For real estate sector to contribute more to the growth of the economy and also for more affordable homes to be built, players in this sector must be given financing opportunities. This is part of the views expressed by BATHOLOMEW EGBOCHIE, the Group Managing Director/CEO of ATCO Homes, in a recent interview in Lagos. Egbochie also talked about ACTO Homes’ properties in different parts of Lagos and the opportunities they offer. He spoke with CHUKA UROKO. Excerpts:
The most recent figures from the Nigerian Bureau of Statistics (NBS) shows that the real estate sector grew by 3.85% in the second quarter of 2021. Compared to the lull in the market caused by COVID-19 in the same period last year, what’s your view on investor confidence in this sector?
Much like investors’ confidence. The real estate market provides investment opportunity with good yield for savvy investors, especially in Nigeria. The lull experienced in the market in 2020 does not reflect the value status of the market. As has been attested to, almost every sector, except for the big tech firms, felt the impact of the reduced trade activities occasioned by the restrictive COVID-19.
Despite all that market disruption which reduced household income and purchasing power, it was clear to keen market analysts that a rebound was somewhere around the corner. The partial return to normal business activities around the globe in the latter part of the preceding year renewed investment interest in the real estate sector.
Individual and corporate investors began to raise capital to deploy into the sector to build a strong investment boffer for the future. The future can be captured vividly. For instance, Nigeria’s population is projected to grow exponentially within the next 40 years. Looking at the bourgeoning demography of young people in the country, a whole new set of people would need housing, and places to serve as trade hubs.
Similarly, schools will be needed to cater for a fresh set of kids. Leisure centres and other facilities will also be needed in the nearest future. This overriding demography spread needs infrastructure upgrades which make real estate an attractive investment destination.
How is ATCO Homes positioning its project portfolios to help investors to make the best of investment options in the real estate market?
ATCO Homes is expanding its footprints in the real estate market, especially across the Ibeju-Lekki axis now fondly called ‘the new Lagos’. For now, we have about 15 gated estates in Lagos. Easy access to our estates guarantees our off-takers 60—65 percent annual return-on-investment.
The drivers of these new upscale real estate investment opportunities include the Dangote refinery project, the mini seaport, the Lagos state jetty, the different beaches scattered around the area, and the proposed International Airport to be located in that area. We are a customer-driven business. We prioritize our clients’ investment needs and that is why we work daily to create investment opportunities that are tied to their aspirations.
What investment and homeownership structures have you put in place to encourage both low and mid-income earners to tap into your products offerings and to ensure that investment benefits reach everybody?
We have consistently conducted our business in a way that spreads opportunities to everybody across different income levels. We have in place affordable real estate purchase and investment structures. These include an affordable initial deposit for low-income earners and an installment payment option that is spread over 24 months.
We have also consistently given our clients cars (Toyota Corolla) as gifts. These are fully insured by our trusted partner, Consolidated Hallmark Insurance. These vehicles help to ensure consistency in the repayment option as it is a kind of economic empowerment.
The cars could be hired out for taxi (Uber or Bolt) and that ensures steady cash flow every month. By providing our low-income clients with an extra income channel, we are leading them on a wealth-creation journey which would not only boost their current earnings, but also position them to live a fuller life now and later.
Read also: Sit-at-home: Muna Real Estate moves conference date to November 3
Arguably, you have good knowledge and understanding of the Nigerian business environment. Could you share your experience operating in this environment in the last decade?
I am a passionate entrepreneur with over 10 years of experience in providing solutions to problems in the construction, marine equipment fabrications, and oil and gas sector in the South-South region of Nigeria. I have a comprehensive knowledge of key institutions’ success drivers as I have been responsible for strategy, planning and execution, optimizing key pre-process by mitigating financial and technical risks.
Before founding ATCO Homes, I had founded Atco Energy, an integrated Logistics, Retailing, Technical & Industrial energy solution company, with the flagship brand – Atcogas, currently at the forefront of the LPG value chain in Nigeria.
I studied Mathematics at Ambrose Alli University. I am also an alumnus of the Lagos Business School, and a volunteer and supporter of several local and international humanitarian groups. Recently, I received Archers Award powered by Arrows Leadership Development Foundation (ALDEF)/We Care Club Global whose mandate is to enrich humanity at all levels through the development of the leadership culture and positive behavioural changes. Currently, I am running some courses at the Harvard Business School.
Now, beyond the market development strategies you and other developers are putting in place, what do you think the government needs to do to support market players to bridge the housing gap?
Although ATCO Homes does not take loans from any commercial bank to finance its projects, I would still advise the government to provide financing opportunities for these players in order to increase their contributions to the economy.
Besides, the regulatory arms of the government can work out a support strategy for the industry by implementing a price-cushioning framework that will make building materials more affordable for commercial and private home builders.
These sector intervention programmes would help players build more affordable housing units for Nigerians. Considering the growing socio-economic challenges such as price inflation and displacement that is currently ravaging many households in the country, incentivizing tactical approach is needed. And more importantly, we believe that all hardworking citizens of Nigeria should be able to own at least a housing unit in a decent city.
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