FG to boost real estate investments via policies, SMEs – Fashola

The federal government of Nigeria has said that government is committed to boosting investment in the Real Estate Investment Trust (REIT) through sustained commitment to creating more investment opportunities in the sector.

This was coming as experts bemoan high tax regime, poor regulation, land ownership, competition from treasury bills among other factors as inhibiting growth and investment in Real Estate Investment Trust (REIT) in Nigeria.

Minister of Power, Works and Housing, Mr. Babatunde Raji Fashola, at the median Sub-Saharan Africa Real Estate Investment Trust (Reits) Conference, at the Nigerian Stock

Exchange (NSE) Lagos, assured that government is committed to reducing the challenges and also boost vibrancy of REITs in the country.

Fashola in his address at the REIT conference themed “Real Estate Investment In Sub-Saharan Africa: The Role Of The Capital Market” said, though it may appear difficult for government to provide all housing solutions, but maintained that with the establishment of structures, such as best practices, as obtainable in the United Kingdom, Canada and Singapore, affordable housing is affordable in Nigeria, via ownership and rental agreement best practices.

Fashola said that government plans to boost liquidity in the sector by supporting massive building materials construction and construction of houses, which stands to boost REIT ratings, confidence, income and returns on investments.

“Our plan for sustainable supply is to standardize designs and industrialize production. Here is where I have news for small and medium scale businesses who are in this line of business” Fashola said “By standardizing fittings such as doors, windows, roofing sheets, tiles and other components, it allows us to use these standards to stimulate local mass production of fittings and finishing to meet the demands of mass housing’

The minister said that while, the government’s resolve not to use imported materials in housing schemes, where there are local alternatives is aimed at diversifying the economy.
He said that industrializing production of of building materials locally and engaging Nigerian engineers would not only boost emergence of more estates, but further enhance earnings and sustainability.

Mr. Oscar Onyema, CEO Nigerian Stock Exchange in his address said that according to Ernest & Young report of 2016, global market capitalization of REITs now stands at approximately US$1.7trillion from US$734b in 2010.

Onyema said that Africa’s real estate markets are well positioned for a long-term growth based on significant supply deficit across the continent.