ODU’A UNVEILS THE ODU’A UNVEILS THE ODU’A UNVEILS THE ODU’A UNVEILS THE NEW ALMOND COURT NEW ALMOND COURT NEW ALMOND COURT NEW ALMOND COURT Odu’a has taken an-other giant stride in her Property Redevelop-ment Programme (PRP) with the formal com-missioning of Almond Court. Almond Court is a luxury estate of 10-Unit of 4-bedroom du-plex built on a 5,300 square meter land at Quarter 1013, Agodi GRA, Ibadan that

... Continued on Page 7... Continued on Page 7... Continued on Page 7... Continued on Page 7

SPECIAL FOCUS ON REAL ESTATE SUB - SECTOR IN NIGERIA

GENERAL ECONOMIC FACTS ABOUT THE REAL ESTATE SECTOR AND CHALLENGES FACING THE INDUSTRY

The Nigerian real estate and property market is a fast growing one with the Nige-rian population growing rap-idly and steadily over the last few years and expected to continue for a long time to come. Following the Nigerian stock market crash of 2008, many investors have moved their money into real estate and properties because they believe it is more secure and profitable than most other kinds of investments. As a result of this, push property values in areas like Lagos

are expected to continue rising plus the fact that land is becoming ever scarce and population is expected to shoot up. Also, foreign direct investment is expected to increase sharply within the next 10 years meaning that accommodation and proper-ties will become scarce and very expensive with property owners becoming rich. CLASSIFICATION OF THE CLASSIFICATION OF THE CLASSIFICATION OF THE CLASSIFICATION OF THE REAL ESTATE SECTORREAL ESTATE SECTORREAL ESTATE SECTORREAL ESTATE SECTOR The sector can be broken down into two major classes

of properties: - the low end and the high end. The low end consists of places of low develop-ment which are driven by investments from indi-viduals and few corpo-rate bodies (such as resi-dential buildings) while the high end comprises of those areas where aggressive and high value investments into real estate properties are made. ...Continued on page 4...Continued on page 4...Continued on page 4...Continued on page 4

June ,2012

Volume 1, Issue 12

Global Economic Update

2

Domestic Economy Update

3

Research on Real Estate Sub - Sector in Nigeria

4-6

Business Update & Subsidiary Reports

7

Macro Economic Indicator

8

INSIDE THIS ISSUE:

Economic & Business Monitor

ODU’A INVESTMENT COMPANY LIMITED

SECOND QUARTER SPECIAL EDITION

The New Face of Almond Court

US AGRICULTURE COMPANIES TO IN-US AGRICULTURE COMPANIES TO IN-US AGRICULTURE COMPANIES TO IN-US AGRICULTURE COMPANIES TO IN-VEST $150M IN AFRICAVEST $150M IN AFRICAVEST $150M IN AFRICAVEST $150M IN AFRICA

A group of US seed, chemical and equipment companies will invest at least $150 million

over the next few years into African agricultural projects and products. The investments pledged by DuPont, Mon-santo, Cargill and others are part of an overall $3 billion effort by companies around the world announced by Presi-dent Barack Obama. Along with com-panies from India, Israel, Switzerland, Norway and the United Kingdom, and 20 companies from Africa, the corpora-tions have committed some $3 billion for projects to help farmers in the de-veloping world build local markets and improve productivity. The United Na-tions has said that by 2030, the world will need at least 50 percent more food, 45 percent more energy and 30 percent more water. Without these resources, it said, up to 3 billion peo-ple would probably be condemned into poverty. Capitalizing on food demand in Africa also holds strong profit poten-tial. Corporate leaders stated that Monsanto, the world's largest seed company, said it also was committing millions to Africa. Monsanto will invest about $50 million over the next 10 years in several countries to support African agricultural development and growth, officials said. Cargill is invest-ing in two projects in Mozambique fo-cused on increasing grain yields for small farmers and on training and edu-cation in farm communities. AGCO, a U.S.-based farm equipment company, plans to invest $100 million over the next three years to improve farm op-erations in Ethiopia, Ghana, Kenya and other African countries. Among the international players, Norway's Yara International is planning a $2 billion fertilizer production facility in Africa and is spending $20 million to build a port in Tanzania that will help expand its fertilizer delivery network through-out southern Africa. The Swiss com-pany Syngenta AG said it would invest more than $500 million in Africa. Over the next 10 years, Syngenta expects to build a $1 billion business in Africa. Source: Source: Source: Source: Business Day, May 19, 2012Business Day, May 19, 2012Business Day, May 19, 2012Business Day, May 19, 2012

