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Govt needs to fully regulate real estate operations, says Wamakko


Alhaji (Dr.) Aliyu Wamakko is the President, Real Estate Developers Association of Nigeria (REDAN) and Chairman, JEDO Investment Company Limited. He spoke to the Property & Environment Editor, CHINEDUM UWAEGBULAM on how to revamp the housing industry, curb corruption and access long-term funding in the real estate sector.

The housing sector lacks accurate data, and is also witnessing instability of government policies. How has this affected property investments in the sector?
THESE issues have affected the housing sector so much. We in REDAN are working with 15 agencies and institutions, among them are; the Central Bank of Nigeria (CBN), German Technical Cooperation (GTZ), Family Homes Fund (FHF), Nigeria Mortgage Refinancing Company (NMRC) and Value Chain towards setting up a national real estate data bank, which will drive the process. For now, there is no accurate data and when there is no data, there would not be any meaningful development in the country.


This has prompted REDAN to open branch offices in all the states of the federation, including the Federal Capital Territory (FCT). We have over 5,000 registered corporate members and zonal offices as well. All these things give us a leverage to gather data on housing development within the country.

We have also carried out data survey in some states, precisely in Calabar, Cross River State. We were able to find out the housing status and demand in the state, for instance, the people that may benefit from any housing programme and government’s policy, especially now that the low and medium income earners are left behind in housing schemes. We all know that high-income earners have been taken care of in several projects and their demands have been very slow. Right now, there are so many vacant houses in Abuja and Lagos, because they are not affordable to low-income earners.

The real estate sector is still largely decided and controlled by government, which undermines its growth and development in the global economy. How can government revamp the housing sector to enhance private participation?
There is no economic prosperity for any country without it being driven by the private sector. REDAN as, an institution, should have the blessings of the government. The government should institutionalise the body so that it becomes an avenue to drive polices and generate data.


The government has already intervened, in agriculture, healthcare, and entertainment industry; but government has not provided assistance in housing development, which is key to growing the economy and the Gross Domestic Product (GDP). Apart from agriculture and health, the next thing is shelter. There is no intervention on the basis of shelter and its provision for the citizens. So, we’re calling on the government to institutionalise REDAN. We have already submitted a bill to the National Assembly, so that we will have an Act that guides us. It is through this bill that we want to ensure Nigerians have value for their money and be able to regulate real estate operations in Nigeria. There are so many people that are quacks within us and we want to ensure there is coordination within government, so it can regulate these activities. It is only through this kind of synergy that the institution can be regulated and stand the test of time.

The government can’t do this business without us; its role is to provide an enabling environment for the real estate sector to prosper. Recently, I received a letter from the state security services, Special Control Unit Against Money Laundering (SCMU), which is an arm of Economic and Financial Crimes Commission (EFCC). They want to ensure that each estate on ground has a signboard indicating the owners of the estate. Our research shows that several buildings spring up without any information about the consultants and owners. All these things are an act of corruption, and for us to come to terms with the provisions of the Money Laundering Act of 2011, there must be this kind of intelligence synergy in the country. Developers are supposed to report to SCMU on their activities monthly and yearly. Once we cannot identify who owns what, it is difficult for government to curb corruption in the country. That’s why we are synergizing with SCMU and security agencies to make it mandatory for property developers to be part of our bill.


Currently, the real estate sector is undergoing serious cash crunch. Many developers have several houses for sale but have no buyers for them. What steps have REDAN taken to ensure developers have access to long-term funding?
Let me emphasize again that the government is supposed to provide enabling environment, but if we build these houses with our own hard earnings, provide infrastructure, and pay taxes when due, there is every reason for the government to understand that this sector is very important. There is no sector like real estate in economic recovery and revitalization, because it would provide jobs. We don’t have incubation period, when any intervention is given to us.

For instance, if we are to build one house, we will be able to provide employment to 25 people. The government should understand these facts and provide intervention for the sector. Now, the only window we have is the Federal Mortgage of Nigeria (FMBN) but the bank is being overloaded as its capital base is about N5billion. Consequently, FMBN has not been able to assist us because it has about five million Nigerians contributing to the National Housing Fund (NHF) and cannot cater for five per cent of these people. It is only when the bank came up with home renovation loan that it was able to raise the number of beneficiaries. We have been asking the government to recapitalize FMBN so that we will be able to access funding at one per cent interest rate.

When this is done, those of us in the supply chain of the low and medium income earners will be able to provide homes for rent to own houses to civil servants and NHF contributors. We are still calling on the Federal Government to provide intervention fund at single digit interest rate for us to make the supply chain vibrant and provide affordable housing. I can’t go to the commercial banks and take loan at 28 per cent interest and you expect me to provide affordable homes.


There has been a protracted debt crisis involving some of your members, which the Federal Mortgage Bank (FMBN) alleged to be over N11.24 billion.  What have been the issues? What’s the position of REDAN?
The criteria in FMBN are that for a private developer, it is stipulated that you must have REDAN registration before accessing a loan. But the unfortunate situation is that there were political loans, and we were not informed of such loans. We have corrected that anomaly now, and anytime FMBN is giving our members loan, we will be informed formally so that the association can follow up with the beneficiary. That’s why we have institutionalized what is called Estate Endorsement as a segment of our operations. It enables the association to visit the applicant’s proposed estate and make report as well as ensure that before any money is disbursed to the developer, there will be a site report from REDAN.

What has been the relationship with Shelter Afrique and Family Homes Fund, regarding the challenges of finding construction financing for private developers?
We have signed a memorandum of understanding with Shelter Afrique, a pan African bank to bridge the gap in funding the creation of houses in member countries. Unfortunately, Nigeria could not pay its counterpart funding. There is over $11 million debt that is supposed to be paid. Good enough, with FHF coming on stream, we have initiated a programme, and we will soon reach conclusive stage for creating a 100 housing unit in each of the 774 local governments in the federation at a single digit interest rate, which will provide jobs for 2.5 million Nigerians. The project would start before the end of the year. We are closing our agreement soon and the project would be launched either in Kaduna, Kwara or Ogun and run simultaneously in all the states.


With the cost of construction rising due to the coronavirus pandemic, do you think your target for the year is achievable?
That’s why we’re collaborating with the Building Materials’ Producers Association and we have written to CBN to provide some sort of incentives to the manufacturers of these products so that they can produce the materials at a lower cost for us to provide affordable housing projects. For us, the only way to curb issues of COVID-19 is for people to have jobs.

Some of your members have been victims of various demolitions in different parts of Abuja, with the FCT authority alleging illegal construction on buffer zones and without building approvals. How is REDAN intervening in these matters?
In a normal situation, if you see a building being pulled down, it is not being demolished for sheer hatred; there must be a reason. Some of the deviants are not our members, because our members are educated and are aware of existing laws in the FCT and won’t dare go contrary to those laws. Those whose buildings have been demolished were given several warnings but they refused to adhere to them. That’s why their buildings are being demolished, but anybody who has a genuine case, and has his building approval would not suffer such fate. The FCT administration won’t touch the building. I was with the minister recently, and the association later held meeting with FCT authority, he assured us that they will never dare touch the building of anybody standing tall with the rules and regulations.

As the new president of REDAN, what is your mission for the association?
I want to engineer an association that is a regulated institution to boost private sector-driven economy. I’m making efforts to establish a project that will keep my members busy. Our membership has been growing daily due to our commitment to make them prosperous. We will continue to defend the integrity of our members and savings of Nigerians who are working to increase the housing stock.


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