‘We are driven by our vision to build 1 million homes in the next 20 years’

 

Taf Nigeria Homes, a subsidiary of Taf Africa Homes, is a ‘foreign’ real estate firm making direct investment in the Nigerian economy. The company entered the Nigerian property market with a bang, developing over one thousand luxury but affordable homes at its RIVTAF Golf Estate in Port Harcourt. In this interview with CHUKA UROKO, the Group Managing Director/CEO, Mustapha Njie, speaks on the Nigerian economy, the recession, the real estate market, the potentials, opportunities and challenges in the market. Among other things, Njie also speaks on the company’s future plans in Nigeria. Excerpts:

Taf Nigeria Homes Limited is, for purposes of definition, a foreign real estate firm making direct investment in Nigerian economy. What was the attraction to Nigeria?

When we came into Nigeria in 2013, Nigeria had an estimated population of about 150 million, a dearth of housing, and an increasing annual population growth rate. These factors made the real estate sector very attractive and the potentials still remain untapped. Our experiences have not been too palatable particularly in view of the economic situation of the country in the last 3 years, but it’s been worth the while as we take pride in delivering a luxury estate with quality homes and seeing our client express satisfaction with our products and services. We are also particularly elated to acknowledge that our project positively impacted the lives of members of the community, individually and collectively.

You have been in the Nigerian real estate market for over five years now and still counting. What story can you tell of Nigeria, its property market and the economy in general?

Prior to being hit by the recession experienced in the country, the real estate sector made certain contribution to the real GDP of Nigeria. In 2015, the real estate sector was reported to have contributed 8.26 percent to the real GDP of Nigeria (National Bureau of Statistics: Nigeria Gross Domestic Product Report, Q1 2015). Unfortunately, the contribution of the real estate sector to the real GDP has reduced over the past years due to the recession.

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The National Bureau of Statistics reported that in the third quarter of 2017, the real estate sector contributed 6.79 percent to real GDP, lower than the 7.18 percent reported in the third quarter of 2016 (National Bureau of Statistics: Nigeria Gross Domestic Product Report, Q3 2017) and lower than 7.57 percent reported in the third quarter of 2015 (National Bureau of Statistics: Nigeria Gross Domestic Product Report, Q3 2015). Although the country is said to have come out of recession, the real estate sector is yet to recover from the impact of the recession.

This is evident in the Nigeria Gross Domestic Product Report, Q1 2018 of the NBS which puts the real GDP growth in the sector in Q1 2018 at -9.40 percent and a contribution of 5.63 percent to real GDP (National Bureau of Statistics: Nigeria Gross Domestic Product Report, Q1 2018) which is lower than the 6.32 percent of Q1 2017 and the 6.48 percent of Q1 2016 (National Bureau of Statistics: Nigeria Gross Domestic Product Report, Q1 2017).

Nigeria successfully exited a crippling 15-month recession. Our focus in this report is on those real estate firms, which you are one, that are still afloat despite the impact of the recession. Tell us your story in the circumstance.

Without a doubt, the real estate sector attracted investments from individuals, corporates, foreign investors in a large scale prior to the recession that hit the Nigerian economy. It cannot be overemphasised that, just like other forms of constructions, real estate development requires significant capital. Till date, the sector has witnessed limited equity financing, hostile debt financing (particularly in view of harsh lending rates which was reported to have hit 30 percent per annum) and weaker effective demand triggered by inadequate and unfriendly mortgage facilities.

We were not insulated from the situation of the sector as we are a key player in the sector. However, we were resolute to deliver on our promise of delivering affordable luxury estate to our target clientele without compromising the quality and standards which our brand is known for across the continent. To this end, we decided to take certain strategic steps which I hope to discuss in the course of this interview.

A major problem for developers like you during the recession was credit drought and hyperinflation that eroded people’s purchasing power. How did you source funding for your projects?

The poor state of the economy, worsened by the recession, posed significant barriers on the availability of finance for the real estate sector. This is because the few lending institutions that could ordinarily provide construction financing to real estate players or mortgages to encourage demand for real estate products could no longer provide such facilities. The cost of finance (especially debt finance) during the recession was alarming so we decided to deploy other innovative and creative means of generating funds outside debt finance.

For you to have sustained your business till now means you are a resilient company and indeed you must have brought innovation and creativity into your operations. How did you do it?

In a bid to navigate the storms in the sector and continue to provide quality products and services to our growing clientele while we remain profitable, we had to deploy creative strategies. These include introduction of certain value added services to our existing superb customer service experience; redesigning our products to smaller units in order to make them more affordable; introducing new products like serviced plots; evaluating ongoing construction works on defaulting clients’ property and renegotiating sales agreement with a view to handing over such properties “as is”; strategic engagements of marketing agents especially by providing incentives to existing clients who make referrals to us; and ultimately introducing a contractor/vendor/supplier-financing (C/V/S-F) system.

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We are particularly fascinated about the C/V/S-F system which you adopted in the RIVTAF Golf Estate. What is this system all about and how did it work for you in the marketing and sales of that estate?

