…laments FX, inflation impact on real estate
Oak Homes, one of Nigeria’s frontline luxury real estate investors and developers has expanded its projects portfolio in Nigeria with the recent launch of its latest residential tower, Oak Residence, in the heart of Victoria Island, Lagos.
The company says that despite the economic challenges with the associated inflationary trends, high interest rate and forex volatility, they have been able to defy these odds and deliver this project along with three others to the admiration of investors, lamenting how these macro-economic conditions impact negatively on real estate.
Olukayode Olusanya, the company’s CEO, noted that access to finance and market predictability are also major challenges facing the sector. The CEO, who spoke at the commissioning of the new building project, stressed that foreign exchange and inflation, particularly, have ambushed the growth of the sector, having caused a crisis in building development.
“I will just talk about two areas that affect me as a person now, that is, using myself as a case study. One is access to finance. The truth of the matter is that the more money you’re able to access, the more you can do; but it’s not just so because you can’t do much with a double-digit interest on loans,” he explained.
Continuing, he said, “we are paying 30 percent on borrowed money and you know Nigerians are price-sensitive. If I’m getting money at 30 percent, I will need to transfer that pricing to my customers. This remains a big challenge because the developer cannot do much when there is limited access to financing,”
Olusanya highlighted the predictability of the markets which deal with FX rates, and inflation among others, as another factor that has ambushed growth in the real estate sector, describing it as a trap.
“Let us say you’re doing off-plan and if I sleep now and say, I’m collecting money from you to build a house at 100,000; by the time I wake tomorrow, it will be 200,000 and I can’t come and knock on your door and say it’s another story,” he said, stressing the need for the government to establish a functional regulatory board can enable developers to build over a period of time with a fixed price.
He argued that if the government can plan and set up regulatory prices, regulatory board and others, then you can plan for the next six months such that any developer that does not build within six months, can say, it’s his fault because he knows that price is fixed the six months.
The CEO commended his team that despite the economic challenges with the associated inflationary trends, high interest rates and forex’s volatility, they have been able to defy these odds and deliver three luxury real estate projects to the admiration of investors and subscribers.
The three projects are Oak Residence, Oak Mews and Hamilton Court, all located in the heart of Victoria Island and Lekki, Lagos. According to Olusanya, the completion of the project highlights the company’s resilience and determination in delivering transformative projects.
“The commissioning of these three landmark developments reflects our dedication to excellence and innovation in luxury real estate. In a period marked by global economic turbulence and domestic challenges, we have demonstrated that vision, strategy, and a commitment to quality can overcome even the most formidable obstacles,” he said.
The newly commissioned projects join Oak Homes’ prestigious portfolio which includes Nicole’s Place, Kayla’s Haven (Phases 1 & 2) in Victoria Island and Lusso in Ikoyi known for their impeccable design, functionality and astronomical increase in value since completion.
The Oak Place in Ikoyi, an exclusive collection of ultra-luxury smart homes, is described as the first of its kind smart housing estate in Nigeria while the Oak Villa in Abuja, is the company’s pioneer ultra-luxury development in the FCT, marking its expansion into the Abuja market. The company also has projects coming up in Eko Atlantic City, including Acorn, Lusso RA, and The Oak Towers which, according to the CEO, “push the boundaries of ultra-luxury living and timeless value.”
“The Oak Heights, a 38-floor architectural marvel set to become Nigeria’s tallest building, is cementing Oak Homes’ reputation for ambition and innovation. It is designed with high ceilings that create an airy, expansive feel while offering breathtaking views of the city from every floor.
According to the CEO, each unit features living spaces with high ceilings, creating an airy and expansive feel which shows the company’s ability to merge Nigerian innovation with global standards, creating value for both local and international clients.
Meanwhile, the company has expanded into the international market with its recent entrance into the United Kingdom and USA. It is making strides in transforming the luxury real estate landscape globally.
Join BusinessDay whatsapp Channel, to stay up to date
Open In Whatsapp
