The Nation Newspaper

Category: Building & Properties

  • Real estate: The challenges ahead

    Real estate: The challenges ahead

    The real estate sector is estimated to hit  $13.6 billion this year, accounting for 7.6 per cent of the gross domestic product. This may be good news for investors, but experts are calling for caution, writes MUYIWA LUCAS

    Renowned accounting and auditing firm, Pricewater-houseCoopers, is usually not known for getting its economic predictions wrong, though with slight variations in some instances usually caused by unforeseen fluctuations in micro and macro economic policies.

    And so, when the firm made its report public that the country’s real estate industry would be valued at $13.65 billion this year, compared to the $9.16bn in 2014, accounting for 7.6 per cent of the country’s Gross Domestic Product, (GDP), it obviously sent  investors and realtors leaping for joy.

    Now, in spite of the sharp downturn in the economy, especially with the naira’s free fall against international currencies, including the fast declining international crude oil price, stakeholders and experts in the real estate industry are still of the opinion that the sector will remain buoyant and full of activities this year.

    But there is a caveat to this: realtors and investors have to be very discerning in their choice, or areas of investment because the sector will respond to both negative and positive economic indices.

    Director, Real Estate Advisory, North Court Real Estate, Tayo Odunsi, agreed that the outlook for the real estate market this year will be largely dependent on the overall performance of the economy as the demand, supply and price of space is contingent on the well-being of occupiers, developers and investors.

    Similarly, the Senior Manager, Real Estate Finance, Stanbic IBTC, Mr. Tola Akinhanmi, at a real estate conference, brought to the fore the need to take purposeful decision in real estate investment this year. For instance, he said there has been growing interest and focus on investment grade assets within the retail and office segments of the sector, in spite of an increased government interventions and support for the housing sector, such as the World Bank-led housing initiatives, establishment of the Nigerian Mortgage Refinancing Company (NMRC) and relative mortgage accessibility through pension reforms.

    A report by North Court Real Estate, titled: Nigeria real estate market outlook 2016, further corroborates Akinhanmi’s submission. According to the report, the office development segment will experience massive boom, with over 150, 000 square metres of lettable space currently being developed for delivery over the next six months to two years. Of this figure, Lagos, the report says, remains in the front runner in this development, accounting for over 25,000 sqm to be delivered. And while Eko Atlantic City gradually takes shape, Ikoyi area would be the prime office destination; Abuja and other second tier cities will follow.

    Investigations by The Nation revealed that high grade office spaces expected to be completed and drive this projection include but not limited to The Wings, a 27, 000m2-luxury office space being developed by RMB Westport and Oando Plc; Lake Point Towers; Madina Tower; and the 26,000m2 World Trade Centre (WTC) in Abuja. Others are the African Capital Alliance’s 6,670m2 “Alliance Place” in Lagos, being developed at a cost of N165 million, and the 15, 734m2 Heritage Place being developed by Actis.

    “The development pipeline has never been so robust; the office development pipeline is very rich. Never has the nation enjoyed such influx of investment office space available for take-up by third parties as against owner-occupation, which was the norm in the past. The invasion may drive prices down moderately; we also postulate that occupiers may surrender leases in older buildings in preference for new builds, which may be willing to offer competitive prices,” the report said. This postulations may not be incorrect given that some developments, such as the Civic Towers and Landmark Tower, delivered in 2015, though had fairly rapid occupation, they nonetheless where rented at rates less than originally desired due to the economic crunch.

    But Akinhanmi explained that in spite of the economic downturn, there was still a strong market in Nigeria’s real estate. This, he observed, accounted for the sector’s emergence as the sixth largest in the country, accounting for 8.4 per cent of the total Gross Domestic Product in 2014, and further growing by 18.78 per cent in the second quarter of 2015.

    “The real estate sector has in the past five to seven years witnessed increased foreign and domestic investment; entry of foreign developers, investors and service firms; increased joint venture arrangements between local sponsors and financial as well as strategic partners; and development expansion into secondary places, such as Delta, Owerri, Abeokuta, Enugu, Ibadan and Kano, among others,” he said.

