The President and CEO of BSTAN Group, a housing firm, Becky Damilola-Oke, decries poor investments and neglect of the housing sector, stressing that successive Nigerian governments at all levels have failed to address the huge housing deficits in the country, which she says is about 30 million contrary to the claim of 17 million deficits in public domain. In this interview with INNOCENT ODOH, the CEO says the HouseFair hosted by the group recently in Abuja was to sensitise the people and attract investors into the potentially rich housing sector even as she demands more robust mortgage system adding that Public Private Partnership (PPP) remains the only solution to the challenges in the housing sector. Excerpts:
How do you see developments in the Nigerian Housing sector and how has BSTAN exploited this opportunities therein?
I think the Housing sector has improved a little bit though not as expected compared to the developments in other sectors or industries in Nigeria. Nevertheless, compared to few years back, I think the sector is growing. There are certain things things that need to be put in place to help the sector grow more. These are; the right polices, good partnership, financial growth, mortgage system, among other factors.
But for us in BSTAN Group, to a large extent in over a decade now, we have tried as much as possible to make a strong impact in the Housing sector and to the glory of God I think we have been able to a lot. It might not be largely seen because the deficit in the country cannot be solved by one single organization, it requires the involvement of more organizations and government involvement and willingness. For the fact that I am in the industry I can tell you that the housing deficit is over 30 million because we have too many displaced people right now that are not captured in the UN statistics. So we have too much homelessness. So, if you put all these together the number is very high.
In BSTAN Group, we have been able to do over 22,000 housing units’ singlehandedly without government involvement yet, without partnership yet, without so much of involvement of state governments. At the moment we have ‘Vision 2020’, which is to provide 1 million housing units per year. The Vision 2020 will largely require a lot of partnership between the federal government, state government, the financial sector, between a lot of parastatals and organisations which are the off takers. So a million per year is a vision we have put in place for us as an organisation to improve the housing sector as much as possible. This is because if we are doing a million in a year, other organizations also pick up a million per year, in five years from now; we should have reduced the deficit by 50percent.
You have mentioned a lot of things which have not been captured very well by the government, particularly the issue of mortgage. What exactly do you think is the problem of mortgage system in Nigeria?
In practical terms, unavailability of funds is one major issue that I think it is a problem with mortgage system in Nigeria. Secondly, the unwillingness to do the right thing and thirdly the crazy bureaucracy, high interest rates is another issue and fifthly, the unwillingness to produce mortgage for the people. I believe there is a way these things can be done properly. In the last HouseFair summit, I proposed that for everyone that is a civil servant, the government can prepare twenty years out of 35 years mortgage plan for everyone and do what we call ‘Housing for All’. We in BSTAN are ready to produce the low cost housing for all civil servants in Nigeria if the government is ready to put that in place. We have the machinery, we have capacity, we have the technicality and everything required. Two things we need from any state government or the federal government is availability of the land. Government owns the land so instead of us to spend our money to buy the land we spend the money to build the houses. Secondly, the off-takers, which the government has, are the civil servants that are suffering. Imagine a man retires after serving the country for 35 years and is still living in a rented house; he cannot afford even a two–bedroom, which is wrong for a growing nation like Nigeria with all the resources we have in this country. So, what we are proposing is a 20-year mortgage plan that a few amount of money can be reduced from the civil servants for the next 20 years and every civil servant will be able to go for it.
I have a slogan which says, when accommodation problem is solved for any Nigerian, 50percent of that person’s problem is solved because if you solve accommodation problem, then you can solve Nigeria’s problem because the nation starts from families. When the families are in trouble the nation is in trouble. If the family does not have peace the nation cannot have peace. So if truly our country wants to grow, I think the growth should start from the housing sector because a man that is homeless cannot think education, cannot think of jobs, food or any other thing and housing is a basic need, the fundamental right of every Nigerian.
