Reporter

Increased oil production grows Nigeria’s GDP by 1.81% in Q3

Nigeria’s Gross Domestic Product (GDP) has grown by 1.81% in the third quarter of 2018.

According to data released by the Nigerian Bureau of Statistics, the growth is an increase of  0.64 % Compared to the third quarter of 2017 and an a growth of 1.50% compared to  the second quarter of 2018.Quarter on quarter, real GDP growth was 9.05%.

In the quarter under review, the NBS says aggregate GDP stood at N33.14 million in nominal terms. This performance is higher when compared to the third quarter of 2017 which recorded a GDP aggregate of N29.03 million thus, presenting a positive year on year nominal growth rate of 13.58%.

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This growth rate is higher relative to growth recorded in the third quarter of 2017 by 2.88% points and higher than the proceeding quarter by 0.01% points with growth rates of 10.70% and 13.57% respectively.

The growth was boosted by increased oil production. Nigeria recorded an average daily oil production of 1.94million barrels per day (mbpd), higher than that of the second quarter of 2018 production volume of 1.84mbpd by 0.10mbpd.

Real growth of the oil sector was –2.91%  in Q3 2018 but growth increased by 1.04% points when compared to Q2 2018 which was –3.95%. Quarter-on-Quarter, the oil sector recorded a growth rate of 19.64% in Q3 2018.

The Oil sector contributed 9.38% to total real GDP in Q3 2018, down from figures recorded in the corresponding period of 2017 and up compared to the preceding quarter, where it contributed 9.84% and 8.55% respectively.

In the  the Agricultural sector: Crop Production, Livestock, Forestry and Fishing. sector grew by 18.32% year-on-year in nominal terms, showing an incline of 5.82% points from the same quarter of 2017. Looking at the preceding quarter’s growth rate of 10.64% there is an incline of 7.67%. Crop Production remains the major driver of the sector.

This is evident as it accounts for 91.1% of the sector’s nominal GDP. In the third quarter of 2018, Agriculture contributed 25.52% to nominal GDP. This figure is higher than the rates recorded for the third quarter of 2017 and higher than the second quarter of 2018 which recorded 24.50% and 18.78% respectively.

Affa Dickson Acho

Ugandan govt urged to reserve $4million worth of civil works for local firms

With foreign firms dominating big building projects in Uganda, domestic contractors have urged the government to reserve road and bridge schemes valued at $4m or less for them.

Francis Karuhanga, president of the National Association of Building and Civil Engineering Contractors (UNABCEC), said such a reservation scheme would help build capacity in domestic firms for infrastructure projects.

“We pray that this is introduced in all government financed projects,” Karuhanga told the organisation’s annual general meeting in Kampala.

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Karuhanga also called on government to introduce a contractor classification and registration scheme to promote transparency and competition in civil works procurement. He said only companies demonstrating profits for the past seven years should be allowed to compete.

Domestic firms face big disadvantages in competing for public civil work, Karuhanga said, including the requirement to furnish bonds and guarantees for construction contracts.

Procuring construction equipment is also very expensive for domestic contractors, he said.

“This has continuously pushed that domestic construction firms out business and instead favours the big international companies that have easy access to equipment through favourable financing and asset leasing terms and lines of credit,” Karuhanga said.

He called for a lower-interest fund, managed by Uganda Development Bank, to assist contractors.

According to New Vision, UNABCEC wants civil works worth up to $4m reserved for domestic firms, and those over $4m and up to $8m open to competition by domestic and foreign contractors.

One flashpoint for Ugandan contractors’ discontent has been a $450m, 51-km expressway from Kampala to Entebbe airport, completed in June this year, part-financed by China and built by Chinese state-owned firm China Communications Construction Co. Ltd..

In July a UNABCEC spokesperson asked why Uganda awards such work to a state-owned Chinese firm, and not to state-assisted Ugandan firms.

Fss2020 to make Nigeria the fastest growing financial system in the world-Suleyman

In 2007, the Central Bank of Nigeria (CBN) launched the Financial System Strategy (FSS2020) aimed at calibrating the financial system as a means of ensuring economic growth and development in order to grow the Nigerian economy to be one of the 20 largest economies in the world by 2020. In this interview, the Executive Director of FSS2020, M.D Suleyman, speaks on the impact of the strategy and what to expect in the coming year.

