In this interview, the Managing Director, Ogun Property Investment Corporation (OPIC), Babajide Odusolu advised developers must adjust their models towards reducing the incidents of crisis with landowners, adding that current Ogun administration is ready to partner with developers.
FOR more than two decades, your property development firm- Legacy Realties reigned supreme in the construction industry. How did it all start?
Legacy was founded in 1997 at a time when the property development sector was still in its infancy. At that time, the only development companies active were UPDC, HFP, and Crown Realties. Most people simply did personal or self-help construction. Legacy started by initiating a few single-user dwelling units and engaging in brokered land purchase transactions. In 2000, we initiated Heritage Place, Sangotedo, our first large scale project on a 20 hectare site in the area now known as Monastery Road. We were the very first investors to mobilize to site and commence work in that neck of the woods.
Unfortunately, due to funding constraints, we had to reduce the estate to four hectares and transfer portions to other investors. One of them being the very successful White Dove College. I am quite happy to see what that entire neighbourhood has become within a period of 16 years. Most people doubted us in 2001/2002, when we made projections and analysis categorically predicting the current state of growth in that axis.
From Sangotedo, we invested in a few other smaller projects, before partnering with the Ojomu Royal family to launch Ocean Bay Estate, Lafiaji, which was another transformative ground-breaking project in 2003. Ocean bay again was designed to trigger development of the Alpha Beach to Okun Ajah axis. That area in 2003 was quite simply a forest. Again no one gave us any chance of success, but God’s grace was with us and 13 years later, it succeeded beyond our expectation. Legacy’s successes are mere attribute to God’s endless grace and man’s audacity to dream and dare the seemingly impossible.
Did your course of study contribute to your success in real estate development? What was your strength and weakness during the period?
I was a graduate or Obafemi Awolowo University, Ile-ife, a qualified legal practitioner and engaged in corporate practice for a brief period of five years, before devoting myself exclusively to Legacy in 2001, it was a blessing in disguise. It prepared me to manage the vagaries of the Nigerian environment and survive the unending turbulence that came with it. At the same time, having been exposed to the importance of structure, I quickly learned to plan for the long haul, create sustainable structures, defer gratification but most importantly surround myself with capable people.
My key strength was the unwillingness to accept defeat. No challenge was insurmountable and my trust in God’s mercies preserved me. My greatest weakness was being a relatively young man in a new industry with limited infrastructural support. It limited my ability to tap all the opportunities that came my way; on the other hand it made me more bullish and unyielding, which was a key factor in our survival.
Is it true that you have rested the company before venturing into public service as the Managing Director, Ogun Property Investment Corporation (OPIC)?
I am a keen believer in the youth. It is not true that I wound up or rested the Legacy group. Rather I have a very dynamic management team that now runs the group, freeing me to dabble into other ventures and public service. As a matter of fact, they have taken legacy to a stronger and more secure footing and apart from being a benign investor, my role is now limited to challenging them to achieve far more with the resources available to them.
The invitation to help turn around the affairs of OPIC was both a call to service and a challenge to repeat and possibly exceed my previous milestones. I have been blessed to have a boss/governor in the person of Senator Ibikunle Amosun, whose drive and capacity to dream even exceeds mine. Working on the Ogun state team has been a worthwhile experience and I deeply appreciate the honour of the invitation.
What are the present challenge facing property developments in the country now?
The property development market has greatly evolved over the last 16 years. The housing and infrastructure needs remain unmet, but the cost of meeting them has risen. We still don’t have a viable mortgage system and that creates accessibility barriers to aspiring home owners. However this is balanced by the fact that more governments now realize that housing is a major driver for economic growth and people empowerment.
I am very optimistic, because the opportunities are abundant and resources while scarce remain available for bullish players to utilize. A classic example of what is achievable is Ogun State. We have been using our own resources and mostly local talent successfully delivered over 400 housing units across four major estate developments within a three-year period. Presently, the state has over 1500 housing units under development along with three major developments, none of which is below 50 hectares and all of which will be delivered within the next 24 months.
This is possible, because the governor had successfully married best private sector practices to public sector projects; attracted strong talent to take the lead and see it as a service to mankind and convinced investors to not just invest in Ogun state but buy-into the vision for a sustainable future.
Dealing with indigenous landowners and government in the acquisition of land has been a major headache to estate developers. What should be done to assist property development companies in this regard?
