‘Uptick in luxury property market demand to set in soon’
With over 500 vacant buildings in Ikoyi alone, this surely is not the best times for luxury property market yet ANDREA GEDEY, Managing Director of El Alan Construction Company, one of the promoters of the $70million 4Bourdillon luxury real estate in Ikoyi, Lagos hopes an uptick in demand will set in soon. He points out that now is the best opportunity to get the best value on investments and also shares reasons for his optimism. He speaks with ISAAC ANYAOGU
Tell us about El-Alan; what do you do?
El-Alan Construction Company is over 30 years old. It was registered in 1982. It started operations in 1984 and we have managed to survive and grow. People started hearing about us a few years back through our improved marketing strategy; we put signboards and became more visible but very few people have heard of us.
At the initial stage we were on a growth path until we got involved in government contract and there we got hit very badly and so we refocused our business and diversified into many other businesses.
Al-Elan is a group that consists of a construction outfit, electrical and mechanical outfit called VACC Technical Limited, and a facility management outfit called Provast Limited. We have our own woodwork factory called Woodstyles Limited, and we founded our own vocational school called Etiwa Vocational Training School and these are independent companies running on their own. All the companies are involved in the 4Bourdillon project and all the companies in association with the CHI Group.
You play in the luxury end property market which has the greatest challenge now; how have you been able to cope?
We really target the highest end of the luxury market and our targeted clients are not people who rely on their businesses or their cash-flow to buy into our developments. It is more of people who want to buy a permanent home or shifting from houses to serviced accommodations.
We are affected by the economic slowdown but our clients are people who already have the money and they are either thinking of buying a home or they already have a home they want to upgrade or they want to sell and buy as well; so it is really for the high end market.
4Bourdillon is a unique product, there is nothing like it in the market today and I don’t think there will be anything like it soon.
So what makes it unique?
One, the building is unique; it is very high; it is 110 meters high although it is 25 floors but the distance between floor and ceiling makes it much higher than the standard. It is almost equivalent to 30-storey building; so I think it is the highest in the area. Anyway, this is the highest allowed in Ikoyi.
Also it has a basement that was very technical to execute. We have to do sheet piling and it involved a lot of techniques not commonly used in Nigeria. The finishing is also very high end; we are going to put windows from floor to ceiling, very thick glass of the best quality. There will be central air conditioners and we will have it in every flat with independent controls in every room. Our tiles are 1.2 by 1.2meters and the best quality.
What is the cost involved?
You see, we are doing this basically to showcase our abilities. Chivita and El-Alan decided to bring in the highest end product. The building construction alone will cost $65million dollars and the total cost of development will be in excess of $70million.
But there seems to be a slump in demand for residential buildings in Ikoyi, growth seems to have stagnated; are you confident that you will get returns on investments?
The real estate market is not like the fast moving consumer goods (FMCG) market. That means it is not mass consumption. The cycle in real estate is usually seven years; between the time you conceive a project until the time you deliver, it could take you about four or five years, so it is not instant. In any case, the best time to invest is today for the people who have cash, especially for land and property.
There will always be up and down and by the time this project is finished, I expect that things will start to pick up and we will have turned a corner on the current slump. We reached the top end of that curve in 2008 and since then it has been going down; now we are at the bottom, so the only way to go now is up. There are over 500 vacant properties in Ikoyi but then they are not all of the same quality.
And that’s the concern of some real estate experts, who say the quality of some of these properties discourage patronage, do you share that view?
I can assure you it is not our property and this is why we are still selling even today. Of course, there are many buildings with poor quality but people who patronise us are buying for the quality and the after service. We help them to fix whatever issues the property develops; it is our responsibility to fix it.
There is a growing movement to include green features in buildings; do your properties reflect this trend?
Yes, even though 4Bourdillon will not be certified as green building but all the design features that we are implementing are green. The building is energy efficient because of the type of air conditioning we are installing. The whole building is covered with glass, there is no use of paint, external facade of the building is going to be either tiles or aluminium. We recycle water, have sewage treatment, so all the features of green building are there.
What about power, how are you dealing with the endemic problem?
The problem is really humongous. The cost of diesel per flat is over N150,000 per month, to maintain all the 800 units. We will be connected to the regular power supply but we will also run generators. Everything will be managed from a central location. There will be two redundancies
Apart from 4Bourdillion, are there other building projects your company is carrying out at the moment; what are your future prospects?
Though now is not the time, we are thinking of going into low and medium cost development. Low cost is a real challenge in this part of the world because of the challenge in defining it. For us, low cost is about N50 million, but not many people can afford that. But we will keep on exploring ways to make our buildings more efficient using latest building technology.
CHUKA UROKO