What is FSS2020 about?

The FSS2020 is an initiative of the CBN and other regulatory institutions in the financial system that was launched in 2008, but its implementation was in 2009. The initiative came about since 2006 as a result of the prediction of Goldman Sac that come 2025 Nigeria is going to be among the net 11 developing nations in the world. So when that happened, the CBN governor felt that we needed to start a project to actualise that prediction to make Nigeria one of the top 20 economies, not by 2025, but by 2020. So that target was set in 2006.

The regulatory institutions in the financial system came together with some critical stakeholder ministries to craft the strategy document, and the vision of that strategy is to make Nigeria the safest and fastest growing financial system in the world by 2020, supporting the real sector, but after a 2013 review, the vision changed to becoming the safest and most diversified financial system among emerging nations supporting the real sector for economic development.

The strategy is to focus on the emerging economies in the Africa and Nigeria itself. So, basically that is what the strategy is about.

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What is the focus of the strategy?

The strategy is anchored on three pillars: to deepen the Nigerian domestic financial market, to integrate the Nigerian financial market and the international market, and then the third pillar is to support real sector in promoting economic growth.

That was how we came about bringing in the Micro, Small and Medium Scale Enterprises (MSMEs) sub-sector into the strategy document so as to support the real sector in our bid to develop and deepen our economy. That’s how the strategy was crafted.

What sectors are you looking at in the implementation?

We are looking at five sectors in the implementation of the strategy: insurance, pension, mortgage, financial market (comprising of the money and capital market) and the MSME sub-sector.

These are the constituents of the strategy document. We are as well working in collaboration with the regulatory agencies and market players in all these sectors to make it happen.

What is the impact of the financial system strategy adopted in the last 10 years?

So far so good, though 2020 is just around the corner, but we have been able to achieve some milestones in some of the sectors, particularly the money market, because our focus in the money market is enhancing the payment system in the country; that’s how we came about innovations in the payment system space.

Today the payment system space in Nigeria is among one of the best in the world to the extent that other countries are coming to learn from us to see how we got to where we are today. You know in pre-2006 we couldn’t transact any business in any branch other than the branch which your account is, but today, even in the comfort of your bedroom, you can do your transactions: bank transfers, pay your bills and you can do so much using other channels of financial services to transact your business. And that I think is a great deal and I will say we have done much in that respect.

And for the capital market, gone are the days when you wait for your dividend warrants or share certificates from entities that you subscribe for their shares. Now with the coming up of the CSCS shares are registered online and people can manage and monitor their shares and their dividends can be paid into their accounts. All these came about from the innovations of the FSS2020 strategy.

Financial inclusion is part of the strategy we are trying to achieve. Just recently, last year December, the Governor of CBN, who is the chairman of the programme’s supervisory board of FSS2020, at an executive retreat in Lagos, gave a marching order that we needed to upscale the inclusiveness of Nigerians into the financial system to 80 per cent by 2020. So we are working with the national financial inclusion strategy secretariat, and to achieve that and to do that in the pension sector to have this micro pension that everybody is talking about, we have come up with an initiative that SMEs that want to patronise government for contracts must come up with certificate of compliance in participating in the pension scheme, at least to have three staff in their companies registered in the pension scheme. And that is working. The next level we want to get to on that is to encourage the banking sector, particularly the CBN, to make it a condition that any SME that wants to access intervention funds from the developmental funds in the CBN, either agric or the SME funds, that the provision of the certificate of compliance should be part of the requirement. That will go further in deepening the involvement of the SMEs in the pension funds thereby achieving the micro pension scheme that we are bringing in. Likewise in the insurance industry, more products are coming in. Before now,

people had this apathy about going into the insurance industry because of either cultural or religious beliefs. But now we are beginning to introduce into the space the non-interest insurance services like the Takaful so that will take care of the large segment of the society that has not been captured in the micro insurance industry.

For the mortgage, a lot of initiatives are coming up on board for the provision of affordable housing at a very reasonable costs. Though we are faced with the challenge of funding, but we are making effort to see how we can pluck from the low hanging fruits of the direct foreign investors who are interested in the housing industry.

So far so good we are talking to about two groups now: the African-Diaspora Chamber of Commerce who are coming in with billions of dollars for that purpose, we are still discussing with them on that in collaboration with the Federal Mortgage Bank, the Nigerian Mortgage Refinancing Company and the Mortgage Bankers Association.

