Nigeria
Sector
Construction & Materials
Property
Nigeria's huge shortfall in housing and massive state spending on infrastructure is causing robust growth in the construction and property sector.
Investment opportunities
New Estate Development: The Federal Housing Authority (FHA) has choice land holdings in Nigeria's major cities such as Lagos, Abuja, Port Harcourt, Kano and in other state capitals.
Estate Management: Most of the completed estates require sustainable maintenance and management of facilities. Investors could partner with the FHA in the management of existing estates.
Investment structure: Strategic alliances and joint venture partnerships
Sector: Nigeria has a housing-stock shortage of approximately 12 to 16 million units. Only 10% of the population own homes and millions of citizens live in accommodation with little access to basic services. For this community, state-led housing projects represent their best chance through the Federal Housing Authority, which is the prime government agency charged with the responsibility of providing housing for the masses. Acquiring land can be a complicated exercise, with unscrupulous ‘developers’ not averse to ‘selling’ land that is in fact state land already earmarked for a highway. The crucial Certificate of Occupancy can be difficult to obtain, with state governors playing a big role in disbursement. Reforms, some of which are being implemented, include registering all real-estate
agents and new land certification processes. The housing shortage has created a rental market that beggars belief. Tenants can pay up to five years rental in advance to secure an apartment. In upmarket areas, like Victoria Island in Lagos, annual rental for a three-bedroomed apartment can run up to $50 000. In commercial property there is likewise a shortage, and when good-quality properties are developed (for warehousing or retail operations) 100% occupancy rates are routinely achieved. To attract further investment, it will be crucial for the government to fulfill its responsibility of creating an enabling climate through reliable power supply and regulatory environment.