The C/V/S-F system is a system wherein certain aspects of the development and infrastructure within the RIVTAF Golf Estate were financed by the contractors/vendors/suppliers themselves. So, rather than paying the contractors/vendors/suppliers for the services provided to us, we issue them with some properties for the contract sum and at negotiated prices. The contractors/vendors/suppliers in turn sell off these properties or collateralise the properties to finance the contract. This strategy was not limited to new contracts, it was extended to existing contracts that had been partly paid for as well as to contract that had been fully performed but with outstanding debts to the contractors/vendors/suppliers.

As a result of the C/V/S-F system adopted in the RIVTAF Golf Estate, the estate is nearing completion. Work has progressed significantly on our shopping mall and completion is now in view, liabilities have been reduced thereby freeing up funds for other operations and commitments of the company. The C/V/S-F system allowed our company to continue to create value and deliver on the promises made to our esteemed clients while our contractors/vendors/suppliers remained in business and continued to make profit. It is apposite to also note that this system guaranteed sales of our products. This is in view of the fact that properties given to contractors/vendors/suppliers in place of payment for services rendered are deemed as sales on our accounts as they are deemed to have been paid for by the receiving contractors/vendors/suppliers.

The challenge of the C/V/S-F system was a potential parallel market but this was well managed as the structure of the C/V/S-F system already anticipated this challenge and had ready preventive solutions for such potential challenge. Rather, a viable secondary market was created where contractors/vendors/suppliers became strategic players in the secondary market for our products.

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RIVTAF Golf Estate is a project with which you stamped your signature in the Nigerian real estate market. Any plan to replicate that in any other part of Nigeria? Where and when should we expect that to happen?

Yes, we intend to replicate and do even greater projects in Nigeria. TAF Nigeria Homes Limited and its sister companies across the African continent are driven by our vision to build 1million homes in the next 20 years. Nigeria remains one of the biggest economies for such projects. With an estimated population of over 184 million as at December 2017 (World Bank: The World Bank in Nigeria), a conservative estimate of 17 million units of housing deficit as at 2015, an annual population growth rate of 2.8 percent (National Population Commission and National Bureau of Statistics Estimates), the potentials of the real estate sector remains unimaginable. We are optimistic that the sector would recover from the negative results being reported and start experiencing positive growth. The Nigerian real estate sector can!

We want to believe that it has not been a bed of roses for you operating in Nigeria. What have been your major challenges in this country? Do you have any regrets being where you are?

Every business faces certain challenges and indeed a significant chunk of such challenges emanate from governments and regulators in each sector. We have had our share of this and can only ask that government makes increased efforts at improving the ease of doing business in Nigeria. Another significant challenge is the dearth of infrastructure in the country. The absence of infrastructure such as roads and efficient transport system impacts location and viability of a project. Infrastructure must be given its deserved attention by the government.

What are your projects in terms of growth and expansion in the next four to five years?

We have a couple of projects to deliver in Nigeria but I would not want to put the cart before the horse. We are in advanced level discussions with the governments of some key states in the South-Western and South-South regions of the country and have reached certain Agreements in Principle and signed a Memorandum of Understanding. In due course, these projects would come on stream. It may also interest you to know that we have built a formidable and highly competent team in Nigeria to manage the company’s operations in more than one location as we expand into other states..

CHUKA UROKO

NIA President laments neglect of Nigerian Architects

President of the Nigerian Institute of Architects (NIA), Arch. Festus Njoku, has expressed concerns over what he described as neglect of Nigerian architects in the execution of government projects.

Arch. Njoku stated this while speaking with Housing News Crew ahead of the NIA’s 4th distinguished lecture series scheduled to hold September 24 at Shehu Musa Yardua Center, Abuja.

He emphasized the importance of Nigerian architects, especially in the infrastructural development of the nation, saying undermining them is detrimental to the nation’s economy.

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The NIA President lamented on the patronage of foreign architects to execute what their Nigerian counterparts can do far more better.

His words; “The architect is the master builder. He conceives the idea and transfers to a paper through sketch where another person can read his mind.

“It is a pity things are no longer happening in our country. Now what is happening in our country, you see Chinese bringing this sort of package they call “loan,” but they go further to put conditions. ‘our men will do the work’. They will do the design, they will do the construction, and our governments are willing to have it that way.”

“We are not happy about it because Nigerian architects have the capacity to design all over the world.” “We cannot go to China to do their works for them.” He added.

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Articulating his vision as NIA President, Arch. Njoku said he looks forward to ensuring a reduction in the cost of housing delivery despite some challenges affecting the housing sector. He disclosed that plans were already in place to launch the ‘Nigeria Affordable House’.

“Although alternatives to expensive building materials have been discovered, it is hand woven by somebody which makes the cost higher. Therefore, a strategy to mechanize the whole process is being worked on to reduce cost of production. Nigeria Affordable House is already on the way. We will present it to the public next year.” He assured.

Ibrahim Muhammed, Housing News, Abuja.

NIA 4th Distinguished Lecture Series to celebrate Arc. Gabriel Aduku’s excellence in the Nigerian Architectural community

 

The President of the Nigerian Institute of Architects (NIA), Arc. Festus Adibe Njoku has said that the NIA is set to recognize and celebrate the immeasurable impacts of Arc. Gabriel Yusuf Aduku in the Nigerian Architectural Industry at its 4th Distinguished Lecture Series to hold on September 24th, 2018 at the Shehu Musa Yaradua Centre, Abuja.