Then the financial sector, the banking sector, the mortgage sector need to as well come in partnership with developing companies such as BSTAN Group. If we have the off takers ready to take the houses through the civil service housing scheme and the banks are ready to partner with us financial wise, then that becomes a synergy that can fly. One million houses per year become very easy to do. And this will also help investors to come into the sector if there is a good policy in place. There are several investors who are afraid to come into the housing sectors because of policy. There is no strong policy backing the sector because Nigerian government does not see any growth in the sector. But they forget the fact that this is what is feeding some countries like UAE, Singapore, Egypt and several others. It is from this housing sector that they grow.
Despite all the challenges, you have provided 22,000 of housing units this year alone that is huge investment in the sector. But how do you cope with the high cost of land registration and titling and the policies of government said to be inconsistent over the years?
Business comes with passion and for us in BSTAN, we have passion to provide housing, it has gone beyond money making for us, it is a vision that we want to see come to reality and as much as possible we try our best to go the extra mile. But it is not easy because we do have some financial challenges. We are struggling with loans, interest rates, banks, investors, cost of land which we have to buy; we have to struggle with the locals. But in all of these challenges I think our passion and willingness to go the extra miles have kept is alive of course by the grace of God.
We have focus and we set goals for what we want to achieve year in year out and to the glory God it can get better. That is why we are using this opportunity to call on the right investors who understand that we have the goal, we have the business and we have the market. Any investor, be it a bank, an individual, government or organization that partners with us will go home smiling quarterly or yearly because you can get as much as 40 – 50percent return on investment when you put into BSTAN group. We have tested the market for years, we have the right market, we have the experience, we are not building super luxury homes, we are building what is called a need not a want.
PPP has been adopted in Nigeria for the construction of affordable housing in the country but not much has been achieved through this scheme. How can this be improved? And what are the prospects of the PPP in the housing sector?
The PPP scheme is what grows every nation. PPP is what is growing Lagos. Take for instance in Nigeria most of the capital and infrastructure projects done in Lagos are done under PPP and that is why the business is growing and investors are willing to come because they mastered the act of PPP. That is the model that can work in the housing sector because the government cannot singlehandedly provide the houses for the whole nation, no nation does that. All the countries that have grown in the industry have grown through the PPP scheme. Government has the land everywhere, it can bring in financial investors that can grow the nation and bring in developing companies like BSTAN Group that has track records in the sector, without unreasonable bureaucracy and without nepotism.
The PPP scheme is supposed to grow the housing sector and I still advocate for the scheme, it should be encouraged, the government should come into partnership with Housing development companies and the financial sector; this is how we can solve the problem of housing. So, I call on Minister Babatunde Fashola to do something about the Housing sector because only the PPP can solve the problem.
Why is the PPP model not working in Nigeria? Is it a question of rivalry between the government and the private sector?
It is a question of unwillingness, it a matter of selfishness and not rivalry, it is a matter of ignorance and nonchalance. There is no rivalry between the government and the private sector because there is no government that can strive without the private sector and there is no private sector that can strive without the government because the government prepares the policy that guides the private sector, so every entity has their roles and responsibility both the private and public sector. We have written letters to government parastatals, we have written to the Vice President’s office telling them that we are willing to build and construct these houses state by state. We wrote to the state governors, but it seems these guys are in those offices to enrich themselves, and not to do anything for the state. We are not asking them to bring cash, we are only asking them to create the platform as a government and give the land as equity to build the houses. We will source for the funding and get our financial partners to come in because the investors want to come for a project that can guarantee security which is the off takers ready to take these houses and we will build the houses. We have partners from Germany, from the US and China and Dubai who are willing to do all these projects but the right thing needs to be put in place but the state governments and federal government are not ready because the willingness is not there.
During the National HouseFair Summit, you made strong statements about looking for alternatives especially now that the government appears to have shown nonchalant attitude towards the sector. So, what alternatives do you have?
