Despite the current recession, there are a lot of untapped opportunities in the Nigerian real estate sector. The Real Estate stakeholders, at a recent event, highlighted some untapped opportunities in the sector. According to them, the real Estate market is a large hub, that we can all enjoy. Nigeria’s growing population currently estimated at 182 million holds great potential for the real estate sector to provide adequate housing for the country.
The Nigerian commercial floor space is still low–currently estimated at 700, 000 m2, compared to South Africa’s total commercial floor space of 23, 000, 000 m2, said Mr. Femi Babatunde. This indicates the investment potentials within this sector. A rising trend indicated during the conference is the increase in the demand for shared floors. Situations, where companies would demand a whole floor or two, are reducing. The real estate experts advised that investors should explore the option of dividing floor spaces into smaller sections. They explained it is easier to sell that way and the risk is lower.
In the residential space, the experts highlighted the gap in the mid-size housing sector. There is a significant market, which is 30 million to 100 million, said Hakeem Ogunniran, Managing Director of UPDC Plc.
There is an increased demand for serviced apartments between the premium and super premium clients. “People are looking for serviced apartments, they want large floor spaces in high-rise buildings”, said Mr. Andrea Geday, Managing Director of Elalan Construction. Most of the customers within that space are business travelers.
The Nigeria retail space has experienced rapid development over the years. Nigeria now has over 25 shopping malls. A distasteful fact is that the investment by Nigerians within the space is low. Foreign private equity firms undertake most of the retail space developments, making the cost of developing retail spaces higher. It, however, highlighted that the recently completed Maryland Mall was developed and financed by Nigerians.
Among all the experts, a common observation is customers now desire a higher value for their money than before. Mr. Ogunniran said, “We all have to rethink our value proposition- today, it is what the customer thinks, not what you think.”
“2017 is going to be a very tough year. We should be prepared to look beyond the challenges”, said Mr. Hakeem Ogunniran.
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