Kingsley U.N. Chikwendu —
At the Real Estate Discussion and Awards Forum organized by Thinkmint Nigeria in Lagos, the Managing Director of the Federal Housing Authority (FHA), Sen. Gbenga Ashafa said the emergence of new risks in the country pose new threats to real estate investment and added that despite the threats, the sector remains an asset of choice for investment as growth and opportunities in other subsectors are expected.
The former lawmaker also said that the risks include insecurity, political changes in government policies, extreme dependence on natural resources/lack of economic diversity and unpredictability of local currencies against the dollar.
The forum which featured the presentation of Lifetime Achievement Awards to the Minister of Works and Housing, Babatunde Fashola, Real Estate Woman of the Year to the Chief Executive Officer of Urban Shelter, Saadiya Aliyu, Special Recognition Award for the Growth and Development of Nigeria Real Estate Industry to the Managing Director of Nigerian Mortgage Refinance Company, Kehinde Ogundinmu and Real Estate Man of the Year to Babajide Odusolu of OCTO5 Holdings Ltd, also had other awards like the Young Real Estate Person of the Year, Luxury Project of the Year and Real Estate Investment Advisory Company of the Year presented to Babajide Adekola of HomeWork Development and Properties, Azuri Towers by Eko Atlantic and Northcourt Real Estate respectively.
The General Manager, Procurement at the FHA, Mr. Thomas Anetor, representing the Managing Director, Ashafa, expressed that the Certificate of Occupancy for property development is a long-term lease, subject to all kinds of terms and conditions, stressing that there are usually issues of transparency and duration of processes and transfers.
This problem, he said is compounded by the fact that majority of land registries are still manually operated.
“High costs of acquisition and construction, these are as a result of high costs of building materials, high costs of skilled labour, multiple taxation, poor or non-existent infrastructure”, he said.
“Demand on retail properties such as malls which had been adversely affected by the effects of Covid-19 is likely to pick up, albeit slowly, due to the economic downturn. In the long run however, demand will pick up with some adjustments such as online shopping, increased use of retail apps.
“In the Industrial sub-sector, demand for more warehouses and logistics will increase due to the impact of COVID-19 and the shift from physical stores to online shopping.”
The demand for bare lands, he said will increase due to shifts across the subsectors, adding that there would be a preference for mixed use development, which will be guided by the increasing demand for high quality technologically driven and eco-friendly environments.
He also advised that investors should explore the potential for local partnerships as such partnership could also bring local expertise to help identify and overcome difficulties in doing business in the local environment.
“The Federal Housing Authority, which is the most visible representative of government in the Housing Sector, has a vibrant Partnership Department through which about 20 per cent of our products are rolled out. We look forward to having you as Partners as we look to open more projects countrywide, especially FHA’s Abuja New City, which is envisaged to sit on over 700 hectares.”