The Managing Director/Chief Executive Officer, Esso Properties Limited, Dr. Smith Sosochukwuma Ezenagu, is a real estate developer who understands the nitty-gritty of the industry. In this interview with OKWY IROEGBU CHIKEZIE, he speaks on germane issues in sector and other sundry issues in the economy. Excerpts:
The Federal Government is planning to sell her building assets and others projected to be over 2,000 across the nation to fund 2023 budget. What is your take on this?
It is a welcomed development bearing in mind its economic sense and the plan is commendable given that the benefits are much more in terms of grading especially the government’s plan to check budget deficit. The sale of these properties which are mostly neglected and abandoned is in itself an economic recovery drive. Keeping the assets is equivalent to the nation short-changing itself and adding to the cost of governance resulting in economic wastes. Maintaining these properties over the years without putting them into good use can be described as wasteful. Why keep properties or assets that have been derelict and not put into good use than disposing them and ensuring that they are put in the hands of the private sector who will put them into good use.
Unfortunately Nigerians are employed in some of these businesses across the nation which adds to the cost of governance given that many people are employed across these properties. Personally, l believe that government have no business in business, government should be preoccupied with policies and also providing an enabling environment for the private sector to thrive. If government can put the plan into action and ensure its fruition, Nigeria will be better for it as it will go a long way to reproduce multiple times other streams of wealth for the nation.
PenCom recently notified of its intention to invest the pension fund into the mortgage sector to allow Nigerians own their homes by accessing an efficient and efficient mortgage system. Do you think this is a right decision?
This is a brilliant idea which is already in existence and should be encouraged and properly publicised as the current National Housing Fund (NHF) which is an opportunity for Nigerians in all sectors of the economy, particularly those within the low and medium-income levels who cannot afford commercial housing loans e.g. civil servants, traders, artisans, commercial drivers, to own houses of their own. Any intending beneficiary must be a registered contributor and up to date with his/her contributions. Others that are qualified are the vast majority of civil servants who are beneficiaries to the pension scheme and have been in contribution for over 10 to 15 years. By this singular policy, the pension contribution of these people will be able to invest 25 per cent of their contributions towards owning a house. My only worry here is for those in private employment who are not fully integrated into this scheme. For our employees in ESSO Properties Limited, I will say that they are fortunate and lucky to be introduced to both the Pension and National Housing Scheme. With time if the implementations and regulations are smooth, it will be another source of actualising the MDG’s goal on housing for all.
As a developer what do you think the government should do to encourage housing developments with the over 25 million housing deficit?
I think the government should look at policies that will encourage real estate companies to develop houses to meet the need of Nigerians. The processes for getting C of O or other title documents should be simplified. Government at the centre should partner with developers to reduce the housing deficit. Government must be convinced that the issue of mass housing provision be put in the forefront as housing provision is a key pointer to development and GDP growth. Secondly, the only way to access loan for building is through the mortgage banks and the stringent measures attached to the processes of getting the loan are bottle necks on their own. I canvass the need for government to create primary mortgage banks with less stringent but efficient methods of making construction funds available to the willing and ready masses to benefit from and as well create natural ways of recouping the fund. The creation of less cumbersome policies for this purpose will see many owning houses and over the time bridge the gap of housing deficit in the country
How do you think that government can eliminate fake and substandard building materials?
There should be stringent laws to eliminate the importation and production of substandard building materials, we must try to be stricter at our borders and also we must establish a government body that supervises or inspects building material sellers, importers, and users in Nigeria. If we must import from overseas, let it be products that scale the quality and standard index.
What is your take on building Code that is currently been domesticated by the Lagos State government?
I subscribe to the fact that Sectoral Operators should deliberate on a methodological approach towards the domestication of the National Building Code (NBC) and the integration of the Building Energy Efficiency Code and green building principles to the Code. However, it’s unfortunate that after over two decades, it has not be passed into law. It remains sad in our national discourse that 20 years after it was signed by then Housing Minister, Dr Olusegun Mimiko, the enabling law to operate it has not been passed. NBC was designed to protect people from fire, windstorm and ensure structural integrity and energy efficiency. For instance, in Britain, building codes are reviewed every two years to incorporate new technologies in the sector. Sadly, we have inadequate framework for monitoring standards in building construction while those already constructed are collapsing. The Building Code is divided into four parts of Predesign, design, construction and post construction. Government and her agencies should also not be over bearing but serve contravention notice or stop work notice when necessary. Professionals in the sector should also note that a badly built house is a death trap and should avoid the trap of using substandard and inferior building materials. This is in addition to avoiding poorly designed buildings and changing the use of a particular building without proper clearance form relevant government agency. As an organisation, we are in full support of any government policy that brings about order and stability to the real estate industry. We are of the belief that the code will help regulate and control the quality and type of building built in any state of the federation. No doubt this will eventually save lives and curb the growing issue of collapsed buildings across the states.
