Lekki Gardens: Looking beyond the building collapse

Since after the collapse of a five-storey building, still under construction, in the Lekki area of Lagos with loss of lives and varying degrees of injury, Lekki Gardens Limited, developers of the building, has been in the eye of the storm with some people making scathing comments on everything and anything that concerns the company. CHUKA UROKO looks beyond the unfortunate incident and those comments and highlights some of the company’s positive attributes and the impact it has made in Nigeria’s housing market where its affordability mantra has earned it the sobriquet ‘game changer’ in a restricted market.

In this part of the world, emotion generally run high and temper higher when certain incidents happen, more so when lives are lost in a way that is either inexplicable or incomprehensible or both. One of such incidents is the collapse of a five-storey building in the Lekki area of Lagos recently.

The building, still under construction, was one among many others in an estate being developed and promoted by Lekki Gardens Limited, a relatively new entrant into Nigerian real estate market, which in its four-year history as developer has taken the market by storm with its unique housing model.

Nigerians have seen building collapse incidents in the past, especially in the major cities. In September 2014, a six-storey guest house collapsed at the Synagogue Church of All Nations (SCOAN) in the Ikotun area of Lagos, killing over 100 people including foreign nationals. Before that, several other building collapse incidents had happened, raising concerns over the quality of materials imported into the country for building purposes, the structural stability of buildings and the integrity of regulatory and supervisory agencies in the in the country’s building and construction industry.

Expectedly, there has been a flurry of comments, questions, allegations and general outcry from different quarters including the government on the Lekki Gardens incident and this is, arguably, due to the magnitude of the losses suffered and, most probably, due to some reservations, misunderstanding and misinterpretation of  the company as a major player in housing development.

“What happened was quite unfortunate because those who died are people’s brothers, fathers, mothers, children, uncles, etc, but what has happened has happened and I believe some lessons have been learnt”, says Mojisola Saka, CEO, Soulcoms Limited, who also laments that the company which has done so much to help the housing market in Nigeria is passing through this trying time.

Since after the early morning March 8 incident, the authorities of the Lagos State government have, understandably,  come down hard on the company— arrested its CEO, sealed off the estate and ordered an integrity test on all the houses on the estate with a view to ascertaining their structural stability.

Perhaps, it is still early days to ascertain what government’s intensions are, but when the law takes its course, it is still pertinent not to forget where we are as a nation with respect to homeownership, job creation, wealth generation, infrastructure provision and community development.

On account of high poverty level, high cost of funds and low mortgage access, Nigeria has a yawning housing demand-supply gap estimated at 17 million units, low homeownership level at a little above 10 percent and housing stock that is said to be below 12 million units.

Though attempts have been made and are still being made at public and private sector level to close these lacunas in the housing sector, none has been as strident, bullish, ambitious and all-encompassing as efforts by Lekki Gardens to put as many Nigerians as possible on homeownership ladder.

Determined to break the affordability jinx that defines the Nigerian housing market, this company has, in the last four years, frequently visited the market with seemingly impossible propositions—offering products at ‘rock-bottom’ prices in locations that are otherwise exclusively preserved for the rich.

This, clearly, is the source of the reservations that some people have expressed about the company’s housing model, but Richard Nyong, the company’s CEO explains that “the customer is at the centre of our development considerations, and in every step we take, we ask ourselves what we can do to save money for the customer”, which is why the company’s house  prices in Ikoyi can hardly buy  land alone in Victoria Island. The company, he explained further, does not believe in greed or excessive profit and so, “we are okay with  just N10 million profit from a  project where we could make N30 million”.

The company has developed a housing delivery model that enables it to deliver housing at relatively low prices which is why close market watchers are advising the authorities of Lagos State government that, in whatever they may want to do with the company, they should not stop or kill this model that has been ‘mass-producing’ housing and solving both social and economic problems in the state.

A look at its first project called Lekki Gardens relative to neighbouring estates shows that it is far ahead in terms of affordable pricing. Their close neighbours in that estate include Grenadines Estate, Crown Estates, Royal Gardens, and Fountain Springville developed by HFP Engineering and Capital Alliance Property Investment Company

Whereas a three-bedroom duplex at Lekki Gardens sells for N13.9 million, Grenadines Estate’s three-bedroom terrace houses sell for N19.8 million and an additional development fee of N2 million. At Crown Estate, about three minutes drive away, a three-bedroom house sells for N38 million while four-bedroom house sells for N45 million;  a plot of land at Royal Garden, owned by Trojan Properties, sells for about N60 million while at Fountain Springville, a plot of land sells for N16.5 million.

The company has, from one estate of 350 housing units in January 2012; two estates of 2,000 housing units in January 2013; 21 projects with about 7,000 housing units in 2014, developed a total of 48 projects accounting for 15,000 housing units sold so far and this is no mean feat in Nigeria.

 “Our presence in the industry has dropped house prices by as much as 50 percent across all the locations of our projects and we are happy we are pioneering that change,” Nyong says, adding that the company’s  lower prices and effective marketing strategy are part of well-thought out strategies which distinguish the company from its contemporaries.

The company is optimistic of delivering, at least, 100,000 housing units in the next two to three years, even as it targets one million units in the next eight years, and in doing all these, it is also creating jobs across all the housing delivery value chain. “By the last count, we have created over 10,000 jobs in our various projects locations in the country”, the CEO reveals, adding that they have also constructed roads in some communities where they operate.

CHUKA UROKO