By and large, we have made some good strides in the FSS2020 strategy. There is still work to be done and we are leaving no stone unturned to see to the achievement of our objectives.

With just one year remaining, is there going to be an extension of the strategy?

Usually, no strategy is cast in stone, the beauty is that part of the requirement of the strategy is that you apply some agility and flexibility to it. Where you find out that you are experiencing some issues or challenges; by that agility you can make it suit your purpose, so for that reason, if we are unable to meet our target by 2020; of course we are already embarking on a review of where we were before the strategy and where we are after the implementation of the strategy has commenced, and I think that document will be a referral document for research and records.

By 2020 we intend to do a final review of the progress of the strategy and then we will be able to decide whether we have been able to achieve our objectives or not and whether there will be need for us to extend that date or not.

What should Nigerians expect from FSS2020 in the coming months?

If what we are working on now works out and we get the support of our principals, I think Nigerians should begin to see a complete revolution in the areas of mortgage market development in the country and a lot of infrastructure; both financial and physical infrastructure, coming to the country.

We have succeeded in getting PenCom to agree to the increase of the level of pension funds that would be deployed to infrastructural development. And once that happens, Nigerians would see a lot of activities going on in the issuance of corporate bonds, green bonds, infrastructural development, in the spirit of sustainable banking principles to meet all these climate change challenges where we will start to encourage healthy environment.

So pretty soon we are going to have affordable housing, long-term housing projects and mortgage financial transactions in the country.

We have an initiative of coming up with the Green Smart City development, we have opened conversation on that and all that is in the spirit of climate change. The Green Smart City is going to come on stream, we have written to the Minister of the FCT, we have written to some of the states, because we want to have the pilot run in five states: FCT, Lagos, Kaduna, Enugu and Rivers.

The city is all about climate change, low emission, encourage green environment and reduce environmental pollution. The city will use alternative sources of energy and no generators, and environment where we can have automated surveillance security system for the city.

How land reforms curbed sharp practices in Kogi

The Director General of Kogi State Lands and Housing Services Bureau, Hajiya Maryam Ladi Ibrahim, has said that the digitalisation of land records into the database of the Kogi State Geographic Information System (KOGIS) has helped in curbing sharp practices associated with the state’s land administration.

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Mrs. Ibrahim, in an interview in Lokoja, said KOGIS was established to move Kogi away from the analogue system to a digital/seamless process in land administration and in the process boost the revenue profile of the state.

She said over 200,000 land documents and 36,000 files had so far been profiled, scanned, captured and stored in the data base of KOGIS and that KOGIS would fast-track the process of acquiring Certificate of Occupancy (CofO) to ensure major towns were fully digitised to national standard which would in turn enhance the state’s housing and street naming policy.

Mrs. Ibrahim further said the government had given an opportunity to the people to regularise the legal status and documentation of their property under the “Property Owners Express (POE).”

New guidelines for land acquisition introduced in Bauchi State

The Bauchi Geographic Information Service (BAGIS), an agency of the state Ministry of Lands in the Department of Land Administration, has introduced a new guideline for land acquisition and administration in the state.

The Director General of BAGIS, Baba Abubakar Suleiman Katagum, said the 28-page document titled: “General Land Services Operational Guide Manual”, laid out all procedures for owning and use of land in the state.

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Katagum said, “In BAGIS, we are planning a land registration system, and are campaigning to increase or encourage registration which will also contribute to the alleviation of poverty.”

He said land registration would give the owners guaranteed protected land rights as a source of personal wealth which would provide opportunities for economic independence and that the state government would re-enact the “Land Instruments Registration Law of Bauchi State” which required the registration of land documents with the Ministry of Lands.

He said the new measure would encourage business development as proper registration would provide land proprietors guaranteed titles which could be used as collateral in banks to access loans.

“We have actually produced a simple and easy-to-read registration procedure which will be printed as a booklet that explains all our registration procedure and informs applicants of the requirements for our various processes. The booklet can be obtained free of charge at BAGIS’ Deeds Registry and is a viable method of disseminating information to the public,” he said.

