CategoriesReal Estate

5 TIPS FOR LUXURY HOMEBUYERS

Are you looking to buy a luxury home or own a property?

The market for luxury homes in Nigeria is a specialized submarket that can be challenging to navigate due to its unique characteristics. With the advice that we are about to give you, the transition into the experience of luxury living will be as smooth as possible. There have been many new projects and additions to the market recently, and these are coming from a relatively small pool of premium homes.

In neighborhoods that fall into the higher quartile, real estate developers are consistently introducing novel projects catered to the luxury market and expanding the range of available alternatives for residential property types.

Here are luxury homeownership tips that are quick-win strategies for becoming a landlord.

Location and lifestyle – Luxury is a lifestyle. When it comes to prestige, nothing beats a luxury residence. The location of a luxury property or home you choose to purchase will determine the lifestyle to adopt. It could be a water view, a penthouse with a panoramic city view, a country home etc. The location you chose will influence your lifestyle.

Be patient – The finest offer on a luxury property that is worthwhile in terms of functionality, amenities, and preferences can take some time to find on the market. Interestingly, the market is unique to narrow your search as the market is still a growing in Nigeria. Investing millions of dollars in real estate should not be treated flippantly.

Title Document – do your due diligence about the property by finding out what title it confers and in the case of a deed of assignment, find out the unexpired term.

Investigate the property – Asking the proper questions is an important part of due diligence. Who are the developers? How is the building financed? Does the property follow zoning and building codes? When will the structure be finished? Etc. It’s vital to ask the appropriate questions, but it’s even more crucial to get professional advice.

Engage the services of an experienced luxury realtor – At Fine and Country, we are conversant with the affluent neighborhoods that are located within our market region and have an understanding of the intricate processes involved in negotiating and purchasing luxury real estate.

CategoriesReal Estate

WHAT IS THE IMPACT OF RISING CONSTRUCTION AND MATERIAL COSTS ON PROPERTY DEVELOPERS AND END USERS?

Construction materials have substantially increased and in some cases more than doubled due to inflation, local currency Naira devaluation, rising energy and transportation costs.

This ongoing volatility is placing pressure on the Nigerian construction industry, forcing many projects to be shelved and raising anxiety among developers, contractors and end users.

As indicated above, some projects especially those priced in local currency are being delayed or pulled off the market to enable developers re strategise on more effective sourcing, cost management measures and project delivery. Others are exploring and effecting price escalations, or price conversions from local currency to foreign currency to hedge against fluctuations.

IMPACT ON END USERS. WHAT GOES UP STAYS UP IN IKOYI AND ENVIRONS.

With the Nigerian inflation rate in excess of 19%, and the impact of the Naira devaluation being felt across the real estate estate sector, most end users are also being forced to re assess their investments.

However, for owner occupiers who are determined to move up the property ladder, whether down sizing, or up scaling in terms of neighbourhood and lifestyle, the current market presents a unique opportunity to shop for great deals. Cash buyers who can commit to quick deals have a negotiation advantage when dealing with old developer stock, while those buyers looking to buy older Ikoyi homes and similar environs may be better served making quick decisions before prices reach unwieldy heights.

Inevitably, with real estate in Lagos, especially in upmarket locations like Ikoyi, what goes up doesn’t come down.

NEW RELEASES ON ILABERE, and COOPER ROAD IKOYI
For homebuyers looking to move to Ikoyi, Banana Island, Victoria Garden City and similar neighbourhoods, Fine and Country West Africa has some new releases that are all well priced with motivated sellers.

ILABERE TERRACE HOME: This well priced 4 bedroom terrace corner piece located in Ikoyi comes with a designer garden and top amenities in excellent conditions.

Asking offers from 380M only until end of August, 2022.

MODERN TOWNHOUSE ON COOPER ROAD, IKOYI: Price on Application. Ideal for buy to let investor. The property has an existing corporate tenant.

CategoriesReal Estate

3 MAJOR REAL ESTATE INVESTMENT FACTORS

Real estate ownership involves more than just making a financial commitment, particularly when the property in question is intended to be occupied by residents. A sense of accomplishment and elevated social standing are both benefits of property ownership.