    Yet, other stakeholders are of the opinion that the residential sub-sector will always have its own demand requiring that the supply gap needs to be covered. Boye Ajayi, a  consultant, explained that in spite of the economic situation, this sector would still be a high flyer because shelter ranks highly in man’s hierarchy of needs.

    Therefore, Ajayi argues, man’s first priority is to get shelter over his head. He, however, said the sector may not experience high brow residential apartments making waves, but there will still be activities in the sector.

    Indeed, experts said going by the events in the beginning of the year, tougher times loom, yet opportunities for success the subsector still abound. They, therefore, advise that smart real estate ideas, including innovation in designs, local content for production, and construction approach; creative funding; and disciplined focus, should be paramount to any investor in the sub sector this year.

    Furthermore, with a seemingly gloomy future for the economy, Ajayi urged that engaging in any development requires more than ever before, proper analysis, adding that Nigerians and investors  seek experts’ opinion before committing resources to any investment this year.

  • Surveyors set agenda for industry

    Surveyors set agenda for industry

    The tone of activities in the construction and built environment in the year may have been set quite early as stakeholders and practitioners at the close of last year, put forth suggestions on how to reshape in the industry.

    The Nigerian Institute of Quantity Surveying (NIQS), at its 26th Biennial Conference  in Lagos,  called for efforts by professionals in various fields to reshape the quality of policies. In specific terms, the NIQS charged professionals, especially those in the built environment, to get actively involved in politics and decision- making in the country.

    Under the theme, “Politics, policies and national development – The role of professionals,” the immediate past president of the institute, Mallam Murtala Aliyu, said the choice of the theme was informed by the way professionals disregard the consequences of ignoring politics, leaving the fundamental aspects of their survival in the hands of persons with little or no capacity to handle such sensitive enterprise.

    The conference afforded built environment professionals, both at home and the international community, the opportunities to discuss issues relating to politics generally, policy formulation and implementation that could enhance national development. There were technical and panel discussion sessions on policy making and economy, accountable politics, effects of regulations on politics of service, the role of professionals, professional bodies and experiences in the construction industry in other countries, such as South Africa, Ghana and Kenya.

    According to Aliyu, professionals should be mobilised to take their deserved position in redefining the direction of the development of the country.

    “The economic challenges facing the country, especially the fall in the price of oil further put pressure on the dwindling income of the country demanding the attention of all expertise in managing the nation’s resources,” he said.

    A former president of the institute, Mr. John Alufohai, noted that professionals could bring about national development when they engage in politics.

    At the end of the event, it was also recommended that Professional Bodies should establish a functional research arm in form of think tank and the outcome of the research made public; to ensure accountability, a central body of professionals should be set up that will monitor and make those in government accountable. The central body is expected to develop frameworks that will make government more accountable to the populace; there should also be the establishment of cost data bank with adequate dissemination of information to all stakeholders.

    Furthermore, the body recommended the adoption of international construction measurement standards , stating that this  would enhance the activities of the industry since Nigeria is said to be next to China in construction activities; that professional bodies should use their expertise to make policies that are feasible.

    In terms of investment, the NIQS recommended that good governance should entail investment locally, while investing abroad should only be in terms of surplus. To this end, it urged government to not only attract foreign direct investment, but should also retain it.

    The conference was attended by a large number of professionals from the Nigerian Built Environment and delegates from South Africa, Ghana, Kenya and Zambia, including Nigerian students. Others include Senator Ahmad Abubarkar (Adamawa South Senatorial Zone and Honourable Biodun Olasupo Adeola (Chairman, House Committee on Legislative Compliance); the past and presidents of the Association of Africa Quantity Surveyors (AAQS), Mr. Michael Frimpong and Prof Rob Pearl and  President of Commonwealth Association of Surveying and Land Economy, Mr. Segun Ajanlekoko.

  • Road construction excites Epe residents

    A Ray of hope is on the horizon for Epe,the big Lagos State riverine community.