CBN Set To Launch National Microfinance Bank

As part of efforts to enable speedy disbursement of its several intervention funds including the Agribusiness/Small and Medium Enterprises Investment Scheme (AGSMEIS), the Central Bank of Nigeria (CBN) has said it will in collaboration with the Bankers’ Committee and the Nigerian Postal Service (NIPOST) start the operation of a national Micro Finance Bank (MFB) CBN Governor, Mr Godwin Emefiele made this known at the opening ceremony of the 10th annual bankers’ committee retreat in Lagos, saying it will further enhance financial inclusion and credit to fund the agricultural sector and small and medium scale (SME).

Emefiele said the national MFB slated to launch next month would leverage on the existing NIPOST presence in 774 local and aid the CBN and the bankers committee effort in accessing the Anchor borrowers fund, SME fund and other initiatives tailored towards SMEs, farmers and the CBN’s financial inclusion drive. He also said this was to help ensure the success of the N26billion set aside to finance agric businesses and other small informal businesses under the Agribusiness/Small and Medium Enterprises Investment Scheme (AGSMEIS).

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“Today, the central bank has N220 billion that is set aside under the micro small and medium enterprise fund. Nigerians where happy when they heard that the banks, out of their magnanimity, decided that 5percent of their profit would be set aside to support Agric business and SMEs. “We have over N60 billion sitting in the banks currently in CBN and why should that money be sitting in CBN and just be earning Treasury bill rates. It is meant for the micro small and medium enterprises and for the weak in our economy that would not ordinarily have access to knock at your door.‎ “That was why we voted last week at bankers’ dinner, that a national micro finance bank would kick off by January 2019.

In order to collectively address the challenges hindering the achievement of the objective of the AGSMEIS initiative, the CBN is considering the proposal to the establishment of the national microfinance bank which would leverage on the Nigerian postal service presence in 774 local government areas across the country. “We have called on NIPOST and they have agreed to join us in this. They would provide their facilities in 774 local governments and this would be their own contribution by way of equity into the establishment of the national MFB.

We would provide the infrastructure and this MFB would be available in 774 local government across the nation.” He added that it expected that the bankers committee and NIPOST would have representation on the board of this national MFB. “The task and responsibility to improve our rural communities is in our hands and we believe strongly that using this infrastructure of the national Mfb, we would get to achieve the objective of creating jobs and enhance the skills of our people in our rural communities, improve and grow the economy so we can achieve the development that we so badly require in Nigeria today.” Furthermore, on the MFB, he said the proposed MFB would be expected to engage in strategic partnership with NIPOST while the NIRSAL which is owned by the CBN would be expected to bring its experience in financing low income entrepreneurs and de-risking credit originated by the national MFB by providing guarantee in line with its mandate.

On investments towards power, he said:  “In collaboration with the government, the Nigerian Electricity Market Stabilisation Facility was set up to rescue and reset the electricity industry for privatization in 2015. The CBN in line with the proposal establishing the Nigerian Electricity Market Stabilisation Facility invested N213 billion in it.  The aim was to provide refinance for the participating banks and also to ensure that necessary bank guarantees are put in place to back the contracts for the industry. “The Bankers’ committee played the role of first line financiers ensuring that the facility is repaid. Through the facility, the Distribution companies have been able to post LCs in favour of NBET. Other outcomes are the purchase of over 700,000 meters, purchase and installation of 500 transformers,   recovery of  1,000 megawatts and  increase in gas supply commitments. Several contracts were also executed as a result of this intervention,” he said.

Ogunniran calls on government to create platform for affordable housing

HAKEEM OGUNNIRAN is the immediate past Managing Director, UACN Property Development Company (UPDC). He is also the founder/Chief Executive Officer, Eximia Realty Company Limited. In this interview that was published by Guardian,he spoke on the challenges of affordability and social housing in Nigeria as well as the real estate’s potential in boosting the economy.

You are a lawyer but cut your fame in real estate sector, what drives the passion?
People don’t know that I used to teach real estate law in the university. I have a unique understanding of real estate because my foray into academics gave me significant insight into the underpinnings and workings of real estate transactions. I was working in UAC and had the opportunity of moving from what I was doing to UPDC, I grabbed the opportunity with both arms and that gave me a unique platform to manifest what hitherto has been innate in me.