A variety of considerations need to be given prior to either the construction or purchase in real estate. The lifestyle that would be supported by the possible purchase and its location are the two aspects of these considerations that are most essential.

A significant factor to take into account is the location’s proximity to Central Business Districts, important facilities like hospitals and shopping malls, and upcoming construction projects.

Ikoyi and Victoria Island are in high demand as real estate options in Lagos State. Locations such as Banana Island, Twinlakes Estate, and Lakowe are guaranteed to provide investors with high returns on investment in the years to come. Other areas that fit geography and lifestyle include these areas.

Real estate’s durability and potential as an inflation hedge are two of its biggest draws.

Investors should focus on project completion, pre-construction groundwork, and land title documentation.

 

Project Completion – The aesthetic appeal of the property will be improved by selecting the best roof, wall, and floor finishes, which will also raise the investor’s rental income. Additionally, the asset’s usable life is extended. When fixing broken items frequently, using subpar products or finishing materials may seem cost-effective in the near term. On the other hand, the long-term cost of this strategy will be higher.

Pre-Construction Groundwork – Before construction can begin, a number of measures must be taken to guarantee the structure’s structural integrity and spare buyers the hassle of frequent building maintenance. Along with topographic surveying, soil examination is one of these actions. This test is essential since soil types vary by region, and the outcome will define the optimal construction approach and the types of structures that will perform best with the soil. Prior to any work, it is vital that both tests and surveys are undertaken in accordance with the requirements of the construction industry. As an investor or buyer, you must investigate and appraise the property prior to making a financial commitment.

Land Title Documents – Buyers and investors must possess the appropriate property title documents. Ensure that the Deed of Assignment is properly recorded where the property has been developed. Depending on the type of property, the title may vary, making it vital to check with real estate professionals. Purchasing a property is the simple part, but before claiming possession, the buyer must confirm that the title papers are not encumbered and, if necessary, secure the title documents.

CategoriesReal Estate

REVITALIZING NIGERIA’S REAL ESTATE DEAD CAPITAL

Hernando de Soto Polar, a Peruvian economist, was the first person to use the term “dead capital. These dead capital or assets needs to be unlocked to get the best out of its value. “Freeing up dead assets is releasing the potential of assets that are not currently yielding any returns. There are so many abandoned assets in Nigeria that the total value could reach $900 billion. The worth of the federal government’s abandoned properties is estimated to be somewhere around N230 billion, as stated by the Nigerian Institute of builders. Some of these dead assets include refineries that are not being utilized, so the country is not receiving a return on its investment. Other examples of such assets include the NITEL Building secretariat in Ikoyi, the national assembly complex at Tafawa Balewa square, and the Nigeria social insurance trust fund along the Lagos Badagary expressway, among others. When it comes to dead assets, the real estate market is affected by it because of its poor performance and lack of revenue which could have accumulated value/income if put into use.

National theatre undergoing $100m renovation renamed, to host UN event in November – Nigeria Transport Hub

People have the ability to borrow money against their properties in order to launch businesses if the real estate market is doing well. If they can be put to use, dead assets have the potential to become live assets. However, the existence of these dead assets presents an economic challenge because it makes it more difficult for the real estate market to flourish. The ability of individuals to trade assets is necessary for it to function properly. Before the developers can invest, they need to ensure that they have clear title to the land, and the buyer also needs to ensure that they will have an easy time transferring the property to them. The biggest problems with dead assets are not not having real estate titles, and not being able to get bank loans to invest in other things. Land is the ideal area to tax and the best place to develop a tax base from the perspective of the government trying to raise more tax revenue. The encouraging news is that the nation has begun the process of converting its dead assets into live assets. There is construction going on at a few of the refineries.

Nigeria has untapped potential in the real estate sector which can be revived especially with issues of unregistered land and dead assets.