In a chat with HousingNews Correspondent earlier today, Arc. Festus explained that the distinguished lecture series is an annual event which was established as an avenue for past presidents to impart the knowledge they have acquired over the years to members of the association.

He made it known that as it’s the custom of the association; this year’s mantle has fallen on Arc. Gabriel Yakubu Aduku FNIA, PPNIA, OON a past president of NIA and the Principal Consultant & Director of Archon Nigeria Limited, to lecture the architectural community and Nigeria at large.

“… Arc. Gabriel Aduku is going to deliver this year’s lecture, somehow it’s like a parting gift to the profession where he will impart to us, what he want us to remember him for.” he said.

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The President added that the lecture series is “a time to give back to society… as a past president you must have gone through many stages and gathered many experiences right from the state chapter …so let him impart those ideas to the profession and to the society as we are celebrating his excellence by having him give us a distinguished lecture series”

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Also present in the chat session was Arc. Sunday Echono, Vice president of the NIA and the Chairman of the 4th distinguished lecture series committee. The NIA Vice President told HousingNews that the event will be a full program where excellence will be awarded and Arc. Aduku’s Book titled “Beyond simple lines” that “articulates his design philosophy, his accomplishments and the architectural culture that his firm has been able to establish and propagate in architectural economy” will be launched.

Arc. Sunday described Arc. Gabriel Aduku as “a man of many parts, he has led us as the president of NIA, ARCON, and if you look at the footprints he is someone who has played very key roles in our architectural economy. He is the first president from the northern part of the country and his firm Archcon Nigeria Limited is one of the top architectural firms in Northern Nigeria responsible for developing well known architects in northern Nigeria.”

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“His firm has been in operation for over 50years and has been producing so many architects who have gone on to also do lots of projects and a lot of that will be on display at the event” he added

Arc. Sunday enjoined friends, well wishers and every professional in the construction industry to come and join the Nigerian Institute of Architects to celebrate Arc. Gabriel Aduku an icon in the Nigerian architectural community.

“it is a period where we celebrate accomplished architects who have served the profession very well and also being a role model to the sector.” He said.

Wilson Ifeoma, HousingNews, Abuja

£2bn fund for building low-cost homes, Theresa May declares

Prime minister to call on associations to help end social housing ‘stigma’ that sees tenants treated as ‘second class citizens’

Housing associations will be handed £2bn in new funding to help them build low-cost homes, under plans set to be announced by Theresa May tomorrow.

The prime minister will tell associations they will be allowed to apply for money for the next decade in a bid to give them greater financial security.

Ms May will also call on housing providers to help end the stigma around social housing that, she will say, sees many politicians “look down on” people who live in low-cost homes.

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She will tell a conference of the National Housing Federation, which represents housing associations, that “the most ambitious” providers will be able to bid for government money to last them until 2028-29.

The money will come from housing budgets in the next spending review period – the details of which are not expected until next year.

Ms May is expected to say: “You said that if you were going to take a serious role in not just managing but building the homes this country needs, you had to have the stability provided by long-term funding deals. Well, eight housing associations have already been given such deals, worth almost £600m and paving the way for almost 15,000 new affordable homes.

“And today, I can announce that new longer-term partnerships will be opened up to the most ambitious housing associations through a ground-breaking £2bn initiative. Under the scheme, associations will be able to apply for funding stretching as far ahead as 2028-29 – the first time any government has offered housing associations such long-term certainty.

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“Doing so will give you the stability you need to get tens of thousands of affordable and social homes built where they are needed most, and make it easier for you to leverage the private finance you need to build many more.”

Ms May will demand associations “achieve things neither private developers nor local authorities are capable of doing” and call on them “to take the lead in transforming the very way in which we think about and deliver housing in this country” by “taking on and leading major developments themselves”, rather than simply buying properties built by developers.

She will also ask associations to help end the “stigma” around social housing, admitting that too many people, including politicians, “look down on” people who live in low-cost homes.

“For many people, a certain stigma still clings to social housing. Some residents feel marginalised and overlooked, and are ashamed to share the fact that their home belongs to a housing association or local authority”, she will say.

“And on the outside, many people in society – including too many politicians – continue to look down on social housing and, by extension, the people who call it their home.”

She will add: “We should never see social housing as something that need simply be “good enough”, nor think that the people who live in it should be grateful for their safety net and expect no better.

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“Whether it is owned and managed by local authorities, [tenant management organisations] or housing associations, I want to see social housing that is so good people are proud to call it their home… Our friends and neighbours who live in social housing are not second-rate citizens.”

Ms May used her speech at last year’s Conservative Party conference to announce £2bn of new investment in low-cost housing – enough to build 5,000 new homes per year – although this was criticised as being significantly less than is needed.

No 10 said the new £2bn was in addition to the amount announced last year.

However, Labour said the latest cash injection would not be enough to reverse the impact of previous cuts to housing budgets.

John Healey, Labour’s shadow housing secretary, said: “Theresa May’s promises fall far short of what’s needed.

“Any pledge of new investment is welcome, but the reality is spending on new affordable homes has been slashed so the number of new social rented homes built last year fell to the lowest level since records began.

“If Conservative ministers are serious about fixing the housing crisis they should back Labour’s plans to build a million genuinely affordable homes, including the biggest council house building programme for over 30 years.”