As a former Chief Executive Officer of UACN Property Development Company, the company over the years added rich property investments/portfolios. How were you able to achieve the feat? What are the critical loopholes you noticed in the Nigerian real estate transactions? 
I worked in UAC for 23 years and had varied experiences from legal to sales and marketing, running two significant businesses. UAC is a great company; it gave me opportunity and training. I spent eight years in UPDC and in those years, I had a rare privileges of working at the centre of real estate transactions in Nigeria executing projects, raising funds, selling to customers, creating platforms in the real estate industry.

The sector is challenged; there are significant problems that we grapple with in the industry. People always talk about funding, but for me, funding is not the main problem in the sector. The major problem is the availability and affordability of good titled land. We have instances, where you acquired title to a land and several years after, somebody else comes and then it becomes a problem. For me, uncertainty of title is a major problem.

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Another is the issue of funding at both construction and retail end because of the structure of the economy. At the retail end, there are a little above 20,000 mortgages in Nigeria, the mortgages are unaffordable, the rate is too high, the tenures are too short. Currently, mortgages go as high as 20 or 25per cent. What that means is that in four years, you would have paid for the price of the house twice and it doesn’t make any sense. Infrastructure is also a key problem because a lot of developers today, are like local government. They provide power, road, sewage and water treatment yet; you would pay other charges like neighbourhood charge, land use charges and others.
These issues are serious problems, which affects the growth of the sector. I always take a value chain approach to real estate, look at the critical players and issues that matter to them. The environment is such a risk factor against real estate and it is very difficult.

Talking about planning approval, I was in a conference recently where one of the speakers narrated how he had to wait for 36 months before getting approval for a project, which they completed, in 14months. There are other challenges of inflation, high interest rate, challenges at the ports and all the usual problems of businesses in the country because you can’t isolate real estate from the economy.About 60 million Nigerians are said to be living in indecent homes coupled with wide housing gap. The country hasn’t been able to meet the need of the people too, how can we solve the problem?
Solving the housing deficit will require a whole lot of multi-level approaches. I don’t believe that government should build homes. I struggled to understand why government should be building houses; it should create the right environment for the private sector, to drive construction and delivery of homes with special assistance. I know that in the past, government has said that some people abuse the process but I think that government should partner with the right set of people.

I also call to questions the pre-qualification criteria that government had used before they put money in the hands of those people. Government needs to create the platform for delivery of affordable and social housing. Government should put in place deliberate programmes for funding the affordability gap for those who acquire houses and provide social housing for those who are unable to build homes. That requires a deliberate process and wholistic approach through policies that would bring together all the stakeholders.

Despite huge demand, driver for real estate investment in the country especially in cities with increasing populations, there has been lull in the sector, particularly this year. What is responsible for current situation?
The truth is, real estate typically mirrors the economy. Whatever happens to the economy also happen to the real estate sector. We are just coming out of recession, real estate suffered because when an economy enters recession, real estate is the first to suffer and the last to come out. In a recessionary period, your asset recovery circle is a little bit longer and that puts a lot of pressure on you as a participant in that sector. The reality of the matter is, the economy itself is suffering from declining demand, purchasing power, so much uncertainty around.

People don’t make real estate decision during uncertainty because that could be their largest real investment they would make in their life. They would want to make such decision when the atmosphere is a bit certain. Today, the lull is not only in the real estate sector, it is in food and beverages, and permeates the entire economy. The sector feel the pinch a lot more because all the enablers that are needed to drive the real estate segment are largely absent in the country.

Enablers such as financing options, incentives, low mortgages to drive the sector are lacking. Fortunately, we have seen interventions for other sectors like bank, textile but government has not provided any intervention for real estate, so the lull persists. I am not an advocate for handouts, but when you have a segment, which has come under such a heavy burden, the government could do well by putting in place programmes that would help to re-catalyse the sector.

You recently launched a real estate company, what was the motivation for the initiative and how would it impact the real estate industry?
I have worked for 33 years in all my life, worked for people, government and other organisations. So after I retired from UAC, I was convinced that I could do a lot more than I have ever done in the area of real estate. I also understood that we needed to do things differently and change the narratives.

With a lot of experiences, gathered over the years, I have to put everything together. I also consulted with people, potential investors, partners, funders of our initiative and that is how we launched Eximia, which is from a Latin word meaning extraordinary, outstanding and unusual. That speaks to what we set out to do in the market. We want to address specific problem that we have seen in the market. We understood that we needed to mobilise capital in a different way. The first thing we did was to launch a real estate cooperative last September to create an avenue for people to have access to long-term targets.