With a big bottleneck slowing down the growth of the mortgage industry, the creation of wealth, and the overall growth of the economy, we think that unlocking dead assets and tapping into their potential will be a big step forward for the growth of the real estate sector. Hence, we recommend;

  • A comprehensive reform of the land tenure system to address, among other things, the time-consuming procedure of obtaining a Certificate of Occupancy.
  • Mortgage financing should be backed by special and revolving funds, and a legal framework should be set up to allow mortgage transactions.
  • Implement an electronic title registry for storage, retrieval, and quick verification of such titles to streamline operations and hasten the issue of title papers. Also, a new technology called blockchain can be used for title registry.
CategoriesReal Estate

UNIFIED EXCHANGE RATE AND ITS BENEFIT TO THE NIGERIAN REAL ESTATE SECTOR

The Central Bank of Nigeria (CBN) has been seeking, but to no avail, to direct scarce foreign funds into the highest-value uses. This, however, has been counterproductive on the nation. As a consequence of the Central Bank of Nigeria’s (CBN) policy, which includes limitations on FX trading, importers have been forced to acquire dollars at a higher value in order to bring the item/commodity into Nigeria. This is because the local supply is insufficient to fulfill demand. The foreign exchange market is distorted as a result of this, making it difficult to conduct business in certain industries. For instance, in the real estate sector, the majority of value added occurs in Nigeria say 70 -85%; however, you will still need to import some components for manufacturing, which developers/contractors or other members of the value chain are unable to do. This is because they do not have systematic way to access foreign exchange. If there was a standard exchange rate, conducting business in the real estate market would be less complicated. Concerns that have been raised in relation to the unpredictability of the naira may be alleviated if Nigeria maintained a stable foreign currency rate.

The following is a list of some of the benefits that come with having only one exchange rate.

  • It would make it simpler for Nigerians to access markets around the world.
  • It would boost the competitiveness of Nigerian industries by given then a to sell their goods and services with less restrictions on a global scale.
  • It would help to maintain the stability of the Naira, which is now in a weak position.
  • In addition to this, it provides Nigeria with access to a broader market.
  • Also, freer trade among Nigerians is one factor that could contribute to the country’s overall economic expansion.

The real estate industry is the most significant part of the economy. It not only helps individuals move out of poverty but also produces jobs. When the housing market does well, the rest of the economy tends to do well as a whole as well. It is absolutely necessary for the industry as a whole to band together and do what is necessary in order to advance the sector.

CategoriesReal Estate

SDGs ARE ESSENTIAL FOR REAL ESTATE DEVELOPMENT

The Gross Domestic Product is an intangible quantity that does not directly correlate to the well-being of humans. As an illustration, Nigeria’s gross domestic product grew by 6.22 percent in the year 2014. Using the Sustainable Development Goals as a lens for development in order to achieve economic success. The United Nations’ 17 Sustainable Development Goals (SDG) framework can contribute to the economic success of both the population as a whole and the country as a whole.

Below is the list of the 17 SDGs:

1: No Poverty

2: Zero Hunger

3: Good Health and Well-being

4: Quality Education

5: Gender Equality

6: Clean Water and Sanitation

7: Affordable and Clean Energy

8: Decent Work and Economic Growth

9: Industry, Innovation and Infrastructure

10: Reduced Inequality

11: Sustainable Cities and Communities

12: Responsible Consumption and Production

13: Climate Action

14: Life Below Water

15: Life on Land

16: Peace and Justice Strong Institutions

17: Partnerships to achieve the Goal

 

It is necessary to evaluate GDP, but it is equally important to measure the Sustainable Development Goals (SDG). Some of these Sustainable Development Goals (SDGs), such as having sustainable cities, clean water and sanitation, and decent work that contributes to economic growth, are vital for real estate. The part that the industry plays in the process of job creation, for instance when developing residential and commercial real estate. When it comes to real estate, responsible consumption and production means taking a look at the way homes are constructed to determine if they are suitable for our climate. When viewed through the lens of SDG, the importance of clean energy that is both affordable and accessible also applies to the real estate industry. What kind of power supply does the dwelling make use of? When thinking of renewable energy, solar power immediately comes to mind. If we are going to be successful in achieving these Sustainable Development Goals (SDGs), the real estate industry must be at the core of it all and must play a significant role in Nigeria.