I think, more developers need to offer the indigenes a fairer deal. In the early 2000s when we started, resources were scarce, infrastructure was low and developers having invested so much could not afford to be generous to land owners. Now that many governments have invested in infrastructure, I think developers must adjust their models to reduce the incidents of crisis with landowners. Please note that this is distinct from land-grabbers who need to be aggressively controlled and dealt with!
In Ogun state, we see our local indigenes as partner investors; they in turn see the sincerity of commitment and support the projects. Two glaring examples of such partnerships is the successful completion of the first phase of President Muhammadu Buhari Estate by the Ministry of Housing, AA. Degun Workers estate by the housing corporation and New Makun City by OPIC.
Across all three, we had strong buy-in from the local communities and they in turn benefited with improved facilities; jobs and compensation as may be required. That is the minimum standard any developer should adhere to if they must have good community relations.
Similarly, governments are being forced to look inwards and land management is an easily targeted low hanging fruit. Developers must appreciate that fact and offer better terms in dealing with government. The days of offering pittance for premium value are gone. Most governments for example Ogun State now invest heavily in infrastructure and there is no basis for offering freebies to developers.
So I respectfully flip the coin and challenge developers to create win-win scenarios that make partnering with them a worthwhile consideration.
A new comer to Lagos-Shagamu corridor will notice the haphazard developments within the area, as the Corporation has failed to create model industrial and residential estates? Town planners had heaped the blame on government. How is the present administration in Ogun State correcting the anomaly? What steps have you taken to create new layouts and new towns?
On the Lagos- Sagamu axis, your statement/question is no longer true. Ogun state government has become hyper aggressive and bullish in addressing the squalor along that axis. We recognize that it is a viable asset and we are investing in it accordingly.
For example, a drive through Mowe-Ibafo will reveal that we have invested in a quality road network and used it to revamp the entire area. The MITROS City project anchored by the Ministry of Housing will do the same thing along the long bridge / Kara area while MTR Gardens being done by OPIC is doing so at Isheri. Within the last three years, property values in those neighbourhoods quadrupled because of these government’s initiatives.
Similarly, we have New Makun City at the Sagamu interchange, which is another new anchor development designed to further alter the outlook of that axis.
Government is determined over the next 18 months to change the perception and environment of the highway and these schemes are a foreshadowing of that transformation.
Well said, but property experts still believe that the state must break away from its past and recover missed opportunities through the provision of housing within the corridor, what arrangements do you have with private investors and developers to enhance the quality of lives of the inhabitants by providing excellent environment of international aesthetic standard?
Further to what I said earlier, we realize that our role is to serve as catalyst and concept proof provider. These schemes have successfully attracted other investors. We expect that over the next 24 months, a minimum of 1500 housing units priced between N5 million – N35 million in different cluster communities will be provided along the Lagos -Sagamu corridor.
Flooding has been a major challenge to property developers within Ibafon, Isheri North and other sites within the OPIC area; some property owners flee the area in the wake of the flood incidents. What concrete arrangements are being made to tackle the menace?
As you rightly said, Isheri, Ibafo had suffered flooding issues in the past. This was due to the non-provision of proper drainage channels in previous times. To appreciate the changes being created, visit MTR Gardens in Isheri. We are developing a two kilometres new road complete with arterial drainage, which will channelize and create a defined route for storm water in that area. Similarly part of the objectives of Mitros City is to properly channelize the river path and fix the perennial flooding challenges.
We recognize that these are expensive, costly undertakings and that is why they are linked to commercial projects. That way we deploy the revenue generated partly to fund such works across board and guarantee project sustainability.
Developers were caught up with Ogun state’s re-certification programme along Papalanto and Mowe axis, some claim that the levies charged are exorbitant. Is it true? Which incentives do government plan to give property developers to bring development to that axis?
On the recertification scheme, it is rather unfortunate that many developers got trapped by their own lack of due diligence and /or exuberance. You will be shocked to learn that many of the proposed developments in that axis, lacked planning approval or were located on government acquired land.
Incidentally, the problems started before the advent of this administration. The only difference is that having determined to upgrade and invest in infrastructure, the current administration insists on charging fair value for the property, which unfortunately many are unwilling to match. However I can assure you that anyone with sound documentation and willing to pay fair value is welcome to meet the special adviser/director -general, Ogun state bureau of land services. I can almost guarantee they will receive courteous and professional service.
The state’s landmark Homeowners Charter Programme is a classic example of this administration’s focus on innovative solutions to common challenges and they will receive the same quality of attention.
• The Guardian