The idea behind the cooperative is to create an avenue for people to have medium to long-term real estate ownership target and to start saving towards it, which will helps us to mobilise capital in a very unique way. We taking a look at a model in Kenya called SACCOS, a cooperative, which account for over 35per cent of national savings and over 90per cent of housing finance.

Venturing into the sector now, are you not bothered about the downturns in the real estate market?
We are bothered but you just have to understand the market and the customers. I have spent a better part of the past five months to really work on our designs and engineer efficient service delivery to customers. We are coming to the market with our studio as low as N18million, one bedroom; N25/N27million and none of our products is prized above N30million for now.

Beyond that, we are also creating different mechanisms because a lot of people in that category have different cash flow and no bulk fund. We have to create a finance mechanism that assists them to take over their units after a particular period like flexible payment plans and others.

What do you think is the best approach to addressing the need for social housing in the country?
We need to do so many things if we must deliver social housing. We need to start through strong reorientation because what is called social housing or affordable housing is not social housing. Social housing starts with the designs. Social housing is supposed to serve and meet the needs of certain category of people so that they can migrate to higher level of housing in the future.

After China, the country that has done a lot of affordable housing, is South Africa. In South Africa, the country started from 40square metres houses and they move up to 80square metres gradually. But here, everybody wants to live in two bedroom flats with all rooms’ ensuite and boys-quarters. The first thing is that we need to revisit our understanding of social housing and once we have done that, come out with efficient designs properly done by value engineers. Then we have to talk about the construction methodology. I always say that we are still building houses but we have to start to industrialise the process of delivery houses. This already happening in some parts of the country, by so doing, we would be able to turn out large volume of houses within a short period.

By industrialising, it means we have to mechanise the process either through prefabrication and other processes which are cheaper, faster and more efficient. It is only happening in the United States of America, but it already happening in Maiduguri where you have a young engineer who has designed a particular type of block, which is being used on large scale. Once we have done that, government has to put the right incentives in place, to help us deliver the houses at affordable price.

High cost of housing and building construction has brought a substantial increase in disinvestment in the construction industry as well as added investment risks. What could be done?
It is not just housing sector that suffers from high cost in Nigeria, it permeates several sectors of the economy. Housing suffers an added problem because the main input, which is land, the cost of land is high. I think pricing is very artificial. In Nigeria, land cost as part of development could be as high as 20/25per cent.

Ideally, the cost of land shouldn’t be more than 10per cent. The infrastructure cost is also there. I did a project where the overall infrastructure cost was about 10/15 per cent, you also have the high cost of perfecting your title, permitting and approvals and all the materials, which you use are imported beyond land and cement, every other things are imported. So you suffer from all importation problems, including exchange rate volatility, which add to the total cost of construction.

By the time you do that, it is difficult to deliver prices at a cheaper rate. However, a lot of reforms are happening in Nigeria which we must commend the government to some extent. For example, at the national level under the housing finance programme, recently the Family Home Funds was established. I believed that the scheme would be a critical driver for solving housing deficits.

There is also NMRC which has recently been reorganised to drive mortgage refinancing and in mortages new underwriting standards are taking place, standard foreclosure laws and model mortgage foreclosure law has also been put into place. Recently, the mortgage warehouse was also launched and I believe that these initiatives would help to solve some of these problems and create a springboard for bridging the housing deficits.

As a high-profile player in the real estate business, which innovations/technology do you think Nigeria needs to adopt in improving the industry?
This is the era of prop-tech, where a lot of things are happening. Technology is driving everything, in our company for instance, one of our core goal is techno-savviness because we understand that would drive our business at both construction and the management end of the market. We need to allow technology to drive business, deplore technology that would provide standardisation, efficiency, and delivery.

What are your projections for the industry in 2019?
This is election years and we are going to lose about five to six months into the New Year. Another Central Bank of Nigeria (CBN) Governor would emerge. We are going to wait and see the policy thrust of the new government and CBN. A lot of things are still hazy but some things are constant. Housing deficits are still there and people will need houses, shortage of infrastructure is still there and there is the need for investment in those areas.

 

Revisiting The Jakande Housing Model

Thirty-five years after Alhaji Lateef Kayode Jakande left office as the first civilian governor of Lagos State, his legacies in the housing sector are still speaking for him. Although most of the houses built by Jakande are today in distressed conditions due mainly to lack of maintenance culture, they are still housing many Lagosians.