 

CategoriesReal Estate

NIGERIA NEEDS TO FIND ITS UNIQUE DEVELOPMENT PATH FOR REAL ESTATE SUCCESS

Real estate is the sector of the economy in Nigeria that is most critical to the country’s overall prosperity. The world’s largest asset class is comprised of real estate properties. Real estate accounts for around two-thirds of the world’s total assets. Everyone requires a location to call home, and everyone requires a place of employment. In the world of covids, the location of one’s home and place of employment can be the same. In any economy, real estate is a major driver of economic activity in a favorable direction. When someone acquires a property, they will need to purchase furnishings for the home. Building real estate involves the sourcing of local materials, which offers employment opportunities. It is a significant sector of the economy that is essential for Nigeria’s continued development. In spite of the challenges that have been present in the real estate industry over the past two to three years, such as title problems, difficulties in gaining access to mortgages, and construction problems, we have since witnessed an extraordinary amount of real estate activities all over the country.

Despite the fact that there weren’t many activities in the sector four to five years ago, A study that was published by Lancet found that Nigeria is expected to have the world’s second-highest population by the year 2100. People are one of the most essential forces that drive the real estate market. The question “how many people are there in a country?” is an essential one to investigate. In Nigeria, the demand for real estate has been steadily growing over the course of the past several years.

In this piece, we will highlight eight different development paths that can lead to economic success in the real estate market in Nigeria.

 

  • Facilitate the expansion of service-based exports
  • An atmosphere that is more favorable to business
  • Tapping into the potential of the global diaspora
  • Low capital formation for investment
  • Development growth on a national scale
  • Transition from the informal to the formal sector
  • Bringing dormant assets back to life
  • Moving away from focusing on GDP and toward focusing on SDGs
CategoriesReal Estate tips & tricks

MULTI-STORY BUILDING TITLE OWNERSHIP

It is critical to consider the legal implications of any real estate development before proceeding. Any type of real estate transaction should be approached with consideration for the legal ramifications.

Understanding the optimal balance to be struck between the competing interests of developers and off-takers is essential.

Recognizing the significance of regulation as well as the limitations of regulation. The government should refrain from attempting to regulate everything.

The question of whether a strata title is appropriate under the law. Titles should be scrutinized more rigorously by the government. The title of the paper is a source of concern for off-takers. In multistory buildings, the problem is the title you get from a flat or condominium. Is it a sublease or a deed of assignment? If it were a sublease, then it means the developers still have a title over the property which is a risk. Government should look into this to give off-taker reassurance.

In this form of development, there is the issue of shared places. They are often dealt with on a contractual basis. In light of the potential threat that the developer may still be in control of the head title, should it be allowed to contract or should the state intervene and establish a certain presumption of shared ownership?

 

Our recommendations

  1. Joint ownership of common areas, with a distinction between the common areas themselves and the building structure itself. In this domain of shared areas, there should be some limited kind of statutory innovation to protect those who take advantage of the situation. The Government should take this into consideration.
  2. We advised that, once the development is complete, the developer should submit the original head title deed with the appropriate state government agency. Because the document in the possession of the developer allows the developer to use it as leverage or for any other purpose. There are instances in which all of the properties are owned by a single individual who holds all of the titles. As a result, we expect the government to operate in this area with minimum oversight and regulatory intervention.
  3. Insurance after the project is completed is an issue that needs to be addressed. When it comes to a multi-story building, who owns the insurable interest? These are the concerns that need to be addressed in order to move forward. Generally speaking, insurance can be obtained at any stage of real estate development, and it is permissible to do so in accordance with Sections 64 and 65 of the Insurance Act of 2003 – all public structures and all buildings under construction with more than two stories are required to be insured. Insurance is available to assist with every stage of the change in the value of real estate. There is insurance support available throughout the value chain of the real estate sector, and it can be taken advantage of.

Off-takers of multi-story or high-rise buildings should ask the right questions about the type of title they receive from the property of their interest.

At Fine and Country, we specialize in transaction management and advisory in the luxury real estate space. Contact us today to be of service.