GLOBAL ECONOMIC UPDATE Page 2 VOLUME 1 , ISSUE 12

GLOBAL ECONOMY: GLOBAL ECONOMY: GLOBAL ECONOMY: GLOBAL ECONOMY: RISKS REMAIN, RISKS REMAIN, RISKS REMAIN, RISKS REMAIN, AMIDST SLOW RECOVERYAMIDST SLOW RECOVERYAMIDST SLOW RECOVERYAMIDST SLOW RECOVERY

E conomies around the world have struggled to gain momentum

through the first half year of 2012. Recent economic data from Euro Area shows that it narrowly avoided reces-sion in Quarter 1, 2012. The most

pressing issue in the Euro Area is the ongoing uncertainties in the banking sector and finding solution to the sov-ereign debt pressures faced by a number of Member States. The uncer-tainties in Europe Area is also impact-ing on growth worldwide. For in-stance, the economic performance of US is slowing. Annualized growth for Q2 2012 has been revised down from 2.2 percent to 1.9 percent and most business surveys indicate a slowdown demand and investment. In US, em-ployment growth has also been slowed with the unemployment rate that remained unchanged at 8.2 per-cent. Current problems in the Euro Area as well as in emerging economies mean that US is seen as a ’safe haven’ and government has benefitted from low borrowing costs. However, US deficit stood at $1.3 trillion (or 8.6 percent of GDP) at the end of 2011 and a period of adjustments cannot be post-poned indefinitely. The greatest cur-rent concerns relates to the so-called “fiscal cliff” that US faces at the end of 2012 and the potential implica-tions that this could have if the recov-ery remains fragile.

Unsurprisingly, the general economic slowdown now seems to be spreading to emerging markets. Growth in emerg-ing markets has been slowing down for two key reasons. Firstly, the uncertain-ties in Europe has had impact on their trade and exports-led growth and sec-ondly, domestic pressures have acted to dampen local demand. It is clear

that the Euro Area have acted as a drag on exports as China, India and Brazil send 20 percent of their exports to Europe. United Kingdom economy is also ex-periencing a massive GDP decline. The UK economy grew by 0.8 percent dur-ing 2011 with a contraction of 0.4 per-cent in the last quarter of the year. In Q1 2012, output fell by a further 0.3 percent. The preliminary estimate for Q2 2012 shows that UK GDP fell by a further 0.7 percent confirming that UK is now in a relatively significant double dip recession. In conclusion, global economy is pre-dicted to remain fragile this year due to ongoing Euro Area uncertainties, deleveraging taking place across many advanced economies and continued fiscal consolidation. Headwinds also exist in the form of challenges in the US economy and emerging markets. On the upside, a resolution of the Euro crisis could act as the catalyst for in-vestment and growth releasing invest-ment and growth potentials that is on hold due to current uncertainties.

Sources: www.scotland.gov.uk, IMF, Sources: www.scotland.gov.uk, IMF, Sources: www.scotland.gov.uk, IMF, Sources: www.scotland.gov.uk, IMF, Times Magazine, MPC reportTimes Magazine, MPC reportTimes Magazine, MPC reportTimes Magazine, MPC report

VOLUME 1 , ISSUE 12

mination to turn Osun to the food bas-ket of the country. Hermanne Onko Aik-ens, agriculture minister of the state of Saxony Anhalt, is leading talks with Aregbesola on how the two states can explore areas of cooperation on agricul-tural investments in Osun State. In No-vember last year, Aregbesola also had led a delegation to Zambia on a drive to establish abattoir-based massive beef production project in the state. The beef production project, called O’Beef, has already commenced in the state with leading foreign experts in beef produc-tion training interested farmers on how to produce beef in a project aimed at ensuring high income from the venture.

To realize the objectives of the mas-sive food production, the administra-tion had set up the Osun Rural Enter-prises Agricultural Programme and the QUIIP as part of the vehicles to drive the projects. The two agencies had supervised agriculture land clearing, distribution of improved seedlings, fertilizers, and loans to farmers to aid their planting activities. As part of ef-forts to make agriculture attractive as well, the government has assured farmers of its readiness to transport their farm produce free of charge to large markets in Lagos through its memorandum of understanding with the Nigeria Railway Cooperation.