With the coming of his administration in 1979, significant policy changes involving a more radical and integrated approach were adopted, in alleviating the housing problems in the state.

The major strategies adopted were: (i) Direct construction of housing on a massive scale, which was anticipated, would reduce the perennial shortage of housing, particularly for low-income groups.

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(ii) Establishment of the New Towns Development Authority (NTDA), in 1981, to provide an enabling environment for private initiative in housing provision, and open up new towns to accommodate the growing population.

(iii) Establishment of Lagos Building Investment Corporation, (later renamed Lagos Building Investment Company, LBIC), to encourage savings for building or purchasing of houses, and granting loans to prospective, qualified homeowners. These, along with the LSDPC and the State Department of Lands and Housing, were the main institutions involved in the development of housing policies and projects in the State during this era.

A relatively higher quantitative contribution came in only four years under the first civilian administration (1979-1983), which emphasized public housing. This period represents to date, the most dynamic in the history of public housing in Lagos State.

The housing programme in this era derived from a housing policy, based on a political ideology which recognized the right of every citizen to adequate shelter. As the implementation agency of the 1979-1983 housing programmes, LSDPC embarked on massive construction of low-cost housing estates.

The administration envisioned a programme of 50,000 housing units, out of which by 1983 when the military terminated the civilian regime, about 16,000 units (32 %) had been completed and allocated. Though the number was far below the target and grossly inadequate relative to the high demand for housing in Lagos, when compared to the combined efforts of its predecessors and successors, it made more contribution to the provision of 12 housing Estates in Lagos State.

To further the cause of its housing policy, the administration extended the staff housing loan scheme previously enjoyed by senior staff only, to low-income workers in Lagos State Public Service, who had worked for a minimum of ten years. The loans granted under liberalized terms of payment, enabled low-income employees to purchase housing units. Most of the existing public housing estates in Lagos, particularly in the low-income category, were implemented during this era.

These can be considered as the most representative legacy of the notion of public housing in Lagos and they constitute substantial interventions in the urban context.

The Jakande Estates in various parts of Lagos brought succour to many families when they were built in the early 80s

The estates were con­ceived as a solution to the peren­nial housing and accommodation problems in the acclaimed Centre of Excellence.

With this political masterstroke, the former governor’s name was etched in gold in the hearts of resi­dents of the state, and he became a reference point among his peers on how to address the housing needs of the people.

There was euphoria following the allotment of the estates in 1983, flats were got through lucky dips and lotteries and paid for at relatively low prices with the highest then going for N3, 000.

The initiative saved many families from relocating from Lagos and afforded them the opportunity of becoming landlords.

The estates were beautiful and the environments serene, well planned with internal access roads well tarred, to complement the luxuriating colours of paints on the blocks of flats, each owned by different landlords.

The prototype of the low-cost housing was replicated in different parts of the state, such as Oke-Afa, Isolo, Adeniji Adele, Abesan, Iyana-Ipaja,Iponri, Lekki, Ketu-Alapere, Amuwo-Odofin and other places had one form of the scheme or the other.

The implementation of the housing policy in Lagos, under Jakande offer a number of lessons that can help inform future choices. It is needful to develop alternative future scenarios for public housing in the next few decades to challenge the status quo and assist long term strategic planning.

Scenarios are not predictions of the future, but descriptions of alternative possible futures, which are used to stimulate thinking about the future and to test long-term strategic plans.

Source: Affa Dickson Acho with various sources

REDAN SETS TO HOLD FUND RAISING FOR AMBITIOUS BUILDING PROJECT

In its quest to have a befitting National Secretariat to carry out its operations, the Real Estate Developers Association of Nigeria (REDAN), is set to hold a fundraising and launching, for the building project.

The fundraising and launching, codenamed REDAN House, will take place on 11 December 2018 at Sandralia Hotel, Solomon Lar Way, Jabi – Abuja.

Speaking on the launching and fundraising event, President of the Real Estate Developers Association of Nigeria, (REDAN), Reverend Ugochukwu Chime, said

“On the 11th of December 2018, by 11am at Sandralia Hotel Abuja, we will be having a REDAN House launching, where we will invite REDAN members, developers and partners for us to sit down together, see how far we have come and see the necessity for us to be able to have a house for ourselves, a house whereby we can have a library, where you can go to for information and data, we are looking forward to raising over 300 Million Naira to have the total package of the house and the infrastructure we need”. The REDAN helmsman said.