    Last week, the state government appointed Messrs Granebury Construction to handle road expansion and rehabilitation in  Epe. The contractor is expected to mobilise to site any moment to kick off the first phase of the job.

    The roads slated for rehabilitation are categorised into two: A and B. Unnder Category A, which are to be completed next year, are Lagos Road, Oke Osho/T Junction, Aiyetoro/ Roundabout; Central Mosque Junction/Orita Marun Stream. Category B comprises Oloja Estate; Bature/ Otunba Adeniyi/Omotayo/Uthman Mustapha and Raman/Ishawu Owolabi.

    However, due to the scope of the project, which will affect some properties, and also require the securing of right of way, officials of the Ministry of Works and Infrastructure, have held a meeting with the community.

    The meeting, tagged: “Stakeholders meeting on the rehabilitation of strategic/arterial/inner roads in Epe Local government,” was attended by traditional rulers, women groups, youth groups, property owners, businessmen and lawmakers from the area. They agreed that the projects should be executed without hindrance.

    The Lagos State Commissioner for Works and Infrastructure, Mr. Ganiyu Johnson, explained that the meeting became imperative because some properties that fall on the Right of ways (ROAs) would need to give way for the project. Johnson further explained that as a responsible government, it would not want to take her citizens for granted or put them through any hardship for no reason. And to serve as a palliative, Johnson assured that there would be  proper enumeration to ensure that those to be affected by the project  are compensated..

    “We, therefore, solicit for the understanding and cooperation of all residents, especially, those whose properties will be affected. We realise that this temporary inconveniences will soon give way to all the conceivable comfort that the project, when completed, will bring to the entire community,” Johnson pleaded.

    The traditional ruler of Epe, Oba Kamorudeen Animashaun, assured of the community’s support for the project. Besides, he explained that with Epe now playing host to several monumental economic development projects sited within its domain, the people had no option than to throw their full support behind the State government.

    “We have Lagos Free Trade Zone, the proposed airport, fertiliser plant by Dangote Groups and others like that. At the end of the day, it is Epe that would benefit most,” Oba Animashaun said.

    Similarly, the Oba of Noforija community, Babatunde Ogunlaja, assured the contractor of enjoying a molest-free engagement during the construction. He urged parents to warn their children to desist from being used to hinder the project.

    “We don’t want the Governor to regret coming to our division with this laudable project. Let us all join hands to ensure that it is successfully completed and in good time,”  the monarch said.

    The Managing Director, SEGSON Nigeria Limited, Pastor Segun Ogunade, who is also a member of the community, appealed to the youth not to see the project as means of exploitation, but rather one that would be beneficial to all.

    ‘’But for a project of this magnitude, it becomes imperative that suitable alternative roads be put in place. This was why the women group called for the immediate rehabilitation of some road portions along Epe-Temu, Imota Agbowa and Isiu axis where there are craters and potholes. Specifically, they want the deplorable state of the road leading from the town to IKorodu to be addressed immediately.

    “We are traders going to Mile 12, daily to purchase our goods, but the condition of the road is appalling. On several occasions, trucks, in the process of trying to avoid potholes, would face un-coming vehicles, which is very dangerous. We plead with the government to, as matter of urgency, patch the affected spots,” Mrs. Khadijat Ibiyemi, one of the women leaders, appealed.

    The Chairman, House Committee at the Lagos State of Assembly, Mr. Biodun Tobun, appealed that the compensation should be paid effortlessly, urging that builders, youths and artisans in  the community be involved the project by the contractor.

  • ‘Make building materials, soil testing compulsory’

    ‘Make building materials, soil testing compulsory’

    Enforcement of compulsory materials testing is necessary to stop the incidence of building collapse in the country, the Managing Consultant, Lagos State Materials Testing Laboratory (LSMTL),  Abel Famakin, has said.

    Speaking at the Eighth Anniversary of LSMTL in Lagos,  Famakin said making materials testing mandatory for new buildings as well as soil test, would reduce incidences of collapse buildings in the state.