 

PHONE

+234 818 169 7024
+234 809 600 0017

EMAIL

admin@fineandcountryng.com

CategoriesReal Estate

DEMAND FOR SMALLER OFFICE SPACES IN GRADE A BUILDINGS IS ON THE RISE

Companies are beginning to have more space than required for their employees as they migrate to a hybrid work paradigm. Despite the fact that working from home is becoming the new normal, most people still want to have a physical address for their business.

As we settle into this new normal, commercial offices have witnessed distinct variations in demand for office space. With sustainability, smart buildings, and remote, work likely to propel a new face of work, the commercial office sector is swiftly evolving. The global pandemic is still active, with a new strain of the virus known as the “Omicron variant”. Organizations are paying attention to health concerns while keeping a safe and social distance.

Many businesses are reconsidering their physical space requirements, both in the short and long term with a view to maximizing space utilization. Many businesses operate a hybrid model, with flexible work from home options and alternate days of virtual work. Interested clients typically inquire about 200–400 SQM of office space in Grade A buildings.

As a result, these are the top 6 reasons for the increased demand for smaller office spaces.

  • many businesses are now operating a hybrid model
  • flexible work from home options
  • alternate days of virtual work
  • Maximizing space utilization
  • Physical office presence
  • Wellness, leisure and health considerations

If you are looking to move into smaller office spaces in Ikoyi and Victoria Island, contact Fine and Country. We also recommend the Finery Suite for a team of small businesses in a shared office space.

CategoriesReal Estate

ARE LUXURY PROPERTIES OVERPRICED?

In the Nigerian real estate business, challenges bring opportunities.

The cost of a luxury property is one of the most commonly asked topics regarding it. This is the typical format for such enquiries.

Don’t you think some of these luxury residences are overvalued in actual terms, which is possibly why they’ve been vacant for so long?

Fine and Country West Africa  has seen two or three economic downturns in Nigeria. We entered the market in the midst of the first economic recession in 2008, when there appeared to be little demand. While it is true that there are many abandoned buildings, how can we assess the quality of these structures and what are the buildings in question? High-quality development are typically sold off after delivery or shortly thereafter. The average delivery time for a luxury development is 4 to 7 years. 4 Bourdillon, Tango towers, and Sisi Paris(lease only) are just a few examples of high-end luxury highrise buildings in Ikoyi that have been completely sold out or leased out with at least 90% occupancy, indicating a developer’s success.

When a luxury residential building is being developed and put to the market, the target market is the one per cent of the one per cent who can afford it. If the markets accept it and pay for it, it signifies that they have voted with their money. It’s a sign that their target market approves of them.

 

A flight to quality has taken place in the luxury real estate segment. Particularly in light of the terrible collapse of a building in Ikoyi in 2021. From the standpoint of market size in terms of our population, what Lagos symbolizes in terms of the Nigerian economy, West African economy, and African economy shows that we are only scratching the surface.

We don’t have many luxury high rise residential buildings in Lagos; they can simply be tallied and identified because Nigeria doesn’t have up to 50 tall buildings that may be classified as high rise luxury residential buildings.

Those who invest in the luxury market are accomplished individuals. There has been a philosophical approach to investing, since the pandemic. Some of these previously conservative investors are beginning to diversify their portfolios and changing their lifestyles.

Previously, the emphasis was on location, location, and location, but now the emphasis is on location, location, and lifestyle.

Investors in the upper quartile are showing a trend. These are some of the current trends:

  1. These investors are keeping their current residences.
  2. Some people are buying in locations like Lakowe and referring to their current residences as their city location.

Despite its location, Lakowe, a green constructed lifestyle community with a golf resort, has comparable pricing per square metre to luxury real estate developments in central locations like Ikoyi. The lifestyle estate is the concept. Similarly, if you wish to live there as a retirement home, Twin Lake Estate will provide a lifestyle living as well.

