VOICES FROM THE SECTOR: CONSTRUCTION AND REAL ESTATE
What is the brief history and the focus of Dantata Town Developer?
Dantata Town Developers is focused on both affordable and luxury housing. We have been in business since 2012. Notably, we built the Dantata Estate Housing KUBWA, which contains about 1,000 units. At present, we are building about 890 units of housing in Gwarimpha II in Abuja called “The District.” It has about six different buildings with a commercial area in the center, as well as a healthcare center. The expected completion timeframe is three years. We build most of our units on our own, though we sometimes sell service plots for others to develop.
What is the composition of your portfolio?
We try to partner with other institutional investors, though we work mainly with individuals. Another problem is lack of funding for individuals; the maximum the government gives is NGN15 million, which is not enough to buy a house in Abuja, where most houses go for a minimum of NGN20 million.
What projects is Construction Kaiser currently involved in?
We are involved in some PPP projects as building contractors. For example, we are working on a five-story car park in Lagos with a partner that won the concession. Also, we recently completed a similar project in Ikeja, next to Computer Village, measuring about 2,000sqm per level. Similarly, we are doing another project in Ikoyi that measures 3,000sqm with three floors of parking and four floors of commercial space. Moreover, we recently handed over a logistics base that will be used by Total in a new area measuring around 2,000sqm.
What is Kaiser Construction's edge over its competition?
At Kaiser, we try to give added value; we do not compete solely on price. That is why we are deploying a shared-value strategy. We are trying to create a social impact while pursuing economic benefit. For example, in 2016, we started an annual summer camp for children aged 13-18 from across Nigeria. Earlier in 2018, we also signed an agreement with the University of Lagos to grant scholarships to students, mostly underprivileged, to study construction. We want more Nigerians working in the construction industry because it is a huge employer.
How would you describe the composition of your portfolio?
Around 70% of our client base for projects for commercial real estate are corporates, but for residential projects the ratio is closer to 50/50. We have the regular Joe who walks in off the street to buy an apartment in Lekki for instance and, at the same time, a Japanese company inspecting properties through us and looking to buy 12 apartments. In terms of our cash flow volume, corporate clients make up more than 80% because they tend to buy bigger properties.
What are some of the projects that you are currently working on?
We are consultants for Trinity Towers, which is the first tri-tower building in West Africa, held by a transfer beam. It is a mixed-use project with a large 5,000 seated auditorium on the first five floors. There are 12 floors in total, and the space is split into office, residential, and retail spaces. In terms of entertainment, there will be a movie theater and a bowling alley. Moreover, it will have a rooftop helipad, swimming pool, and tennis court.
What is the role of traditional rulers and figures in the politics and business of Lagos State and Nigeria?
We are the custodian of our culture and people. One of our roles is to advise the government; we are closer to the people, and, therefore, we are able to understand exactly what the masses need and desire. Our purpose is to try to ensure that the needs of the common man are accounted for in these platforms. We are interested in creating a better Lagos and a better Nigeria.
Your family has historically owned land at Elegushi beach, and this waterfront is now a major tourist attraction in Lagos. How do you maintain it?
Things have changed, and we are trying to improve the way things were done before. Most beaches had no basic infrastructure before; however, I have tried to change the face of Elegushi beach. We have revamped the facilities and safety infrastructure, and, as a result, the nightlife around the beach is thriving. Along with that, we have created a complaint center and we are redeveloping the road network and the entertainment sector. We are currently reviewing applications from a number of international hospitality companies for further development.
What is Nigeria's importance in Mixta's global portfolio?
Nigeria remains one of Mixta's most critical arms because of the country's sheer population size. At present, Nigeria makes up over 90% of the entire Mixta asset base and represents the highest amount of land within Mixta, at almost 16 million sqm.
You focus on middle- and lower-end projects in Nigeria. Is that due to a specific need?
Why would you provide housing for the top 10% when 90% of Nigeria's population needs affordable housing? There is a shortage of 17 million houses, and the real demand in Nigeria is a minimum of 6-7 million houses. This means building 7 million units is enough to keep the country busy for the next 10-20 years.
What else can you tell us about your current projects?
Most developers concentrate on Lagos and Port Harcourt. We have always made the argument that with the right level of government support, there is enough of a market in every secondary city. For example, the Edo State government extended an invitation to us to come invest, and although people questioned that, we went ahead after taking into account the fact that out of the USD25 billion that flows into Nigeria, about 25% goes to Edo State.
VOICES FROM THE SECTOR: CONSTRUCTION AND REAL ESTATE
TABLE OF CONTENTS
Interview
Hamzat Ayodele Subair, Executive Chairman, Lagos Internal Revenue Service (LIRS)
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New Beginnings
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John Opubor , Managing Partner, Coronation Capital
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Investment & Asset Management
Nigeria's leading financial institutions are investing in far more than energy and commodity-related assets, with strategic commitments to education, health and pharmaceuticals, and other brick-and-mortar industries that keep the Nigerian and West African economies churning.
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Make or Break
Though pricing mechanisms can protect consumers in early stages and help certain parts of the sector off the ground, too often they turn to stone and create permanent (dis)incentive structures that prevent more effective long-term willing-buyer, willing-seller dynamics.
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