Friday, 3 July 2020

THERE IS NO POSSIBILITY OF A COMMON MAN OWNING A PROPERTY IN NIGERIA, SAYS M. I. OKORO & ASSOCIATE BOSS, DR. MECKSON OKORO

Chief Dr. Meckson Okoro
The Chief Executive Officer of M.I. Okoro and Associates, Chief Dr. Meckson Okoro, is a major player in the real estate business with experience spanning over 30 years putting his business among the fastest growing real estate firms in the country. The world-class estate surveyor and valuer spoke to business reporters on how his startup has mitigated industry challenges to become a force to reckon with in the economy. He also discusses competition and basics of business growth.

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Background
While starting up our company, I had in mind to contribute to the growth of Nigeria’s economy through real estate consulting and quality service delivery. That focus has not changed since then. It is only that the policies of successive governments have been militating the realisation of such dreams. If you look at real estate management in Nigeria, M.I. Okoro is a very tall figure when you drop the name. To a very large extent, I consider myself and firm as having contributed immensely to the growth of real estate in Nigeria.

Corporate goals
We started the evaluation of institutional properties like that of universities. I felt that most of these properties are not valued and each time students go on rampage and damage properties, the schools’ administrations merely dip hand in funds to repair the damaged structures. I believe it was then that higher institutions started evaluating their properties and our firm was the first to introduce an insurance scheme for the University of Lagos, which was founded since 1962. It was a very big assignment and that gave the impetus to other universities to emulate the policy.

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Also talking about the Lagos Trade Fair complex, I was one of those in charge of relocating more than 100,000 traders. Our achievement, as a company, has been quite tremendous. In terms of internally generated revenue for Lagos State Government, they know our impact. We have assisted the Lagos State Government in ensuring the actualisation of Tejuoso Market and issuance of the property to prospective tenants. In real estates, we have developed certain services to many of our clients that I don’t need to mention their names on the pages of a newspaper. We were involved when the Federal Government called for an evaluation of all public assets all over the federation. We have done all manner of evaluation for AMCON, banks, corporate bodies, individuals and many more.

Challenges and risks
The major challenge is still that Nigerians are poor. There is little disposable income. People don’t have money to buy property and government policies are not helping matters. There is also the challenge of policies of house ownership in Nigeria. There is no possibility of a common man owning a property in Nigeria and this affects the growth of the profession and house delivery in Nigeria. I can call that political and financial challenges.

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We were not trained to develop for the poor. Yes, our job is to advise government to do that. Building for the poor is supposed to be taken care of by a deliberate policy that is called social housing infrastructure through a social housing fund which is strictly by government. There is nobody, including you that would do an investment in real estate and not borrow from the bank. The bank will want to see your cashflow before giving you such huge funds. Instead of the government focusing on building for the poor at a subsidised rate and empowering the local governments to do so, they neglect that. If it is a functional local government system, the local government is expected to even do the building of houses for people. If government had created a special funding for the social housing system, it would have been fine. But today, government builds to contest with private developers like us. It is not about attributing the blame to government, it is entirely the responsibility of government. Government has to bear over 120 percent of the burden of low cost housing.

Even when done, those who work in such parastatals allocate the houses to themselves and later sell at high prices, not giving to those that it was meant for. That is our experience with that. Government should ensure such houses are built for the people and that is what is done in other countries of the world. Again on the challenges, the way it is affecting everybody is the way it is affecting me. I am only one among the subset. For example, if all the money we are making is going into buying diesel to fuel the company, it is affecting me. We can’t look at that separately. Well, that is nothing but the struggle to grasp with government policies that are meant to kill businesses in Nigeria. Where this office is situated, we have been running on generator for many years. If I tell you how much my company pays on diesel, it is enough to pay staff salaries. That is a big leakage coupled with the fact that the Land Use Act created by the Obasanjo administration when he was the military Head of State, also, is a great barrier to our breakthrough in housing in this country. The Ministry of Finance has not thought it wise to know that since Nigeria’s independence, we are yet to have an efficient mortgage system that can guarantee efficient housing delivery. Building houses involves a lot of capital.

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Competition
The issue is that every business operator has its own strategy to survive in the market place. Despite the hardship and competitiveness of the business, we are still on top, when you measure us alongside the big estate valuers. We have got right our selling point which is to ensure we deliver effective quality service to our clients and once the client is happy, we do more business with them.

Addressing Nigeria’s real estate sector
The truth is that the economy is completely asleep. Nothing appears to be taking place right now. This started about one year before the 2015 election, when the Jonathan administration focused on how to survive the election and there was less focus on economic activities. The hype for change created a lot of anxiety and uncertainty in the market place and there was a total wait-and-see attitude on the part of investors. That is the level of the damage. The multiplicity of policies that are not healthy to the economy also created more shock for economic activities, particularly with forex trading and remittance of funds. Since Nigeria is not a socialist country, you cannot be at the middle of the game and create a goal post on polices that have started somersaulting. That is what has affected the economy of the nation. First of all, there has to be an enabling law to fine-tune the mortgage system. There has to be a serious legal framework and the government has to deliberately create primary mortgage institutions and power them, just like we power commercial banks.

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We are not creating the mortgage institutions like the ones Babangida created between 1992-1994. Yes, the idea was good but there was not an effective process to ensure they are doing the right thing. It all collapsed within two years because there was not an adequate legal framework for it. What the CBN is doing for commercial banks is what the Federal Mortgage banks ought to be doing to primary mortgage banks. Since the creation of the Federal Mortgage Bank, what can they say they have been able to achieve. As far as I am concerned, it is a waste pipe. It is either they are overhauled or they should be closed completely because they are building private interest and not national interest. (Sun)

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