Benjamin Kentish

Affordable housing possible in Nigeria

It is becoming increasingly difficult for young people to get a step on the housing ladder. Available statistics on Nigeria’s housing deficit paint a grim picture; presents limitless opportunities.

Available data (for 2014) from the World Bank and the National Bureau of Statistics agree that Nigeria has an estimated housing deficit of over 17 million units.

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With a population of almost 180 million, according to data from the United Nations, an annual population growth rate of 2.8 per cent (2015) and an annual urban population growth rate of 4.7 per cent, we need to stop talking and start building.

Nigeria’s abysmal ranking on the mortgage finance scale show that the several mortgage financing initiatives by successive governments in the country have failed. The Nigerian Bureau of Statistics (NBS) reported that Nigeria’s real estate market contributed only 6.82% to the real GDP down from 8.37%.

However, stakeholders agree that the country’s real estate growth is impressive; with PricewaterhouseCoopers (PwC) projecting, in its report – ‘Real Estate: Building the future of Africa’, – that Nigeria’s real estate investment will rise by about 49%, from USD9.16 billion to USD13.65 billion in 2016.

Investors are impressed with the outlook and have made significant inroads in tapping into the opportunities presented by the country’s housing deficit. Housing is a basic human need as a first important level of need similar to food and drink; therefore, it is at the center of wellbeing, People must have food to eat, water to drink and a place to call home before they can think about anything else.

To encourage more of this type of investors, Nigeria’s policy makers need to ensure that access to long-term finance is guaranteed to enable investors attract consumers from the upper end of the market that play in the prime real estate sector. The gaps in government-run infrastructure would also need to be plugged to guarantee efficient urban development.

The government would also need to promote favorable macroeconomic policies which will in turn encourage private sector investors to partner with her in providing low-cost mass housing. These policies must result in low interest rates, stable exchange rates and low inflation to encourage investors move into mass housing projects and low-income earners move from rented housing to their own affordable mortgage-enabled homes The Federal Mortgage Bank of Nigeria (FMBN) initiated the National Housing Fund (NHF) scheme to facilitate the provision of houses to Nigerians and bridge the housing deficit.

Many civil servants have benefited from the NHF scheme, although some are yet to benefit; people clamor for the review of the scheme. In order to broaden access to affordable housing and also solve the problem of prolonged processing time for mortgage loans, Platinum Mortgage Bank created a product called PLATINUM FASTTRACK MORTGAGE.

This product allows eligible Nigerians have access to their homes through mortgage within 48 hours of meeting the conditions. The procedure is simple. Any Nigerian above 21 years with a verifiable and regular source of income, a tax payer who meets all the condition of the loan which includes equity and repayment plan gets the key to a house of his choice in 48 hours. Platinum Mortgage Bank Ltd is a flagship in the banking and Mortgage sector; one of Nigeria’s leading primary Mortgage Institutions that met the CBN’s stipulated deadline for recapitalization and raised its authorized capital of five billion Naira.

Platinum Mortgage Bank Limited has been re-positioned to provide excellent home ownership products and has assisted numerous Nigerians in their quest for home ownership in various estates across Nigeria through the National housing fund as well as other mortgage loan windows of the bank. Powered by a visionary leadership, Platinum Mortgage Bank Limited is poised to provide your dream home through affordable mortgage backed housing schemes. We are implementing our corporate mission which is to improve the welfare of Nigerians through the provision of efficient stress-free and quality house delivery services at affordable cost.

Joseph is Head of Corporate Affairs, Platinum Mortgage Bank Limited, and is based in Abuja.

Sunday Joseph

Fresh concerns over physical development as States shun cities, towns master plan

These are not the best of times for town planning practice as most of the State governments have relegated the issues of cities and towns master planning to the background, and abused physical developments.The Nigerian Urban and Regional Planning Law of 1992 stipulated that every State should embark on preparation of physical development plans at regional, urban and local scales to guide the efficient growth of its settlements. But the reverse is the case as most of them have ignored it, leading to rapid manifestation of slum conditions.

Conference of Directors and Heads of Town Planning Organisations in Nigeria recently confirmed the development and decried the generally poor level of regulatory and institutional instruments that are available to support town planning practice in Nigeria, and observed that most settlements do not have physical development plans to guide their growth and where available their life periods have expired.

They had agreed that preparation and implementation of a mutually agreed National Physical Development Plan (NPDP) should be adopted as one of the tools for integrated physical planning and effective delivery of development benefits to the people of Nigeria.Most States are not adhering to the recommendations and have continued with business as usual. Attempts were made by the United Nations Human Settlements Programme (UN-Habitat) to bridge the gap.

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UN Habitat has worked with many states to prepare structure plans for major cities. “All the plans were prepared with strong public/ stakeholder participation to ensure that the priorities and needs of the residents are well understood and adequately provided for in the plans,” according to Kabir Yari, Manager, UN Habitat Support Office in Nigeria.

The agency assisted Anambra, Nasarawa, Osun, kogi, Niger States in the development and adoption of structural plans in major cities. For instance, Awka, Onitsha and Nnewi (Anambra); Lafia, Doma, Karu, Keffi (Nasarawa); Osogbo, Ikirun, Ila Orangun, Ilesa, Ile Ife, Ede, Iwo, Ikire and Ejigbo (Osun); Lokoja, Okenne, Kabba and Dekina (Kogi) a as well as integrated development plan for Minna and Suleja (Niger).

