Mitigating Potential Risks In Lagos’ Real Estate Market

Ways to reduce possible risks associated with the real estate development and transactions top stakeholders’ agenda when they converged on Lagos last week. DAYO AYEYEMI reports.

Many stakeholders, comprising real estate developers, home builders, realtors, town planners, architects, engineers, mortgage providers, protech experts, building materials producers, interior decor practitioners and officials of various government’s ministries and departments, among others have come out to discuss various challenges militating against the smooth running of businesses of real estate in Nigeria, especially in Lagos State.

The occasion also provided them the opportunity to meet with other service providers, policy makers and government’s regulator to proffer solutions to some of the challenges in the industry,

The two-day event was the third edition of Lagos State Real Estate Market Place Conference and Exhibition, themed: “A Town Hall Meeting on The Lagos Real Estate Emerging Markets- Mitigating the Potential Risks.”

Some of the identified challenges in the sector included incessant building collapse, bureaucratic procedures associated with plan approval, issuances of building permit, Certificate of Occupancy, and proliferation of Lagos’ market with sub-standard reinforcement bar, among others.

The event was organised by the Lagos State Real Estate Regulatory Authority (LASRERA).

Steming building collapse

Speaking on ways to stem the tide of building failures in Lagos State in one of the panel discussions, the immediate past President, Nigerian Institute of Town Planners (NITP), MrToyinAyinde, explained that construction starts from conception, adding that building goes beyond the physical structure that people see.

According to him, whenever building collapses, ideas and dreams have collapsed.

He pointed out that many developers have refused to pay attention to putting people before gains.

“Our values have dwindled, people are concerned with their investments rather than the benefits of investing and people,” he said.

To turn the tide, Ayinde, a former Commissioner of Physical Planning and Urban Development in Lagos, said it would require collaboration of all professionals in the construction industry in addition to financiers and ICT professionals.

“We need to conceive and think through the project to prevent building collapse,” Ayinde said.

General Manager, Lagos State Building Control Agency (LASBCA), Gbolahan Oki, an architect, while reeling out the role of his agency, stated that attitude of real estate developers who are found of moving from three floors to seven floors without approval was an issue in the sector.

In addition, he pointed out that the habit of erecting building without infrastructure was a major challenge.

According to him, lack of maintenance’s culture among developers and landlords, whereby buildings were left to degenerate was also responsible for building collapse.

“If you want to build, get your building plan’s approval; get your authorisation, get insurance, safety caution and other documents. Then you move to site.

“We make sure that developer do the right things, but 60 percent don’t build on what they got approval for. So we want people to follow the approval.Foundation for four floors can’t carry seven floors.

“We need to engage professionals to stop building collapse,” Oki said.

General Manager, Lagos State Material Testing Laboratory, FunshoElulade, said that engagement of unqualified professionals was a major cause of building collapse, adding that faulty foundation, weak construction, lack of soil and material tests and natural disaster were other factors.

He urged developers to do the right things by ensuring that they follow the laid down guidelines in order not to waste money.

“It’s high time for buyers and accommodation seekers to request for non-destructive test from developers before they move in or part with money.

After completion of building, he urged developers to secure certificate of fitness from the government.

Managing Director, Megamound Investments, Chief OlumideOsunsina, a real estate developer, urged the state government to fast track the issuance of building approval and other documents to practitioners.

“A lot of us borrowed money to build, so you need to fast-track these documents. We need them quick. Developers must be given the pride of place, they must be given special consideration,” he said.

Director-General, Lagos state Safety Commission, Mr LanreMojola, urged developers to think of safety as a culture, adding that they must leave enough space during construction.

Site monitoring

The panel also suggested the need to involve professionals in the private practice in the monitoring of building construction sites in Lagos State.

PROTECH

During the Panel Session on Deploying Technology for Transparency and Growth of the Lagos Real Estate Market, The Moderator, Dr Roland Igbinoba, Founder, Pison Housing and President Nigerian Proptech Association, revealed that GIS is critical for development and Transparency in the Real Estate Sector.

Speaking during the opening ceremony of event, Lagos State Governor, Mr. BabajideSanwo-Olu, expressed concern over the rate of unprofessional practices in the real estate sector in recent time.

This ugly development, he said called for increased vigilance on the part of all genuine real estate practitioners and government.

The governor, who was represented by his deputy, Dr Obafemi Hamzat, urged

registered real estate practitioners to uncover the quarks in the profession in order to salvage the image of the practice.

He recalled that the conference and exhibition was initiated as a platform for individuals/organisations operating in the sector to network and address developmental issues affecting the real estate business in Lagos State.

According to Sanwo-Olu, the theme of the event was adopted to beam search light on the sector against the background of new tactics and strategies being deployed by unscrupulous and fake practitioners to defraud unsuspecting clients.

“As a government, we owe it a duty to safeguard investments of people who may be unaware of some unprofessional practices in the market. The need to restore public confidence to this sector led to the establishment of the Lagos State Real Estate transaction in Lagos State to protect the citizens and investors from the potential risks emerging in the market,” he said.

The governor pointed out that LASRERA has defined minimum operational standards and guidelines for citizens to abide with.

According to him, the guidelines provide a comprehensive checklist for the citizens to correctly identify and have competitive list of registered individuals/organisations in order to avoid doing business with quacks in the system.

“We can’t talk about risks in the real estate sector without mentioning the violation of principles of transparency and real estate laws. These to a greater extent, are major potential risks in this sector,” he said.

Sanwo-Olu called for joint monitoring of the sector to curb quackery and unlicensed operators.

He maintained that the real estate market can be the floodgate of economic prosperity to the state and stakeholders when potential risks are minimised.

He pleaded with Lagosians and everyone interested in real estate business to be cautious in any financial transaction they engage in by fact-checking the track records of the organisations they are dealing with to ascertain if the individual/organization is registered with LASRERA and other relevant government agencies in the built sector.

Special Adviser to the Governor on Housing, Mrs Toke Benson-Awoyinka noted that the impersonation in the real estate industry is becoming unethically high and seriously contributing to fraudulent proliferation in real estate market. This, she said was having negative impact on the reputation of individuals/ organisations including the regulating agencies of the state government.

“This development calls for appropriate regulation, implementation and enforcement of the real estate laws in order to restore sanity into the sector and instil public confidence in the real estate profession.

“This explains why LASRERA is mandated to regulate and register those individuals / organizations who are involved in this sector.

“Lagos State Government is determined to ensure sanity is restored to the state’s real estate environment with the review of the agency’s law on Monday, 7th February, 2022, to protect investors/investees against any potential risks and also prosecute individuals / organizations, boost the activities of real estate markets with accredited and licensed practitioners,” Benson-Awoyinka, said.

Land information

The Special Adviser to Lagos State Governor on E-GIS and Physical Planning, Dr OlajideBabatunde, said that with the computerisation of documents at Lands Bureau, people could sit comfortably in their houses and offices and access information on government portals relating to properties and lands in Lagos State.

Permanent Secretary, Lands Bureau, MrOlabodeAgoro, said that the registration of individuals and organisations by LASRERA is to make sure that only qualified and certified practitioners are allowed to practice in the real estate sector.