Experts in the real estate sector have spotlighted things and actions governments at the federal and state levels should do to revision the country’s built environment for the benefit of the people and economy.
The experts who spoke at the 2nd Biennial Corporate Governance Enterprise Development Conference organised by Centre for Enterprise Governance in Lagos recently, noted that developing the built environment needed a lot of policies from the government.
“The built environment refers to the man-made surroundings that provide the setting for human activity, ranging in scale from buildings and parks or green space to neighbourhoods and cities that can often include their supporting infrastructure, such as water supply or energy networks,” Hakeem Oguniran, Founder/CEO, Eximia Realty Company, explained.
Oguniran who was the keynote speaker at the conference, added that “built environment encompasses places and spaces created or modified by people including buildings, parks, and transportation systems,” noting that, in recent years, public health research has expanded the definition of built environment to include healthy food access, community gardens, and walkability..
To revision these places and spaces, neighbourhoods and cities, he said that the government and relevant stakeholders have to “pull the right levers” by overhauling the land tenure system.
He cited a PwC Nigeria’s Report titled ‘Bringing Dead Capital to Life: What Nigeria Should be Doing’ which estimates that Nigeria holds at least $300 billion or as much as $900 billion worth of dead capital in residential real estate and agricultural land alone.
Finance, he said, is another right lever to pull by create the right platform for long term funding for real estate and infrastructural projects, listing such funds as Bonds, Real Estate Investment Trusts (REITs) and other asset-backed securities. He added that retail financing should be createdto expand absorption capacity
Government should provide primary infrastructure, by ensure the completion of infrastructural services in layouts before sale or allocation to developers. He added that developers should be given appropriate incentive to be able to put real estates on the market..
“There should be tax reforms and credits, or inclusionary models that use public lands and other incentives. Government should encourage re-investment of profits in real estate to increase housing stock, allow for tax holiday for investors in the sector and introduce betterment levy for improvement made in neighborhoods to engender ownership of schemes,” he advised.
On his part, Babajide Odusolu, CEO, Octo5 Holdings, pointed out that there were some challenges impeding the revisioning of the built environment or development of the real estate sector.
Speaking on the topic, ‘Threats and Opportunities in the Construction Eco-System in Nigeria’, Odusolu noted that government is using policy as primarily internally generated revenue (IGR) driver, adding that government was failing in providing holistic infrastructure and refusal to provide fiscal incentives for private developers who do so.
“Inadequate/non-existing standards for artisanal craftsmen and lack of certification processes, demand outstripping supply, lack of strong credit system that triggers desperation; and most builders/owners being unable to leverage their real assets due to location mismatch, poor documentation, and avoidance of costs leading to flawed assets, are some of the challenges,” he said.
Odusolu advised that as a way out, government should reduce multiplicity of charges attached to building control processes; partner all built sector professionals and negotiate highly reduced rates for homes particularly priced between NGN10million N50million.
They should also offer fiscal incentives and tax credits for developers who provide infrastructure in their schemes; facilitate credit schemes and incentivize localized manufacture of construction materials, and offer documentation amnesty for all undocumented homes or homes on government acquisitions with specialized tariffs.
“Partner developers and institutions to create certification system for master craftsmen and ensure only documented/certified craftsmen can practice trade; enforce registration protocols for realtors to eradicate/reduce industry fraud, and partner developers to undertake slum regeneration and enforce development of blended (social, affordable and blended premium housing) communities,” he said.