chairman of African Real Estate Society (AFRES), Mr. Kunle Awolaja urged the government to improve on the ease of doing business by providing institutional framework for sustainable real estate investment.
The Head of Business Development of Rendeavour, Chinwe Ajene-Sagna, however, stressed the need for diversification of projects to allow flexibility of the projects.
She stated that Rendeavour adopted this approach in its projects to adapt to the harsh operating environment.
Applauding the significant of the event, the state governor, Babajide Sanwo-Olu, said the modern mortgage system, appropriate building, and local materials are critical to the issues of affordability, decent housing, economic growth, and development.
He noted that shelter remains one of the very important needs of man and a critical factor to determines the quality of living, stressing that the focus should be on the development of sustainable urban settlement with adequate infrastructure for a decent living.
The governor represented by the Housing Commissioner, Mr. Moruf Akinderu-Fatai said, in all major cities of the world especially those with challenges of the rising population; provision of affordable shelter and the bridging of the deficit in the housing sector is both a social and economic issue.
The challenge, he said, becomes more pronounced with growing urbanisation as a result of migration of people from rural areas seeking economic opportunities.
According to him, although a number of steps have been taken in the past to develop appropriate and sustainable solutions in partnership with the private sector, what is clear however considering the increasing needs of affordable and decent shelter is that the desired objectives are yet to be met.
The situation at hand, he said, calls for a review of existing policies and strategies with a view to aligning them with current realities and policy objectives.
The governor said bridging the housing deficit is not a responsibility for government to shoulder alone, as the investment required is huge and can only be provided by the private sector.
He noted that the housing sector in Lagos is viable for investment and stressed the state’s willingness to partner with the private sector to meet the housing needs of the state’s growing population, which is in excess of 22 million people.