Preparation of urban profiles in ten urban centres, provision of three one-stop youth centres and urban upgrading in the old city of Katsina and formulation and adoption of 20-year Structure Plans in the three participating Cities (Umuahia, Aba, Ohafia in Abia State is still in preliminary stages.

Specifically, the town planners are worried that situation has degenerated. Yari who was a past President, Nigerian Institute of Town Planners (NITP) told The Guardian, “Lack of development plans for major urban areas means that the cities will grow in a haphazard and inefficient way. “This makes accessibility difficult, cause in efficient use of land resources and conversion of good agricultural development to urban development. In addition the urban form becomes locked, needing alot of resources to upgrade to planned settlement.

“It is always more cost effective and more efficient to plan in advance, ahead of development. This ensures the development of compact, connected and integrated settlements that are efficient and safe and pleasant to live in. It therefore strongly recommended that all urban areas should have physical development plans to guide their growth.”

According to him, the challenges are many. They include lack of appreciation of the importance of planning, dwindling financial resources for states and local governments and lack of implementing most of the plans already prepared.NITP second Vice President, Mr. Olutoyin Ayinde said, “The moment there’s no balance in development as prescribed by the plan, there will be a tilt toward where development is taking place, which explains why migration takes place from rural to urban, from less developed states to more developed state.

He lamented that the policy makers are not paying attention to planning. “Policy makers and administrators often think that planning is about pieces of paper. What they do not realize is that dreams (of beautiful settlements) first start in the mind as a vision, then they are put on paper to test the feasibility. If you win on paper, you are likely to win on ground.

“A people get the kind of settlements that they deserve. It is necessary to underscore the high level of ignorance, even at the policy level, and that’s where the problem is. There is need for more awareness to put planning, especially physical planning in its rightful place. Organized cities are deliberate; they are not coincidences. It is planning that makes them organized.”

Collaborating the views, Abubakar Sani, a past President, Association of Town Planning Consultants of Nigeria (ATOPCON) revealed that only Abuja has and followed master plan for its physical development. “Even where attempts are made to have a master/structure plans, such plans are abused by the governments, only used as a tool to punish the opposition. Master plans are made to guide physical development but here in Nigeria, our leaders only call for master plan when problem arises. Master plans prevent foreseen problems not to cure problems.

“The master plan for Kaduna is obsolete, even though an attempt was made to renew it but it is not completed. Lack of master plan to guide physical development is like physical development through trial and error. Thereby leading to waste of resources, lives and properties. Town planners are trained to forecast challenges of physical development and provide guidelines for mitigating such challenges. However in Nigeria we just want to see physical development without preparing for it.”

Another town planner, and ATOPCON past President, Moses Ogunleye, lamented that the commitment to implement the master plans have not been there. “Even before it expires, less than 30 per cent of the proposals of the plans are not implemented.”

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The NITP Public Secretary, Mr. Olugbenga Ashiru stated that the situation always affect physical planning as there is no instrument to control development, “it leads to development of blighted areas and non availability of basic infrastructure facilities and utilities.”

He called for political will among the administrators to produce and implement physical planning policies and plans; synergy between professional bodies like NITP and government agencies as well as public sensitization and stakeholders’ engagement on physical planning issues. Ashiru exonerated the town planners in the public service and link the problem to inadequate manpower, funding and bureaucracy. “They can only suggest to government on what to do and enforce it, they work in line with the government directives,” he added.

Guardian

Obaseki’s affordable housing: Emotan Gardens’ first phase of 86-units ready by year end – EDPA boss

 

In what has been described as a revolution in Edo State’s housing sector, the first set of homeowners in Governor Godwin Obaseki’s affordable housing project, Emotan Gardens, will move into their property at the end of the year.

Emotan Gardens Executive Chairman, Edo Development and Property Agency (EDPA), Isoken Omo, disclosed this in a chat with journalists and assured prospective buyers that 86 units of the houses, which constitute the first phase of the project, will be delivered before the end of 2018.

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She said, “Emotan Gardens is a 1, 800-unit gated housing estate which will be done in phases and clusters. The first phase is actually a show phase with about 86 units in it. When it is finished, people can live there. While they are living there, the other phases will be built. In the end, everything will be joined together to become a full estate.”

She explained that the construction of the 86 units is ongoing and assured that it will be ready at the end of the year, noting, “By then people will live there. There will be infrastructure and not just the houses will be ready. We will have roads, lawns, water and electricity there.” According to her, “The sales for the properties opened at the Edo National Association Worldwide (ENAW) convention, in Toronto, Canada. All the slots are available. Because it is being delivered in phases, it will work in two ways so that we will deliver on our promise. For example, if you don’t have all the money, and then deposit some amount and tell us when you want it ready, it gives us enough time to build up capital.”

On the first phase, Isoken explained, “We have different types. We have four 2-bedroom in a row; 3-bedroom row of houses, 2 and 3-bedroom semi-detached; 3-bedroom semi-detached; blocks of flats; 4-bedroom stand-alone bungalows, terrace houses, 3-bedroom with a maid quarters.

“We have commercial plots and residential plots. Within the commercial plot, we have shopping malls. Within the estate, we have made provision for school, hospital, police station and all those things you need in a community.”