    He said since the inception of the Agency, no incident of building collapse has been recorded from any of the certified buildings and materials tested by the Agency, pointing out that non-compliance to building standards and negligence by contractors have been responsible for perennial building collapse in the state.

    Famakin said although the agency is not empowered to sanction  building defaulters, it, in collaboration with  the State Safety Commission and Lagos State Building Control Agency, have over the years, sensitised the public on the importance of materials testing and issued sanctions where necessary.

    He appealed to contractors, site engineers and the public to collect their materials test results to make strategic decisions between the actual result and the expected standard.

    “The laboratory is presently experiencing a backlog of uncollected results which signals that such clients did not pay attention, nor appreciate the importance of quality control and assurance. To this end, we have taken a step further to ease the whole process of result collection by offering the option of result report delivery to clients free,” he said.

    He praised the visionary leadership of the former Governor of Lagos State, Asiwaju Bola Ahmed Tinubu; the then Commissioner for Works and Infrastructure, now Governor of Osun State,  Rauf Aregbesola; the then Accountant-General in the state, now Lagos  Governor, Akinwunmi Ambode and the then Permanent Secretary, Ministry of Works and Infrastructure, now Commissioner in the Ministry, Ganiyu Johnson, among others, for conceiving the idea of establishing the agency eight years ago.

  • WTC Abuja at par with others, says developer

    With the quality and comfort of the World Trade Centre, Abuja, high-end property seekers have been assured of the same satisfaction derived from living in a luxury apartment with the world class amenities in Berlin, New York or Dubai.

    Assuring these  property seekers during a media chat in Abuja, the Assistant General Manager, Corporate Communication, Churchgate Group, Femi Awopetu, said the WTC has been developed with the same quality expected from the WTC brand.

    Awopetu said the fundamental principle of luxury is the capacity to blow peoples’ minds. This, he said, is what the WTC brand is associated with all over the world and the WTC project being constructed in Abuja will not be an exception.

    “The World Trade Centre, Abuja, which will be the first purpose built WTC in West Africa was envisioned with the intent of establishing an elevated lifestyle for Nigerians. Inspiration was drawn from modern cities such as Tokyo, Stockholm, Paris; we believe Nigerians trulydeserve to enjoy the sam amenities and infrastructure without travelling abroad,” he said.

    The World Trade Centre, Abuja, developed by Churchgate Group, is a mixed use development of luxury living, AAA offices, hospitality and shopping that offers unparallel luxury and comfort to those seeking a lifestyle above the rest.

    Construction of Phase 1 is at the final stage, which comprises the residential and commercial towers. The former will offer luxury apartments with modern amenities, while the latter will accommodate businesses of various sizes, with offices ranging from 100 to 1,440 square meters.

    The buildings, at 24-store each, are set to define Abuja’s skyline: the Commercial Tower is the tallest office building in the nation’s capital, while the Residential Tower is the tallest residential building in Nigeria. Future phases include the construction of a shopping mall and a 37-storey hotel, which will be among the tallest skyscrapers in the continent.

  • ‘Housing key to solving youth unemployment’

    The housing sector presents great opportunities for the realisation of the youth employment objectives of the President Muhammadu Buhari’s administration, Managing Director of the Authority, Prof Mohammed Al-Amin has said.

    He spoke in Abuja while receiving the Exemplary Leadership of Excellence Award conferred on him by the Arewa Youth Parliament.

    He said the sector has about 78 housing-related jobs that could take many of the unemployed youths off the streets.

    Al-Amin lamented the shortage of artisans in the various fields of the industry which he said had led to the continued importation of skilled personnel from neighbouring countries to take jobs that should be done by Nigerians.

    He said the government would soon commence the implementation of its housing programme and advised the youths to acquire the relevant skills to make them employable in the sector.

    At the event, which held at the Authority’s headquarters in Abuja, the FHA helmsman said the reform document prepared for the organisation, rather than strengthen it for better performance had risked the Authority’s mandate, especially that of social housing.

