N40bn Federal Secretariat continues to rot amid rising housing deficit

Amid ‘homelessness’ in Nigeria, particularly in Lagos, where housing demand-supply gap is conservatively put at three million units, the federal secretariat in Lagos valued at N40 billion has continued to waste away several years after it was acquired for redevelopment.

The secretariat, which provided office space for federal civil servants while Lagos served as federal capital, was part of the Federal Government properties in Lagos offloaded into the property market between 2003 and 2006 by the Olusegun Obasanjo administration in the country.

Wale Babalakin’s Resort International Limited which acquired the property had the intention of redeveloping it into residential properties but the redevelopment effort which would have provided homes for a good number of families was stalled by the Lagos State government.

Among other things, the state government demanded that Resort International must obtain a fresh Certificate of Occupancy (C of O) from the state government, irrespective of documents issued by the Federal Government on the property. The company was also required to apply for the consent of the Lagos governor on the property; apply for a change of use as well as a development permit from the state government.

The secretariat is just one of the numerous wasting national assets in the country but it stands out as a clear manifestation of how pecuniary interests rub off on national economic growth and development.

BusinessDay checks reveal that the value of that asset, including  the land and the physical structure, which has been wasting away since the federal capital was moved from Lagos to Abuja, over 30 years ago, is about N40 billion and it could have been more if the asset had been in use.

“That asset is standing on prime land; don’t forget that it is in Ikoyi which is one of the most expensive, if not the most expensive, locations in Nigeria”, an estate surveyor and valuer who pleaded anonymity told BusinessDay in an interview on the value of the asset.

“A lot of things are very difficult to understand in this country”, says Johnson Chukwuma, a structural engineer who is deeply worried that a high profile national asset like that secretariat is allowed to waste away and lose its value on daily basis because of parochial interests.

“I am still in doubt if it is really the Lagos State government that is holding down the redevelopment of that facility into residential apartments to provide homes for the residents of the state”, Chukwuma  wondered in an interview.  He explained that with a housing deficit estimated at 3 million units and avowed determination to provide housing for the residents through partnership with the private sector, the state should be encouraging the redevelopment of the facility and not stalling it.

Debo Ajani, an estate manager, agrees, stressing that time is now for all the parties to the transaction on the facility to come together with a view to resolving their differences  “and now that the Federal Government and Lagos State are under one party, I want to believe that this is the finest moment to get this issue resolved and allow the company to provide homes for Lasgosians as intended”.

Resort International had  considered the demand by the Lagos State government  inconsistent with the Development Lease Agreement (DLA) which it had entered into with the Federal Government  in  2006 which granted it 99 years’ lease to redevelop the secretarial complex into 48 luxury apartments.

It therefore, took the Federal Government to an Arbitration Tribunal where it claimed that it had suffered damages totalling N88 billion as a result of the breach of a clause of the DLA by the government.

In an award in favour of Resort  on December 3, 2015, the Tribunal, chaired by Fred Adeniyi Coker, an architect, supported by a legal practitioner, Yusuf Alli, a  Senior Advocate of Nigeria (SAN), and former Attorney General of the Federation, Abdullahi Ibrahim, ordered FG to pay N54 billion in damages to the company, and declared that  FG had failed in its obligations to the company under the DLA.

Close watchers of events around the secretariat complex  are of the view that FG was hamstrung by the Lagos state government, which once showed interest in acquiring the complex for certain vested interests, noting that trouble was in store by the time the complex was formally handed over to Resort.