• As Lagos super mall gets December completion date
Following increased challenges in commercial real estate, especially in the retail segment of the market, a property developer has called for the establishment of an energy bank, which will finance, and support private businesses to invest in the energy sector.
The Chairman/Chief Executive Officer, Median Infrastructure Development Company Limited, Mr Olumide Akinsanya, who suggested this, advised commercial banks to form a consortium to bankroll ventures that will alleviate problems facing the industries and entrepreneurs.
He revealed that one of the biggest challenges bedeviling the shopping malls is energy. “We have subsidised the electricity. Over a period, we paid about N300 per kilowatt unit for the tenants. But at the end of every month, we do not recover enough to pay Discos and buy diesel. So, we end up subsidising. That is when diesel was N800. We have not increased that price despite diesel being N1,600,” he said.
According to him, investors recognise the opportunities that exist with value-add real estate and continue to chase markets with strong tenant history, while lender for retail real estate has become more conservative, and money moving into the system comes with a higher cost of capital due to cautious lending on retail assets, which is a long-term finance.
Akinsanya, whose firm is, versed in the development of prime shopping malls, such as Owerri Mall, Delta City Mall, Asaba Mall, Uyo Mall and the upcoming Super Mall with a lettable area of 5,800square metres, said the company has built over 40,000 square metres of lettable space at the different malls.
According to him, despite growth in rents and new revolution in the mall industry, the number of malls is still inadequate to meet the needs of the 200 million Nigerians. “While the return on investment is good on commercial real estate, the ticket investment required is huge,” he said.
Akinsanya stated that another major challenge crippling the sector was the exchange rate as some foreign investors exited the Nigerian market due to issues bordering on repatriating of their funds. “Even when you now earn in naira, you cannot exchange it in the official market and remit your loan back. So, you are taking dollar loan, you are earning naira, and the currency is going down, while the dollar goes up in terms of the value. So, it has been a struggle in that aspect,” he said.
He said the local investors are devising their own ways of ensuring investment in naira is sustainable, while revealing that some financial institutions have examined their model and are ready to support their initiatives. “We have devised our model to continue to be in the market and offer people quality service that they deserve. We are currently ensuring that people buy stores and deliver a debt-free asset.”
Meanwhile, Akinsanya disclosed that Median Infrastructure Development Company agreement with Wemabod Limited for the redevelopment of over 4, 426.45 square meters of land, formerly known as Super Cinema or Super Plaza along the bustling Akerele Road, Surulere, into the proposed Super Mall is still on course.
He added that the project has an April 2025 completion date; however, the promoters plan to complete the four-floor mall ahead of schedule by December this year. The Super Mall project was conceptualised in 2020, generally due to the absence of modern formal retail channels in Surulere and its environment. The mall was born out of the desire to create a destination point for Lagos State residents to have an experience of a formal shopping mall.
According to him, Median Infrastructure is redeveloping the property into a modern edifice that will cater for the commercial retail and entertainment/ recreational needs of its captive environment and the entire Surulere community. Currently, the developer is offering prospective owners shops for a 50-year lease agreement at N4,000 per square metre.
Akinsanya said the joint venture development is expected to be a retail and commercial mall, comprising shops with prominent anchor tenants, pharmacy, cinema, lettable office spaces, food court, restaurant and bar, lounge, line stores, and outdoor terraces. The mall is user-friendly and takes into cognisance access for the disabled and is designed to minimally reduce touch surfaces interaction.
It has parking for over 100 cars and access to the site is easy from both the University of Lagos end and the Surulere Stadium end. He revealed that Market Square, one of the fastest growing retail outlets in has been picked as the anchor tenant, while other notable brands have signified interest. “Grocery stores as anchors are winding down in retail. And we need to start looking at what keeps people in the mall, and we are focusing on entertainment and children’s playgrounds now,” Akinsanya said.
Anticipated facilities include 100 car parking lots, sewage treatment plant, water treatment plant, fire alarm and firefighting system, 24/7 CCTV surveillance system, armed Police Patrol, Independent Power Plant, and retails shops. Other attractions are the food court and Cinema house.
The mall, when completed, is expected to further stimulate nightlife and commercial activities in the environment. It will also provide thousands of jobs for the formal and informal sectors, as well as stem the tide of unemployment within the society.
