‘FG needs to make housing finance within reach of Nigerians’
In the 60s, when the Federal Government acted to ensure that enterprises was not monopolised by foreigners, some Nigerians with an independent estate agency were absorbed into their firm to enhance their expertise in the field of estate surveying and valuation. So, working out of a tiny office in central Lagos, the Knight Frank was born, and this year, the company is celebrating 50 years in real estate business. In this interview, the Senior Partner, and Chief Executive Officer of the company, ALBERT ORIZU spoke to CHINEDUM UWAEGBULAM on housing related issues and advised that government should assist low income earners own their own houses by creating satellite towns.
VOLUMES of good quality commercial and residential real estates have been completed in major cities like Ikoyi, Lekki and Victoria Island in Lagos and other major cities, but buyers seem to be scarce. What steps should be taken by developers to sell of these properties?
They should ensure the properties are tastefully finished to the highest standard. Then, the owners should also make use of professional estate agents in the marketing of their various properties and the pricing must be right.
Nigeria population has been on the increase, do this create demand for residential property, ranging from affordable housing to high-end luxury property?
Population does create demand for residential property. You find out that our population of 170 million is such that about 40 million of these group of population are within the income bracket of over N1 million per annum. Off course, they need to do businesses in a better environment, so, we have the demand. The demand is there, and also you find out that our economy is booming, attracting foreign investors to Nigeria. All these have created demand in both residential and commercial property presently. This have also encouraged some new developments that are coming up the city of Lagos, like the Eko Atlantic City, a lot of purchases have been made there. If that demand is not there, there won’t be enthusiasm among the investors to put their money in real estate. Obviously, an effective population plays a major role in real estate, with a reasonable income bracket being able to take up houses and office spaces for their businesses.
The outlook for Nigeria economy has been clouded by the steep fall in oil price that started in the middle of 2014 and continued into 2015. Has the dip in oil prices affected the property market?
Somehow, you know, because of the fall in oil price, some oil companies are no longer expanding the way, one expect in their operations. Off course that will give rise to a short fall in their demand for prime commercial property for staff as the case may be. But our economy is being diversified to bring in many key players from all sectors into the market place.
Presently, the retail aspect of the property development is booming, encouraging expansion of South African retailers such as Shoprite into Nigeria. Has this development created new opportunities in the property market?
Yes. The retail sector of the economy is coming up fine. Now, you find out that there is the growth of the middle income class. The middle class in Nigeria is quite large and they have the purchasing power; and trends are also changing on how people do things earlier than now. For instance, there is a great potential in urbanisation in Nigeria. Most of the people are coming towards the cities and modern ways of doing things are being fancied by the middle class. These are people mainly patronizing the various retail projects that are coming up in virtually in all Nigerian cities such as Owerri, Ibadan, Abuja and Port Harcourt. That accounts for the fact that they are creating a great opportunity for investment in that area and people are taking good advantage of those opportunities.
There is still considerable room for further development, and a number of local operators such as Artee Group are seeking to roll out smaller mall concepts across Nigeria. UACN also has entered the retail mall sector with the development of Festival Mall and Victoria Mall Plaza, while Heirs Holdings and LSDPC are redeveloping Falomo Shopping Centre. Abuja has also started to see increase in mall construction, most notably the 30,000 square meters in Jabi Lake Mall.
Are these new malls not hindering the growth of street shops, and rendering some shopping facility vacant?
Actually, every market has its own segment or buyers. Everybody cannot buy from the same place. Each market gets its own patronage.
The housing industry challenge is enormous and traverses the building materials and mortgage services, what is your advice to the incoming minister of Housing and Urban Development on how to better the sector?
There is need for mass housing, the new government should look into part of suggestions being made by professionals on how to revive the nation’s housing sector, especially providing affordable housing for the masses or low-income and medium income segment of the society.
Secondly, there is need to make housing finance within the reach of an average Nigerian. Thirdly, things that relates to the acquisition of titles should also be made much more accessible, without bureaucratic bottlenecks such that housing developments will be less cumbersome for any Nigerian planning to have shelter over their heads.
They should look at the provisions of the Land Use Act, remove the bottlenecks that makes it difficult to implement, and ensure access to land and housing finance, so that developers and individuals can get loans at affordable, reduced or single digit interest rates.
There is also need for government to take up initiative to create new towns and satellite towns, but the new schemes should be able to provide infrastructure and services for the catchment of people living in a particular area in terms of providing offices and residential accommodation, medical care, and all necessities of life without traveling out of the towns and long distances to get the services.
Lastly, Knight Frank recently marked its 50 years anniversary, what are your plans for the company in the coming years?
Knight Frank as we met it has grown beyond bounds; we 21 offices in nine African countries and worked for several state and federal governments, high nets worth individuals and corporate organisations. Presently, we are looking at participating more in all sectors of the economy, and are in a position to render first class services to the real estate sector.
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