Dr Victor Onukwugha is the Executive Chairman of Bauhaus International Ltd, a a real estate group that is involved in real estate development, development facilities and management. It also renders services in architecture, engineering and government consultancy. In this interview with Viewpoint Housing News in Abuja, the Executive Chairman suggests ways government can assist developers to develop low income houses for the masses.
Viewpoint: How has business been in the past three years?
Onukwugha: The last three years in Nigeria! The economy has not been the same since there is no developed mortgage system in Nigeria. Many people can’t buy your products even though they actually need them. But in Bauhaus, we have been lucky that some of our buildings are still appealing to those that are in the position to buy.
Viewpoint: What inspired you towards establishing Bauhaus?
Onukwugha: First, starting with the name. Bauhaus is a movement. In the olden days, Bauhaus means building in German. I’m a graduate of architecture and if you study architecture, you will get to study about Bauhaus.
We decided to go into quality buildings which was what the Bauhaus study stands for those in days. We couldn’t hesitate to adopt the name. I have done architecture in terms of design and building construction and when you combine design consultancy with building construction, the next thing is to go to the next level which is real estate development.
These days, a lot of people call themselves developers. It looks like it is an all-comers business but it is not. It is meant to be a knowledge-based business because once you are a developer, it involves so many things. From designs to funds sourcing, land acquisition to marketing and some legal issues.
Beyond being an architect, I also trade as a real estate developer. I schooled at the University of Nigeria Nsuka. I studied Architecture and Management at the University of Lagos. I also went to Harvard’s and studied Estate Development and the School of Design in Harvard’s. Beyond practising, I am also a certified estate developer.
Viewpoint: what are the challenges you have faced in these past years?
Onukwugha: First and foremost, real estate development is an exciting business I must say. Everything you do gives you new experience. The major challenge has to do with finance and our finance is at four levels: one, Development Finance for the developer himself; two, Purchasing Finance which is by way of mortgage of buyers; three, land acquisition process; and four, International Funding and international participants will also come in as stakeholders.
Viewpoint: Developers appear not to be interested in low income housing where as there is shortage of accommodation for those categories of people. What do you think can be done to make developers build more low income houses?
Onukwugha: Government policy. There is no place in the world where a developer goes into low cost housing; it is also called social housing. All what government needs to do is to encourage developers by creating a social housing scheme and what they do by that is if a developer gets his money/loan and prices his houses appropriately, how many people can buy houses at the cost of N2 million? Very few but if the government tells developers we are going to buy your low cost houses for a specific amount, government should pay the developers then subside it for the low income earners so that developers can build more.
Developers cannot create mortgages. Any developer that decides to create mortgage will be stuck. A real estate developer cannot build a house and sell it lower than the cost spent.
Viewpoint: Three years ago, before the APC government came into power they promised building one million housing units. As a stakeholder, can you say this has been achieved?
Onukwugha: So many promises were made including making N1 equivalent to $1. Government can’t fund that alone. That is why they need to create environment for developers to come in and assist. If the government actually wants to achieve this, it should create an enabling environment and reverse land acquisition process or even get lands and give to developers to come in and do the infrastructure and also ask them to do the building shells. With that, the government will be able to meet up to its targets.
Viewpoint: There has been a lull in the real estate market. How are estate developers coping with this?
Onukwugha: It is rough! The economy has been bad for all sectors. The hierarchy of needs for any human being is food but I think shelter should be the first. For me, the real estate developers have been going through rough times because there has been low patronage.
Viewpoint: As a member of the Real Estate Developers Association of Nigeria (REDAN), what could you say is the relationship between the Federal Ministry of Works and Housing and REDAN?
Onukwugha: There should be a synergy between the Federal Ministry of Works and Housing and REDAN. REDAN is meant to set standards for its members which must be abided by.