The cause for the vacancy in some of these high-end developments could be as follows:

  1. The properties are of poor quality.
  2. They did not construct in accordance with market demand and expectations.
  3. They are not represented by professionals.
  4. They aren’t a good match for the market.
CategoriesBlog Real Estate

THE DOLLAR ECONOMY & NAIRA ECONOMY OF THE UPPER QUARTILE OF REAL ESTATE IN NIGERIA

In Lagos’ real estate upper quartile, there is an increase in tall structures in the pipeline, under construction, and nearing completion. The premium segment, which includes Ikoyi, Banana Island, and Victoria Island, is referred to as the upper quartile. Due to the fluctuation around the Naira, there is a dichotomy between Naira and Dollar initiatives, with the result that intelligent investors tend to drift towards the Dollar economy in order to enhance their return on investments. Working with Naira-based projects is dangerous for investors, especially in the elite luxury market. Top developers in the luxury real estate business have been sticking with the dollar economy within the Nigerian market for the past 5 years.

In the luxury real estate market, there are micro divisions that are sometimes referred to as affordable luxury real estate. These developers frequently work in the luxury real estate Naira based sector. Despite being a tall building, these constructions are priced in Naira and range in height from 8 to 12 stories.

The more complex the construction and the investment necessary, the higher the cost of the building, which is reflected in the pricing. Average residential space prices in the luxury segment range from $2500 to $4500 per square metre, with more affordable options falling somewhere between $2850 and $3500 square metres. The more exclusive spaces, such as the penthouse, cost around 4500 per square metre and up.

Free From above of dollar bills in opened black envelope placed on stack of United states cash money as concept of personal income Stock Photo

Desperation does not fit with luxury in the luxury real estate market. These developers are willing to wait and collaborate with their intended/target audience. The delivery timeframe for these developments is typically 4–7 years.

Free Black Blue and Red Graph Illustration Stock Photo

 

Key things to Know about the Luxury Real Estate Market.

  1. The luxury real estate market is often reserved for long-term investors. Industrialists, financial institutions, and some corporations having capital in the country that is dedicated to the Nigerian market are among these investors.
  2. One strategy to diversify is to invest in luxury residential real estate, as this is an area where the fund’s worth can be preserved. Multinationals, public-private sector (Kanti Towers was sold to Nigerian Maritime Administration and Safety Agency (NIMASA) for $17.47 billion in 2021), corporate, and ultra-high net worth investors are among the commercial segments’ investors.The Famfa Oil and Dangote skyscraper is set to deliver in 2022, adding to the stock of Grade A office space in the city, although these investors aren’t typically thought of as developers.
  3. These investors plan to use these high-rise buildings for themselves or for a portion of their use, while others are looking for uptakers. These investors are patient and selective in who they allow inside their properties. They would sometimes keep the property for a long period until they found the right kind of client to occupy this space. In the commercial luxury market, this might cause market distortions in terms of vacancy rate, supply, demand, and conversion rate. Investors anxious about their Naira stack and not being able to convert it to dollars or take it out of the nation are increasingly turning to real estate as a safe haven. They may not have all of the finances, but they are willing to work together on large commercial and residential luxury space projects in terms of collaboration.
  4. In terms of commercial figures, it varies depending on the location, from Ikoyi to Victoria Island, which is reflected in their rates. Grade A, B, and other categories exist for office spaces, but at Fine and Country, we focus on Grade A office spaces.

 

Some of these office space’s developers, investors, and landlords weren’t as flexible a few years ago. However, with the downsizing and giving back of office spaces in the previous three years, particularly with COVID, landlords have become more practical, offering concessions such as rent free periods and fit out periods as a sort of discount. Because some of these assets are being retained to sell off to investors or sell into REITS, astute investors may desire to maintain a minimum price per square metre in the commercial sector.

 

As a result, rather than affecting the pricing of commercial office space, it is important to maintain/protect the pricing per square metre by offering concessions or other value areas.