    Al Amin said his management team, which came into office 12 months ago, had succeeded in putting the FHA in the right direction and had effected a structural re-alignment of its operational system in line with international best practices and good corporate governance, adding that measures were also introduced to block leakages, check corruption and ensure financial prudence.

    He said the workers had been re-organised in line with the principles of service efficiency and improved productivity while computer automation in documentation and record keeping of the Authority’s assets was also introduced.

    Al-Amin added that the principles guiding partnerships and contracted projects were also reviewed to ensure that the Authority got the best of every deal.

    In its 12 months in office, he said the management uncovered consent revenues worth N2 billion which were yet to be collected and paid to the government.

  • Akwa Ibom to take over street lighting from contractors, says Commissioner

    Commissioner for Works in Akwa Ibom State, Mr Ephraim Inyang, has said the state government may take over the powering of street light contracts hitherto handled by contractors.

    Inyang said this would be done to ensure that Uyo, the state capital as well as other major towns across the state are properly lighted up at night for security reasons.

    Inyang, who spoke in Uyo while reviewing the activities of the Ministry, said the step would be taken unless the contractors replace all ageing generators they are using.

    Explaining why most of the streets in the capital city are in darkness, Inyang said: “What we saw when we came on board was a situation where generators were used. These generators were owned by contractors and they were not willing to maintain them. “So, you see a situation where we supply diesel to the generators by 6pm and they are supposed to be on till 6am. But, after these generators, which are not in very good condition, has worked for three to four hours, they trip off; the entire area goes into darkness. And for that reason, I have refused to approve payment to them since I came on board, which is one of the things they use against some of us because I am insisting that you give me value.”

    The commissioner said he will not continue to approve payments for something that has not been done to give the  state value for her resources. He insisted that the era of ‘running  government because it is  government’ has gone adding that government should be run as an entity where all operators have a responsibility to give account.

    He said if the lighting position in the state must be changed, then government must take responsibility of those generators or the contractors replaced them.

    On why the state has not switched-over to using solar system which is cheaper to maintain,  he said the state is already working on that. He noted that though solar system is more economical at the maintenance level, it is more expensive at installation.

    “At the installation, solar is more expensive. At the maintenance point, it is cheap. So, you need a whole lot of capital to install solar but after installing it, you do not have an issue,” he said.

    He explained that there will be financial crisis if the government wants to replace all the street lights on all the old roads in Uyo with solar lighting system at one fell swoop.

  • NIOB, CORBON push for passage of Building Code

    The President, Nigerian Institute of Building (NIOB), Mr. Tijani Shuaib, has decried the non-passage of the National Building Code (NBC) draft bill sent to the National Assembly (NASS), since 2006.

    “It is quite unfortunate, that since 2006 that the draft bill of the National Building Code (NBC) was sent by the Executive to the National Assembly (NASS), not much had been done by the body to pass the bill. This development has continued to be a source of concern for the seven professional bodies in the built environment,” he told The Nation.

    Shuaib, however, disclosed that the NIOB and the Council of Registered Builders of  Nigeria (CORBON) have commenced fresh moves to actualise the passage of the Bill. This, he said, involves impressing it on the relevant authorities and top government officials, the importance of the bill hence, the need for it to see the light of day.

    The NBC draft bill has undergone the second reading, and awaiting the third reading before being committed to the committee stage.

    Expressing optimism that the Senate would expedite action on the bill, Shuaib said the early passage of the NBC would help in sanitising the construction industry.For instance, it as it would serve as a document to regulate workings in the construction industry and also help to define the duties of all the seven professional bodies in the built environment to avoid the frequent conflict among them.

    The NIOB helmsman regretted that the country has witnessed several building collapse in the last two years, a development he attributes to greed on the part of most developers and the use of sub-standard and inferior building materials. Most developers, he further explained, in a bid to maximise profit choose to cut corners, hence jeopardising the lives of the ordinary people. For instance, where a developer is supposed to use one bag of cement to produce 35 blocks, he would rather use same to produce 60 blocks. This development, no doubt, would be detrimental to the finished product.