Explaining that there is provision for those who want to build for themselves to buy plots of land, she said, “You can buy a plot of 450 sqm land or 900 sqm land. There is a design guide but it is not rigid. The guide is to ensure homogeneity.”

On the prices for the houses, Isoken said, “The house starts from N5.7 million for the cluster of 2-bedrooms and it goes up to N7m, N8m, N9m and so, according to the housing type. But N5.7m is the entry price. We expect 25 per cent down payment at expression of interest, and then you complete the necessary forms, including the Know Your Customer (KYC) form.

She explained that the KYC form is to “ensure the money is not laundered, and that it came from a clean channel. The onus is on us to check that to ensure we don’t fall foul of the laws. After this, we process the form, then you pay the deposit and we send you your Letter of Offer with terms of payment.

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“There are different payment options. We have outright purchase; 18-month payment plan for payment in tranches, and mortgage arrangement. We are looking at different mortgage options that people can tap into which will be affordable.”

Isoken assured prospective buyers that the model house and other houses on that row are nearly completed, while painting work is ongoing, adding, “The inside of the model house is ready. We are painting others on that row. Some are at the roofing stage, others are at the block stage. By December when we are ready to deliver, all of them will be ready. At the same time work is ongoing on the greenery.”

“You Can Enjoy Rental Income without Owning a Property”

Founder of Africa’s Property Investment Group, Mr. Chudi Kalu, in this interview with Mary Ekah, speaks about investing in the real estate business as the surest way to building and securing one’s future, providing insights and latest money-making tips in the property market in Africa, among other issues

How would you describe Nigerians attitude towards investment in real estate?

So far we have realised that people fear that the recession in the nation will stop them from investing in property. But that is not the case because a lot of people are already taking advantage of real estate investment because they know that the way to come out of any form of recession is when they enjoy consistent cash flow. So a lot of people are investing in real estate at this particular time.

That is why we have been holding a lot of seminars and workshops lately aimed at opening the minds of investors to how they can change their financial levels for better by investing in real estate, the opportunities that are available to people and how ordinary individuals can take advantage of the investment opportunities available within the real estate sector without having to break the bank. And I think that for real estate industry to grow in Nigeria and for property business in Nigeria to be activated properly, investors should come in; and we cannot always expect foreigners to invest in real estate in Nigeria, we the local people should take advantage of the opportunities around us.

You have had series of conferences and workshops on real estate lately, what is the driving force behind all these?

We at AFPING are trying to give everyone an opportunity to invest in high quality real estate investment. Presently we have projects in Surulere, Yaba, Ijesha amongst other areas in Lagos and elsewhere. We also have some UK projects that we are pursuing at the moment. Anybody can take advantage of these opportunities and you don’t necessarily have to live in the UK to invest in the UK. To this end, we have been doing a lot of coaching on real estate investment and how people can take advantage of the rental market. We are particularly focused on educating people on how they can enjoy rental income without owing a property of your own.

People keep wondering if this is possible. It is actually very possible if you understand how it works. Now because of the challenge of buying property in certain areas, a lot of people have lost money because of “Omo onile” and they bought property expecting that some of those property will appreciate but after 10 years, they probably do not know where the location of that property is and at the end they would realise that they must have been duped. So it is better to play within a particular market where you can easily take advantage of. Now how do you participate in the Lagos market for example without getting your hands burned? At least we can see the population.

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When I see the Lagos traffic, I get so excited and then some people wonder why I am so. I feel so because as long as there are people within town, rent will continue to go up. And what drives rental income for landlords is the number of people that lives in a particular area. And how do I as an individual participate in that game without actually owning a house is what we have been able to figure out at these seminars and workshops. When you go round that, you see a lot of property that are empty and also property that the landlords do not have the required funds to put them in good shapes because they probably do not have a regular income and yet the property is within a good location.

All one needs to do is to invest in such property and renovate for better rental charges while both the landlord and investor share the profits. So, as an investor, you do not have to buy the property to share in the profits, All you need to do is just to invest some money for its renovation and then in return get huge rental income. That is what we coach people on during the seminars and workshops that we have been holding lately and you don’t have to be an expert in the industry before you can earn rental income but all you need is to have a little fund on ground.

According to statistics, we have 17 million housing deficit in Nigeria and if every household pays a hundred thousand naira from the 17 million housing deficit that we have in this country that will be more than 17 billion naira annually. So I would say that the deficit we are facing in the housing sector is an opportunity and not a curse.

And it is those people who see the opportunity within that market that would take advantage of it. If they say we have about 17 million housing deficit, what it simply means is that you have 17 million families who are ready to pay only for kind of houses they can afford, so that means that if anybody has the houses that fit their needs, they would be willing to pay. So the deficit is an opportunity for only those that see it as a business opportunity and can then thrive on it.

So it is a missed opportunity for me if I do not invest in such market. So real estate is a big market not just for the developers but also for people who can see opportunity in that area and grab it and this can only be achieved when I use my money to do renovations on some of these properties on ground.

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Many people have properties but they are still poor merely because they are not thinking creatively nor taking advantage of the immense problem of housing deficit and then convert that problem to their own advantage; and that is what our seminars and workshops are all about. We are trying to teach people how they can take advantage of the housing problem in Nigeria. Every problem is clothed with opportunity and how you take advantage of that opportunity is what this is all about.