CategoriesReal Estate

TOP 3 TRENDS IN LUXURY RESIDENTIAL DEVELOPMENT IN 2022

The ultra-high or super-luxury segment of real estate, such as 4 Bourdillon, has seen a lot of interest. For such ultra-high-end properties as the Belmonte, there is also a long waiting list of potential tenants. That being said, there is a demand in that regard. The type of developer and the quality of the development are important to investors and uptakers in this market. When the target audience commits to purchasing these properties, luxury developments that sell faster in this exclusive real estate space are those that have been voted on by the target audience. This indicates that the property meets market criteria in terms of location, lifestyle, quality, investment security, and prestige. When some luxury properties have a high vacancy rate, it’s not unreasonable to assume that the property does not meet the criteria of its target audience, which is the top 1% of the population. Luxury is not for everyone, and those who purchase it are well-versed in the art of purchasing exclusive real estate. There is an oversupply of luxury office space in the commercial market. When it comes to oversupply, corporations are cycling within the market’s available space, whether through downsizing, restructuring, a shift in strategy, or expansion. Oversupply simply indicates that corporations have a wide range of options to choose from, rather than being limited to specific buildings in the Grade A office space.

Free Roof Top Swimming Pool on Building Stock Photo

Especially in light of the tragic building collapse in Ikoyi in 2021, investors and uptakers would be more informed and inquisitive about their interests in 2022. Here are some of the top three luxury residential development trends for 2022.

In this space, there are a few trends to keep an eye on.

  1. Real estate players will be regulated and evaluated.
  2. Developers will be subjected to many greater restrictions in terms of what they may build, which must adhere to local zoning laws.
  3. In luxury real estate, particularly residential, people value location and exclusivity, but developers’ quality will now be prioritized.
CategoriesReal Estate

Fine and Country West Africa Real Estate Outlook : “Navigating the Changing Landscape of the Luxury Residential and Prime Office Market”

With the economy returning to normalcy post-COVID, the Real Estate sector’s GDP contribution increased by 15.43 % in the third quarter of 2021. However, increased cost of building materials, rise in the currency exchange rate, and inflation reached 15.63%  by December 2021 despite hitting a peak at 18.17% in 2021.

According to data retrieved from the African Development Bank, the Nigerian economy is expected to grow 2.9 percent in 2022. Also IMF predictions says that the Nigerian economy will increase by 2.7 percent in 2022, allowing GDP per capita to stabilize at current levels. The reason for this could be a rise in crude oil prices and production.

We are confident with the real estate market trend and that the sector will be typically bullish in 2022. Buyers and off takers are enthusiast about taking up space and new projects in the commercial and residential spaces are springing up all over the place, with 2022 as the anticipated delivery date of some top luxury projects.

It is expected that the real estate sector will have plenty of opportunities in 2022, as the real estate market continues to grow. Astute Investors will continue to invest money into all types of property investments, both notably luxury residential and grade-A office space. Because it is a pre-election year, the government is expected to play a significant role in policy formation to create an enabling climate for real estate investors at all levels of the value chain. This expectation extends to housing projects and interventions by the federal and state governments. However, due to unforeseen circumstances that may arise before and after the 2023 elections, some investors may expectedly adopt a “wait and see” approach.

Such an unforeseen event in the economy may be the withdrawal of oil subsidies, which could cause inflation and impair purchasing power, as well as other parts of the real estate value chain with increased building material costs, affecting developers and investors.

 

We anticipate that diaspora and foreign investors will be drawn to the real estate sector in 2022.

GDP Growth year on year 4.03%(year-on-year) Q3 2021 (Nigerian Bureau of Statistics)

GDP contribution real estate increased by 15.43% (quarter-on-quarter) Q3 2021 (Nigerian Bureau of Statistics)

Inflation rate December 2021 – 15.63% Q3 2021 (Nigerian Bureau of Statistics)

Projected economic growth 2.9 % in 2022(African Development Bank)

Projected economic growth 2.7 % in 2022(IMF)

 

 

 

Luxury Residential

Tenants are increasingly looking for water-front apartments within the Ikoyi/ Victoria Island axis, as well as ample parking and huge living areas. This trend is likely to persist. Since the Pandemic, tenants have been more meticulous with space, particularly when it comes to setting up a home office, due to the rise in hybrid work styles.