    Besides, Shuaib identified quackery in the sector to be in two folds – intra and extra quackery. Intra quackery, he explained, involves genuine professionals. For instance, if an architect whose job is to design a project goes ahead to supervise its construction after his drawing, even though he is not a trained builder. Likewise, he said, if a builder decides to evaluate the cost of a project when he is not a quantity surveyor, then he automatically becomes a quack because that is not his area of specialisation.

    On the other hand, the extra quackery involves a non-professional who engages in the building process without any form of certification by a recognised professional body. This, he noted, is the worst form of quackery that is bedeviling all the professional bodies.

    This development has led to the establishment of the Association of Presidents and Registrars of Built Environment Professionals (APRBEP), which tries to ensure compliance with guidelines for all the professional bodies in the built sector to avoid conflicts.

    Also, developers, Shuaib said, should engage the services of professionals. “We as an institute would continue to canvass the use of genuine professionals in supervising on-going projects. There is the need for developers to use genuine and standard building materials for construction and finally anybody found culpable should be severely sanctioned,” he said, adding that in the last two years, no builder has been involved in any of the collapsed building that were witnessed in the country.

  • Lafarge unveils affordable housing units

    Lafarge unveils affordable housing units

    Lafarge Holcim has unveiled a self-contained studio-flat at its Oregun, Ikeja, Lagos office in a move that may meet the desire of the majority, especially the low and middle income earners.

    The firm said the unveiling would serve as the bedrock upon which the firm’s planned delivery of a 500-unit of low cost housing in Gwagwalada, Abuja, is premised. The firm is executing the project with the Federal Government, which is contributing five hectares of land.

    The house types to be provided include two and three bedroom flats and studio types. Prices start from N1.5million for studio model, while others are between N4million and N6million.

    Its Head, Affordable Housing and Building, Mrs. Jumoke Adegunle, said the firm is taking affordable housing seriously. This, he said, informed its decision to come up with the studio model that are within the reach of singles and newly married couple, who are desirous to own their home, with little financial requirement.

    She said: “We are working on the possibility of delivering at least, 500 houses in Abuja in 2016. It is to be situated in Gwagwalada area of the Federal Capital Territory (FCT), in partnership with some developers.

    “As a long-term vision, Lafarge plans to come to the aid of individuals who would be home owners by assisting to help in building with this technology, which will not only be cost effective, but also saves time and offer quality.”

    The Project Contractor, who is also the Chief Executive Officer of Tye-Wall Construction Ltd., Mr. Tunde Isiolaotan, said the building was developed using modern technology known as “aluminum shuttering.”

    He said the use of this technology saves between 20 and 25 per cent of what it would cost to build in conventional ways.

    Isiolaotan described the house as ‘bulletproof’ as a result of prefabricated concrete blocks used in making the shell. Also, the electric cables, plumbing materials and other amenities are conduit except wash hand basins and toilet closets.

  • Environmentalists hold dialogue

    Environmentalists last week met in Abuja to fashion out how to control waste in the country.

    At the forum titled: Ninth national stakeholders forum on environmental best practices in waste control: initiatives and innovatiowns, which included senior officials of the National Environmental Standards and Regulations Enforcement Agency (NESREA), among others, participants sought effective engagement in waste control, economic incentives and reward system in waste control. They creation of wealth from waste and e-waste control for environmental protection and sustainable development.

    In a paper titled: Towards effective stakeholders’ engagement in waste control, former managing director, Lagos Waste Management Authority (LAWMA), Ola Oresanya, canvassed awareness campaigns for proper waste management habit/practices and use of establishment of relevant communication channels to reach stakeholders, especially those who generate and dispose waste recklessly.

    Also at the one-week event were House of Representatives’ Committee on Environment Chairman, Obiora Chidoka;  representative of Minister of Environment, who is Director-General, Environment Impact Assessment (EIA), John Alonge; Director, Partnership and Education, NESREA, Sam Aniefon Akpabio; his Environment Quality Control (EQC) counterpart, Mr Simon Joshua and Valentine Opone of the National Environment Society.