How would the common man who could hardly save the miniature income earn benefit from this?

There is a scheme we have been doing for over four years now, where by certain people can put funds together to own high quality real estate investments. For example, there is a particular project somewhere in Ikeja that requires about N22 million. Now, if I come together with like 10 other people and together we raise N22 million, we all can buy and renovate that particular property and start enjoying cash flow from it. It simply means that 11 of us will share the profit based on the returns we get per year. That is what we are currently offering people right now, taking it to the market place, so that people can take advantage. We have already people buying into the idea and investing in real estate.

This also means that if I want to invest in a property in Lekki, I don’t need to have all the money for the property to invest in it, but it simply gives me an opportunity to invest in high quality real estate investment that may take me so many years of savings to be able to invest. So, we don’t just want to make opportunity for only those who can afford to buy plots of lands to make money, we also want those who have little means to also be able to invest in properties and make money. Why is it that it is easier for plumbers to own houses while a banker remains a tenant for a very long time? This is so because the plumber is thinking in terms of cash flow while the banker is thinking in terms of building and owning and so he waits for so long till he is able to save a huge amount to buy or build a house.

This is information that people in this sector may hardly want to give out so freely. So why and how are you doing this?

I have been using every platform available to me. I have been using the social media a lot to create awareness and I have been crazy about it and I know a lot of people that have taken this raw information and duplicate it for their own benefits and presently are having numerous properties around town.

This is to tell you that this actually works. It is better we cover this nation with success than preventing people from being successful because a lot of people have success but hide the secret of their success from others. The real estate market is too wide for me to hide anything. We have over 17 million people having housing problems in Nigeria; even I alone cannot serve half a million people. The market is too wide so there is no need for competition.

We hold seminars regularly on this. We just concluded one last week called the Rental Income Plan. It is all about helping people to understand how they can do these things on their own. People can be part of this by registering on our website, www.afping.com. We are thinking of holding these conferences at least once in two months, where we gather people in a class to learn. They don’t have to be real estate experts but those who are ready to take the opportunity in the real estate sector.

Husband and wives can also take advantage of this. We also do one-on-one training, leading people by their hand and helping them to explore the real estate market. And if someone says he doesn’t have the time because he has a regular job, then he/she can invest with us and grow with us. And investing in real estate is predictable, tangible and indestructible. That is why I am inviting everybody to do it and you don’t necessarily have to invest with me, you can do it on your own. I started doing this when I didn’t even have full information about the sector but for the fact that I had opportunities. So those whose eyes are opened to opportunities can take advantage of the real estate market.

How do you guarantee security for such investments and is the training free of charge?

Some amount of money is attached to the trainings because we bring in experts to coach these people. And the training one gets involved in also determines the amount one pays. When it is a class, that is a group of people, we give discounts. So the fee ranges from 50,000-750,000 naira depending on which class you want to attend. We also do executive class whereby after the class, you can pick a particular property and we would guide you by the hand, that means that we would follow you to where the property is, secure the property, negotiate the deal with the property owner and then show you by example how we do it.

And talking about security, we have, in the last seven years, been privileged to have sold more than 2,000 plots of lands; so what we do is that the same way we secure people’s property is also the same way we secure people’s investments. So you are not investing into any real estate project that is not insured. We are working with several insurance companies to ensure that people’s investments are secured and that they do not lose their investments in case of negligence on the part of the developers. So that is one of the ways we are guarding against people experiencing loss in their investments.

This Day

FMBN, NHIS, PenCom AND PENSIONERS

The Federal Mortgage Bank of Nigeria (FMBN), the National Health Insurance Scheme (NHIS) and the National Pension Commission (PenCom) are three major institutions that have profound influence in the way the welfare of Nigerian workers, retirees and pensioners is shaped.

The three institutions share certain features in common: one of the features is that Federal Government employees are automatically enrolled as contributors to the pool of money meant to make it easier for them to meet their need for housing and basic health care while still in service, and periodic pension payments on retirement, respectively.

The amount of money deducted from the salary of each worker as contribution to each of the trio is decided without any consultation with the worker. This feature, which negates the principle of participation, is also common to the three organisations.

The decision on how and when any worker can benefit from his own money deducted and lodged with them ostensibly to further the welfare of the worker is left to the three powerful institutions to choose. This is another shared feature.

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To illustrate, the Federal Mortgage Bank of Nigeria may only advance loans to a worker to build or renovate or purchase a house when its management deems fit to do so, not necessarily based on the urgency of the need of the worker to have accommodation. Likewise, the NHIS, in addition to severely limiting the type of health care accessible by workers, it totally denies retired contributors access to its services regardless of the extent of their need for such services.

They are denied, even at the point of death. On its part, the National Pension Commission is supposedly constrained by the Act establishing it to pay Federal retirees a single kobo out of their Retirement Savings Accounts, even in the face of starvation, except after the Benefit Redemption Fund is activated in favour of the retirees. Some people perceive this arrangement as absurd.

The way and manner the three institutions operate need to be tampered with a human face; with empathy and in the context of the spirit of the humane intention that justified the establishment of each of the three institutions.

While the PenCom was busy earlier this week talking to Directors of Pension Operations, frustrated retirees under the Contributory Pension Scheme, which the Commission oversees, were crying out loudly for attention and payments of their pensions in several states of the country. So unsettling.