The catastrophic collapse of a residential building in Ikoyi has taught investors to ask the correct questions and safeguard their interests when buying a luxury property. Before committing their cash, we want investors to be better informed about any developments in their fields of interest.

However, because of the increasing cost of building materials we expect prices of apartment/homes to increase but demand will also increase, particularly from Diaspora buyers who would take advantage of the weak naira to purchase real estate.

The Belmonte, along with Cuddle by Cadwell on Bourdillon, will be completed in 2022.

 

LUXURY RESIDENTIAL IKOYI

PROPERTYASKING $
Belmonte1.6M and above
Empire Court1.2M and above
4 Bourdillon1.6M and above
Osborne Towers2M and above

 

PIPELINE LUXURY RESIDENTIAL IKOYI

PROPERTYLOCATIONSTATUSESTIMATED TIME OF DELIVERY
BelmonteBourdillonUnder Construction2022
Cuddle by CadwellBourdillonUnder Construction2022
The LuxuriaAlexandraUnder Construction2023
39 BourdillonBourdillonImplementation2025
Bourdillon HeightMoor roadImplementation2025
NO 27 GloverGlover roadUnder Construction2023

 

 

PIPELINE LUXURY RESIDENTIAL VICTORIA ISLAND

OFFICE BUILDINGLOCATIONSTATUSESTIMATED TIME OF DELIVERY
The Knights TowerAhmadu BelloUnder Construction2024
Azuri TowersEko AtlanticUnder Construction2022

 

2022 Anticipated Residential projects for Ikoyi and Victoria Island are Belmonte, Cuddle and Azuri Towers

Commercial Office Space

Because most organizations are adhering to tight health and safety procedures for their employees, the commercial office space has seen a gradual growth in uptake of space, resulting in the adoption of the hybrid style of work. However, we’ve seen businesses take up a lot of area and relocate from their current location. While some moved to get extra space, others had to give up some office space. According to our estimates, more businesses will occupy Grade A offices in 2022 as demand for large and small spaces grows.

We anticipate the completion of Famfa Tower in 2022, which will add to the pool of lettable space in Ikoyi.

The Nigerian Maritime Administration and Safety Agency’s purchase of Kanti Towers, Victoria Island, for N17.47 billion as its new headquarters in 2021 signals a surge in investor confidence, since inquiries to buy existing high-rise buildings in Ikoyi/ Victoria Island have increased.

However, because more stock is forecast in 2022, the uptake of office space may be slowed down. There are already existing stocks that are not being taken on the market as companies like BUA and Dangote are developing head offices.

 

OFFICE RATES IKOYI

OFFICE BUILDINGRATES /ASKING $REALISED $
On6Temple650600
Kings Towers1000850
Heritage Place750700
Alliance Place750700
No 47600550

 

PIPELINE OFFICE IKOYI

OFFICE BUILDINGLOCATIONSTATUSESTIMATED TIME OF DELIVERY
Famfa Oil TowerAlfred RewaneUnder Construction2022
Dangote HQAlfred RewaneUnder Construction2023
BUA GROUP HQAlfred RewaneUnder Construction2025
Meristem Securities OfficeGerrard roadUnder Construction2022
NDIC Head OfficeGlover roadUnder Construction2024
NO 27 GloverGlover roadUnder Construction2023

 

OFFICE RATES VICTORIA ISLAND

OFFICE BUILDINGRATES /ASKING $REALISED $
Postsquare450380
NestOil Towers800750
Greystone550450
The Wings700650
Number One700600

 

PIPELINE VICTORIA ISLAND

OFFICE BUILDINGLOCATIONSTATUSESTIMATED TIME OF DELIVERY
Dover TowerAjose AdeogunUnder Construction2023
Crystal TowerAdemola AdetokunboUnder Construction2024
Head Office Development for First Pension Custodian Nigeria LimitedAkin AdesolaUnder Construction2023
40 Adetokunbo Ademola StreetAdemola AdetokunboUnder Construction2022
Stanbic IBTC HQOzumba MbadiweUnder Construction2024

 

2022 Anticipated office projects for Ikoyi and Victoria Island are Famfa Oil & Meristem Securities Office

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