- From Blog Archive
Housing sector can't satisfy growing demand- Developer
By Kinglsey Adegboye
With the glut being experienced in property market across the country, the housing industry still has a long way to go in order to satisfy its growing demand, particularly as it affects low and medium income earning segments of the society. Disclosing this at an exclusive interview with Vanguard, Mr. Kennedy Okonkwo, Chief Executive Officer of Nedcomoaks, a Lagos-based real estate development company, revealed that the growing demand for housing across all strata of the society is so huge that the industry cannot satisfy the demand.
According to Okonkwo who started real estate business as an estate agent, it is difficult to churn out 500 housing units annually in the country by developers. Now his firm has a mission to provide affordable homes for Nigeria's middle class. Emphasising the importance of shelter, Okonkwo noted that he went into actual construction of houses by starting with a room and palour self contain.
He said after food, the next priority of a man or woman is shelter which explains the growing demand for housing across the nation. He added that the demand for housing in Nigeria is so huge that it requires the collaboration of government at federal and state levels as well as private developers.
Okonkwo pointed out that he went into the property development because he felt there is a real need for it. "When you look at your needs, it is food first and then you think of shelter. So there is no way anybody that is providing shelter will get it wrong. I think there are enormous opportunities to tap into in the Nigerian property market today and the reputation of the developer matters a whole lot," he said.
Explaining how it all began, the Nedcomoaks boss said: "I was working as a strategic adviser for a company and my part time job in real estate had a deal that was worth N18 million. The deal meant that I was going to provide accommodation for expatriates and the company that gave me the contract was waiting for me to come and see them but I was busy doing a strategy session in the office. So, I lost the deal to a competitor. There and then I said to myself it is time to focus on the property business. I therefore resigned from the job.
My journey into construction of houses actually began when I brokered my first deal as an estate agent worth N260,000 as commission. I started scraping together money to develop one property and once we sold that, we would build three more properties because we would market and get other people to buy. Initially, we started with one room and palour self contain. However, the moment we got loan from a bank, we were able to expand very rapidly. We started with leases on land from some land owners who had signed an agreement over land for 30 years with some families who did not have money to build on the land and time was running out. So, I approached them and got the land on lease. I got about 22 parcels of land and started building four units of room and parlour self contain and doing resettlement schemes."
Bemoaning challenges confronting the industry, Okonkwo lamented a situation where a developer after completing an estate, has to provide power and build roads to service the estate, saying all these add up to the cost of owning homes in the country, because developers usually transfer such costs to buyers. He said another major problem of developers is huge interest rate being charged by banks, pointing out that mortgage facilities are not readily available and where you have them, they go for double digits, which is not what is applicable in other countries of the world. Okonkwo said 'Victoria Crest' is the flagship of his projects, noting that it consists of three-bedroom terrace homes, with ample parking space due for delivery this year, adding that the phase I of Victoria Crest comprises 92 units of terrace houses, while the second phase will consist of about 300 units when fully completed.