 

The Association is collaborating with its members, other developers, critical stakeholders and development partners in the housing and construction industry to achieve the goals of the project. The historic endeavour between REDAN and the critical stakeholders aims to build and deliver a decent, prestigious and quality office space for the Association before February 2021.

Rev Chime, added that he will ensure the building is ready before the end of his tenure, and will also honour donors who are making this project a reality, he said,

‘’I intend to have this house completed so that my successor to the office of REDAN president will not have to use a rented apartment as we are doing now. “We have also made provision for us to have a memorable plaque in front of the building for donors, and the six highest donors will have halls named after them, so that generations to come will know that these great men at a time when there was a clarion call for those who will rise and do the needful and build a house for REDAN, these ones responded.”

The launching of the REDAN House Building Project will take place under the Distinguished Chairmanship of Mallam Ibrahim Aliyu, Chairman of Urban Shelter Limited while the Special Guest of Honour will be Surveyor Suleman Hassan, the Honourable Minister of State for Power, Works and Housing.

The Guests of Honour for the event include Architect Ahmed Musa Dangiwa, Managing Director and Chief Executive Officer of Federal Mortgage Bank of Nigeria (FMBN), Mr. Femi Adewole, Managing Director and Chief Executive Officer of Family Homes Fund and Mr. Kehinde Ogundimu, Managing Director and Chief Executive Officer of Nigeria Mortgage Refinance Company (NMRC).

 The Real Estate Developers Association of Nigeria (REDAN) is the principal agency and umbrella body of the organized private sector (public and private) responsible for housing development in Nigeria, having been conferred with official recognition by the Federal Government of Nigeria since November 2002.Membership of REDAN is open to: Limited Liability Companies, Registered (Co-operative) Societies, partnership, and parastatals of State or Federal Governments who engage in real estate development.

Source:Affa Dickson Acho

Real Estate sector:Nigeria and Ghana record minimal growth in 2018

Real estate consulting firm JLL has released its 2018 City Reports for Nigeria and Ghana to offer a concise overview of current developments in the local office, retail, hotel and industrial sectors.

In wavering economic conditions, the analysis offers several interesting points and trends to note regarding local investment markets, vacancies and rental growth.

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Commenting on the Nigerian real estate environment, Zandile Makhoba, Head of Research for Sub-Saharan Africa, JLL, confirms that the various sectors have seen minimal growth in 2018, with rental rates for both retail and office space hovering around the same levels as last year.

On the positive side, the report outlines that the recent economic recovery and stable exchange rate have motivated the continuation of some of the development projects that were placed on hold last year. “Office stock has increased by about 11,000m2 in 2018 despite the slow improvement in demand for space,” says Makhoba.

Shifting to Ghana, prospects are even more positive in the capital city. “Accra has benefited from a significant pick up in the supply of quality real estate assets, from office to retail, to hotels and industrial,” Makhoba says. The report suggests evidence that the country should benefit from the recovery in global commodity prices through the previous 12 months which should underpin economic growth and stimulate investor confidence.

As demand gravitates to new stock in the office market, it could tip into oversupply. However, sentiment is encouraging with international capital becoming more active in the city.

While retail accommodation is expected to grow by a further 30,000m2 to 40,000m2 in Accra, the prime industrial market in Ghana remains under-developed. As the economy improves and demand increases, there are certainly opportunities for developers. There are also good prospects in the hospitality market with a recent proliferation in the serviced apartment sector. Makhoba also says the number of international brands entering Accra’s hotel market is set to further establish the Gold Coast airport node.

Summing up both city reports, Makhoba says Accra remains a strategic entry point for investors looking for strong demand fundamentals, political stability and a relatively transparent real estate sector. “We anticipate that transactional activity will increase in the next few years, driven by a recovery of the economy, owners looking to recycle capital and more rational development costs.”

The upcoming elections in Nigeria may slow down economic activity in the first half of 2019. However, the Nigerian economy is expected to improve in the short term as business and investor confidence picks up, and we can still expect positive momentum through 2019 and into 2020.

Source:africapropertynews.com

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