In the case of the Federal Mortgage Bank of Nigeria, its Managing Director told State House Correspondents after his meeting with the Vice President of Nigeria that a fresh approach toward facilitating house ownership has taken off, thus raising hope on future housing projects for thousands of beneficiaries with zero equity subscription. This is a good initiative, but the reported case of 2017 and 2018 retirees who are still patiently waiting for the refund of their contributions to the National Housing Fund (NHF) by the FMBN should be treated with the urgency it deserves. September is especially significant as school children resume, and the refunded money can be handy for many in paying school fees.

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The sum total of this article is that the Acts establishing the three institutions, which came into being to preserve and advance the welfare of their contributors, should be usefully flexible: in the case of the FMBN the zero equity approach is good, the rent-to-own concept is wonderful with lower interest charges; the NHIS establishment Act deserves amendment to extend access to basic health care to pensioners who were contributors. The PRA 2014 should be revisited to make it possible for retirees to access part of their savings while remittance to their RSAs from the Benefit Redemption Fund is processed.

The three institutions should be the drivers of the process of making their operations flexible in the interest of their clients.

Salisu Na’inna Dambatta

 

Buyer apathy threatens Abuja new estates

…developers see positive prospects, say prices to rise soon

Many new private estates in Abuja face poor patronage due to perceived high cost, a Daily Trust survey in the sector has shown.

The findings showed that the rate of sales of estate flats that has remained low despite flexible payment plans and juicy discount rates to attract potential buyers.

As such, some of the completed estates spread across the city have remained unoccupied with many more still under construction.

Low and middle income earners in the capital city for whom these new estate homes are supposedly targeted, lack the financial capacity to pay for the houses. A lot of them prefer, instead, to acquire land in the outskirts of the city, which they consider cheaper.

But a cross section of marketers, promoters and estate developers interviewed said they are not disturbed by the current rate of  low sales.

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The  survey carried out within the central part of the FCT metropolis, Lugbe, Apo, Kubwa and Karmo, showed that over 20 new estates have either been completed or are at various stages of completion in the last three years.

Urban Shelter Limited, a key player in Abuja’s real estate market, made up about 30 percent of the new residential developments in the FCT surveyed for this report.

One of the estates, Bellevue Residences, located in Life Camp, according to the company, is an “opportunity to respond to the socio-economic needs of the people by creating a privileged, safe and accessible residential development.” The price for a five bedroom villa at the residence goes for N150 million while a four bedroom town-home costs N70.5 million.

The price range for a home at its 30 apartment’s Lugbe estate begins from N9.5m. A two bedroom semi detached terrace apartment at its Sarauniya Estate Lugbe, which are at the building stage, cost N17.5m under a two-year payment plan.

A marketer of the estate said a subscriber who is unable to meet up with the two-year plan can opt for five-year plan but at a total cost of N22.75m.

Prices for a home  begin from N12m at The Brick City View, another member of the Brick City family in Kubwa.

The cost of an apartment at The Brick City Spring, an affordable luxury homes, situated in Jabi District begins from N9.5m, same as Brick City Valley estate along Kubwa-Zuba express way.

Prices start from N4m at its Kyami Estate, close to the Nnamdi Azikiwe International Airport.

Dantata Town, is another fast rising  estate developers in the FCT promoted  by Dantata Town Developers Limited, a real estate/construction firm. At the moment, it is marketing its newly developed Dantata Housing Estate Kubwa phase 1, 2 and 3 as well as the Dantata Mabushi Terrace Housing Estate in Mabushi Abuja in addition to those in Gwarimpa.

A two bedroom semi detached uncompleted apartment goes for N13.5m while the completed counterpart is N19.5m and an interested buyer is expected to make initial deposit of 30 per cent of the total cost, to spread the balance in instalmental payment.

Other ongoing estate developments surveyed included Brains and Hammers estates Apo 4-5 and Games Village, Flourish Estate Lugbe, Didi Estate Karmo, Park View Estate opposite Games Village, Kukwuaba where a  well finished, fully detached 5 bedroom luxury duplex goes for around N150m.

Some estates marketers, who spoke on the rate of subscription, however, said demand for estates is high because of the corresponding high demand for housing in Abuja due to the influx of people into the city.

“Many people have subscribed or have started buying,” said a representative of Urban Shelter Limited who markets Sarauniya Estate, Lugbe.

“In four months’ time the prices will even go higher because demand is high,” he said.

A marketer for Dantata Town Estate in Kubwa said there are now about 800 residents within all the phases in the estate.

However, some federal civil servants interviewed said the price of an average  estate home for workers on levels 8 to 10 was beyond their reach, and above the Federal Mortgage Bank Housing loan. But the developers blamed the high prices on cost of imported building materials as well as local ones.

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“The cost of land, building materials and logistics is actually why the cost is high,” said a developer who doesn’t want to be named.

Some developers said they are upbeat that the market will pick up particularly as the 2019 general elections draw near.

“After the 2019 general elections, the expectations are that new members of the National Assembly would buy personal houses in Abuja and likewise their aides.

“There might be new set of ministers, MDs and DGs who may be living outside Abuja before their appointment and by their appointments may need new homes. If the purchase of new homes does not rise by then definitely rent will increase,” he said.

By Daniel Adugbo & Malikatu Umar Shuaibu

 

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