‘In real estate business, developing areas hold huge advantages’

Anselm Nnabuife is the CEO of Shaka Properties Limited, a Lagos-based real estate company with a mission to provide world-class real estate investment opportunities through property acquisition, development and construction. In this interview with CHUKS OLUIGBO, assistant editor, Nnabuife touches on a number of issues around land acquisition and development in Lagos, as well as the business that Shaka Properties does. Excerpts:

 
Tell us about Shaka Properties Limited. What exactly does the company do?
 

Shaka Properties Limited is a real estate company that is into real estate development, brokerage, property acquisition and disposal. We also handle property management, leasing and letting, project management, facilitation of overseas property acquisition, and so on. Our vision is to be a leading real estate investment brokerage company globally while creating opportunities for investors and providing avenue for world-class homeownership.

 

You currently operate mainly on the Ibeju-Lekki axis of Lagos. What is the attraction?

To get the best out of real estate business, you cannot limit yourself within an environment. The best attitude is always to go out there and discover developing areas. I started real estate business in Festac Town, Lagos, when I established Shaka and Associates with a few colleagues. Then it was mainly about renting of apartments, and once in a while you find a client that could buy a property. At some point I decided to venture out, and that was when my turning point in the business came. I ventured first to Badagry, where a family gave me a large area of land to survey, create a layout and sell. That was where I personally bought land for the first time. Then I went to Abuja, where I was also able to acquire some land of my own. My going to Ibeju-Lekki was fortuitous. Someone advertised a property for sale in Ibeju-Lekki. I communicated with the property owner via the internet and when I went down to Ibeju-Lekki to see things for myself, I discovered that the landowner, quite a young man, owned very large portions of land in the area. It surprised me and I questioned whether he got it by inheritance. One thing led to another and I moved to Ibeju-Lekki, where I found that real estate practice was more peaceful and organised than what we had in Festac. It has been about four years now and today, Shaka Properties Limited has large acres of land in different locations in the fast-growing Ibeju-Lekki environment, where you can buy a plot of land for as low as N500,000 and in 10 years the value would grow to N50 million depending on the kind of development around that corner. We currently have a number of estate sites for development. We have Lekki Republic Estate, Grace Garden Estate, and Shaka Republic Estate all in Ibeju-Lekki.

Some of the attractions in the area include many ongoing capital development projects, by government and private people. These include the Lekki Free Trade Zone, the Lekki deep seaport, the Dangote refinery, and the Lekki airport. So many multinational companies are also interested in the area.

 

One issue that worries prospective land buyers, especially in an area like Lagos, is the difficulty in getting certificate of occupancy. How does Shaka Properties navigate this challenge?

Formerly it was very difficult to get certificate of occupancy (C-of-O) for large areas of land because of the cost. But recently, Governor Akinwunmi Ambode has made it easy for people to apply and get their C-of-O directly, whether individual or global C-of-O. They used to issue gazettes to communities, which is as good as C-of-O. Currently, if you are dealing with virgin land, you can apply for land information and government gives you allocation, you can then process your C-of-O. If you don’t have the bulk money to pay, they give you the option of paying in instalment until you complete the payment. At Shaka Properties, C-of-O is not a problem. We have got C-of-O for some of our properties, and we are in the process of getting for the rest. We are paying gradually. When we complete all the payment, we will be issued with global C-of-O.

 

There have been cases where individuals bought land from real estate companies for development, only for government to come back to say the lands were illegally acquired. Do you have any such experience?

Such a scenario occurs when a property firm is not thorough enough to find out government interest in an area. By law, every land belongs to government, even though customary people have their rights to their traditional land. There are committed areas, where government has mapped out particular zones for particular purposes. Sometimes some real estate firms that do not apply rigour ignorantly acquire such areas. It takes only N10,000 to do verification on the status of a land you want to acquire through the state surveyor-general’s office to make sure that the particular land you are going to acquire is free from government interest. If it is under global acquisition but is not committed, you know the process to get it out from government. But if you are careless and fail to do your due diligence and go on to acquire a committed land, you will have to face it. But I can assure you that Shaka Properties is free from all that.

 

The other issue is the omo-onile menace. How do you handle that?

Omo-onile has always been there. This is their culture, you can’t rule it out. It does not hinder development in any area. It depends on how friendly you are within the system. You have to understand it is their culture and play along with them. Once you play along, it won’t be difficult for you to develop your property. You find out that they can even protect your site. But you have to spend some money.

 

There are also situations where you buy land and if you don’t develop it immediately, someone will resell it. Why is this so?

It usually happens when a community has sold large areas of land, which they usually do without consideration for their children. When those children come up, they won’t see any place to lay their hand. As such, any undeveloped land within the vicinity is in danger. Once you buy land from omo-onile, try to put a little development there. Even if you don’t have money to fence it round, just put something like a room self-contained on it and look for someone to stay there. Nobody will go there. Any prospective buyer that sees that someone is living on such a land cannot go ahead and buy without asking questions. When you ask, you find out that the owner is not selling the place. Omo-onile cannot take you to a developed land or a land that has a structure on it. You buy land from them to develop, not to keep. And sometimes when you check the receipt they give you, they write ‘six months’. You find out that after six months they will sell the land to whoever is ready to develop. When you come back, they will not deny you but they will take you to the riverside where you can keep your land till thy kingdom come. So, once you have money to buy land, make sure you keep some money to put a structure on that land.

 

Do those who acquire land through Shaka Properties have to go through the same experience?

No. When you buy land from Shaka Properties, your investment is safe because we protect your land; it is no longer in the hands of omo-onile.

 

How much does someone need to have at hand to be able to acquire land from Shaka Properties?

It depends on what you want. We have Grace Garden Estate that is currently selling for N3 million a plot, even though the value is N5 million. It is a developing site where you can live immediately. We have Lekki Republic Estate where you can also live immediately because the back of the estate is already developed. We also have other areas that range between N1 million and N1.5 million where you can buy and keep for a period of up to two years. When you buy from us, you can go to sleep knowing that your investment is safe.

 

Apart from the desire to be a landlord, what advantage does investing in landed property have over, say, just keeping your money in a savings account?

Real estate investment involves the commitment of funds to property with the purpose of generating income through rental and the growth of wealth through capital appreciation. All over the world, real estate investment is known to guarantee a steady cash flow from rental income. It also guarantees increase in value of your investment due to the capital appreciation. In a place like Lagos State, land is like crude oil; it creates value every moment of the day. Here, you can buy a plot of land at N1 million today and in the next three years the value will appreciate to N5 million. So, rather than keeping cash in the bank and waiting to be paid an interest of 5 or 10 percent at the end of the year, it is better to invest in landed property.

 

What advice would you give to prospective land buyers in a place like Lagos?

It depends on your capacity and what you have in mind. Sometimes people may want to buy based on the area they know and have lived before. For instance, many who have lived in Festac Town for a long time, when they have money to acquire property, prefer to buy built-up flats in Festac. It is not a bad idea, but you find out that the cost of a unit in a block of flats in Festac Town can get you a full plot of land in a developing area where you can build up to two or four units of the same flat depending on how many floors you want to build. So, from my experience, the best place to buy is always a developing area, not the built-up areas. Real estate business is all about development, and early entrants into developing areas that do not have much concentration are always at an advantage.