Read Also: NSIA grows assets to $4bn using funds from recovered loot, ECA
As a property development company in which area of the housing segment do you operate?
We operate across all three tiers of the economy as we believe that every Nigerian should own a home. We provide dream homes to Nigerians according to their budget. In other words, we operate in all segments of the strata be it low, middle or upscale. We strongly believe that every Nigerian should have a decent roof over his or her head.
Some operators see the issue of C of O, titling and governor’s consent as an impediment to their business and have called for the liberisation of these documents. Do you share this view?
We understand the issue raised but title documents are the only recognised proof of ownership of landed properties in Nigeria. As of today, we can only appeal that the process is simplified and sped up. The delay experienced while processing title document in Nigeria, to me, is unnecessary. These processes can be sped up to encourage developers and real estate consumers. How can I apply for a title document and then be made to wait until I almost forget that I am processing a document.
What particular policies do you think government should come up with to help developers like you?
Like I cited earlier, any policy that can help to reduce the cost and process of acquiring land document and title will greatly help developers. Secondly, any policy that will help developers have access to funding for development will help the industry.
Developers now deploy different strategies including offering livestock as a marketing strategy. Can you shed more light as to your firm’s strategy in marketing your products?
These are promotional items that are considered a good strategy to attract customers. We all know of the “fear of missing out” syndrome and the effect it has on the human mind. As an organisation, we practise different strategies to attract clients, no doubt promos are very beneficial to every organisation.
With the recent building collapses across the country, what do you do differently to avoid it in your estates and why do you think that buildings collapse are more often these days?
Poor quality of building materials and poorer quality of contractors are the major reasons. As an organisation, we have made it part of our company policy to give the highest standard in service to our clients. We get best quality in materials and standard contractors who meet the highest standard in the industry.
How will the newly approved Lekki International Airport impact on real estate in the axis?
The biggest winner will be the Real Estate sector. No doubt the corridor has witnessed massive rise on land purchases within the Lekki-Epe corridor.It is public knowledge that Ibeju Lekki is the fastest growing piece of Real Estate in West Africa and this has been largely due to the massive projects currently springing up in the area.
The emergence of the Dangote Refinery and fertiliser plant and the Lekki Deep Sea Port and Free Trade Zone have seen Investors from within and outside Nigeria troop to the Lekki axis in preparation for the boom that is about to happen as a result of all of the facilities springing up”.
“Now with confirmation that the airport is about to materilise , it will further fast track the presence of more regional headquarters, hotel chains, even better road networks and the much talked about 4th mainland bridge to ease traffic for Lagosians, thus generating more revenue for the government and creating more Jobs for Lagosians. It will also witness more investments from the diaspora”.
Epe a sleepy town near Lekki might perhaps be the biggest “gainer” from this project. As a matter of fact recently the town has witnessed a rise in development as a result of government projects and real estate companies that has found it attractive.
There will also be automatic increment in the cost of real estate, high influx of corporate entities who would most definitely want to set up near an “international airport” and high end developments.
There will be massive increment in both local and foreign investors and the presence of the airport will give way to more government projects in Ibeju Lekki and its axis thus further opening up the area and its environs. I also believe that more jobs means more people, and more people means a high demand in rental properties and spaces and existing properties will triple in prices”.
Finally, this is not the time to buy a land or own a land without a title as the government will clamp down on untitled lands and there might be little or no settlement for people that have bought untitled properties.
On incessant building collapse across the states?
Apart from the collapse of existing buildings, new structures under construction are also caving in. This scenario has made residents to begin doubt the sincerity or seriousness of government and professional bodies in their fight again building collapse.
There has been reported building collapse in almost all the states of the Federation but Lagos occupies the unenviable position accounting of 63 per cent of the total building collapse across probably as a result of the huge population, topography and the rush to get rich quick by some developers. Few weeks back a 7 -storey building caved in Oniru area, Victoria Island, Lagos with two other incidents of collapse in Kubwa – Abuja and Kano last week.
How can this be checked?
It can be checked by the sincerity of government and her agencies. If government strictly insists on the quality and standard of building materials imported into the country and the locally manufactured ones we will have less of collapsed buildings. Unfortunately substandard materials find their way inside our country without any check. Again, quacks have entered the sector. Building construction should not be for everybody but for those who know a thing or the other in the sector, the regulators also have their own blame as some of them leave things to chance. Another challenge is the bureaucracy in obtaining Titles and building permits that allow people to bend the rules to achieve their aim. It will also help if professional in the sector stay in their lane. The idea of a contractor being the architect, engineer and builder is not helping the sector.