We know the problems. Most of our projects are for those who really need it- the 70percent who are average Nigerians, the middle class, the low class. So the National HouseFair is an event we put together every year to reach out to people, to let them know what we have. At the National HouseFair we also give out to people for free. Last year we gave about five plots of land for free, this year we gave 8 plots of land for free and many other goodies that went with it for people who are in need of it. Beyond that we bring our projects to their door steps by doing what we call the ‘flexible payment’ plan aimed at giving people affordable homes at flexible payment plan, doing it a t 30percent discount in most of the projects, allowing people to pay as little as they can to the point that we even allowed a monthly payment of 33,000 naira.
This is what we call ‘Housing for All by Force,’ because if you are a civil servant or business owner, 33,000 is what you can afford in one month. So, we give to people in that way that they can buy into it and allow people to pay and spread the payment by installments up to three to five years on some of our houses. Owning a home had been made easy by BSTAN but you must make some sacrifices.
There is the challenge of poor quality of housing stock attributed to the fact that the construction industry is driven by cost minimisation rather than value maximisation. This has manifested in poorly constructed buildings, some of which have collapsed killing their occupants in some cases. What is your reaction to this?
I am a civil engineer by profession, so this is my core area. I have my PhD in Estate Management and construction and I am a member of Nigerian Society of Engineers (NSE) and a fellow of Council of Registered Engineers in Nigeria (COREN). It is a pathetic story to see structure that is supposed to be put in good standard falling off; it is an eye sore for the associations like COREN and NSE. But you see the professional bodies cannot be completely blamed for this because the owners of those structures most of them run away from paying the required bill of the professionals thereby going about to hire amateur bricklayers who may have 5 – 10 years experience. You see people building structures on swamps without soil test, without picking the right foundation. We have different types of foundation for different soil strata and you see people picking the wrong foundation for the wrong soil thereby causing what we call ‘differential settlements’ in construction. So, most of the constructions falling off are not completely caused by bad materials some of them are caused by wrong persons doing the project, some are caused by wrong designs, some of these projects are overloaded, some of them are under -designed while some are over designed. Lack of professional supervision also causes some of these building collapses and that is why the bodies have some blames because they are the regulators.
NSE needs to put up task force, COREN needs to put up tasks force to monitor construction going on. There is also another body called the Federation of Construction Industry in Nigeria, all these bodies should be given authority. The bill the NSE and COREN sent to the National Assembly should be passed. Authority should be given to them to regulate the industry and stop people not following the standard of construction in Nigeria, stop quacks and introduce a quality control teams. If you want to get a standard house get the right materials , get the right professional, a bricklayer is not an engineer, so there is no way you can ask a brick layer to build for you and expect a good quality house. That is why in BSTAN quality control is key to us and that is why we have not had any case of collapse structure in any of our estates in over a decade.
The government has presented a budget estimate of N10.33 trillion for 2020 and N262 billion for works and Housing sector. This is one area you should be looking at. What is your take on this?
With N262 billion allocated to the sector, you cannot expect the country to grow when people are becoming increasingly homeless. Population is increasing and how do you want housing deficit to reduce with this budget? The rate of birth is higher than the rate of death in Nigeria. So we need more houses for people. The Boko Haram insurgency caused IDP crisis and now flood caused more problems. Look at homelessness everywhere with no amenities or planning on how to provide house to these people. So, if homelessness is everywhere, the Housing sector should have taken forty percent of the Nigerian budget considering the state of the nation right now.
What is your take on the sprawling slums around major cities in the country?
Slums will keep growing because there are no plans for people to live in comfortable homes. Standard of living in Nigeria is bad. We have a programme coming up called ‘House Matter’ which will capture a lot on the issue of slums and probably provide solutions to how slums can be rehabilitated through urban renewal. You see people living in Maitama, Abuja but there is slum there. Everywhere you go in Nigeria there is a slum by the corner. Slums can be discouraged and we can do that by providing affordable houses for the people. See what Rwanda is doing they are providing affordable houses for people who cannot afford the villas. The growth of Rwanda since the 1994 genocide is amazing. Lack of adequate Housing causes more problems for Nigeria because when you live in a slum, you will be sick, when you live in slum; you cannot perform well in school and living in slums breeds criminality.