OSUN OPENS BILATERAL TALKS WITH OSUN OPENS BILATERAL TALKS WITH OSUN OPENS BILATERAL TALKS WITH OSUN OPENS BILATERAL TALKS WITH GERMANY ON FOOD PRODUCTIONGERMANY ON FOOD PRODUCTIONGERMANY ON FOOD PRODUCTIONGERMANY ON FOOD PRODUCTION

G overnor Rauf Aregbesola of Osun State has opened discussions

with the German state of Saxony An-halt as part of the state’s determina-tion to further boost its comprehen-sive agricultural programme. Aregbe-sola, who led a delegation of top gov-ernment officials saddled with the food production project of his admini-stration to the talks in Germany, has expulsion of hunger as one of the six integral plans of his administration. The governor reassured the people of the state of his administration’s deter-

NIGERIA’S INFLATION ON THE RISENIGERIA’S INFLATION ON THE RISENIGERIA’S INFLATION ON THE RISENIGERIA’S INFLATION ON THE RISE

Nigeria's headline inflation rate rose to 12.9 percent in Q2, 2012 from 12.10 percent in Q1, 2012 based on the report from Monetary Policy Com-mittee for the second quarter ended June 30, 2012. According to the Com-mittee, the moderate increase was partly attributed to the persistent in-crease in the prices of some farm produce such as yam tubers as well as the increase in the electricity tariff. Other notable increases were ob-served in the cost of some other rec-reation and sporting, catering and miscellaneous services. It was equally noted that the core inflation for June stood at 15.2 percent, 30 bps higher than the 14.90 percent recorded in the previous month.

OYO TO INVEST N6BN ON THE CON-OYO TO INVEST N6BN ON THE CON-OYO TO INVEST N6BN ON THE CON-OYO TO INVEST N6BN ON THE CON-STRUCTION OF 5STRUCTION OF 5STRUCTION OF 5STRUCTION OF 5----STAR HOTELSTAR HOTELSTAR HOTELSTAR HOTEL

T he Oyo State Government is to construct a 150-room five-star

hotel in the heart of Ibadan, the state capital at the cost of N6 billion. The hotel which will be built on a Public Private Partnership (PPP) arrange-ment will see the state government inject about 10 per cent of the total project cost, in addition to value of the site. Abiola Ajimobi, Oyo State governor, while turning the sod of the hotel situ-ated few meters away from the popu-lar Premier Hotel and Cultural Centre,

DOMESTIC ECONOMIC UPDATE Page 3

Meanwhile, the Committee also ob-served that the current core inflation index is the highest recorded since March 2009. This figure raises signifi-cant concerns as the index exclude “farm produce” which is more volatile.

BUDGET 2013: FG TO SET UP SINK-BUDGET 2013: FG TO SET UP SINK-BUDGET 2013: FG TO SET UP SINK-BUDGET 2013: FG TO SET UP SINK-ING FUND ON DOMESTIC DEBT ING FUND ON DOMESTIC DEBT ING FUND ON DOMESTIC DEBT ING FUND ON DOMESTIC DEBT ---- OKONJOOKONJOOKONJOOKONJO----IWEALAIWEALAIWEALAIWEALA

T he Federal Government will set up a sinking fund to retire some of the nation’s N5.3 tril-

lion domestic debt stock from 2013 fiscal year, with the aim of gradually reducing the huge domestic debt bur-den. Meanwhile, the total wage bill of the Federal Government has risen to N1.6 trillion due to the implementa-tion of the new minimum wage, while 39 per cent of capital expenditure for fiscal 2012 has so far been imple-mented. Minister for Finance and Co-ordinating Minister for the Economy, Dr. Ngozi Okonjo-Iweala, disclosed this at a consultative forum on Budget 2013 for private sector opera-tors and civil society organizations in Lagos.

establishment of the hotel had be-come necessary because of the gap

that exists in quality hotels in the state. He said that those who had been wondering why the influential Fi-nancial Times newspa-per of London chose the state as one of the 10 emerging develop-ment and investment corridors in Africa

would now see that the several meet-ings he had held with development partners were now yielding fruits.

Mokola, said that it was a key prong of his administration’s restoration and developmental initia-tives.

He said that the hotel would provide an inter-national conference cen-tre and banquet facility for projected 400–750 guests, adding that all its facilities would be of international standard and with a touch of class that his administration had been known within the last one year. Governor Ajimobi explained that the

INFLATION

10.30

(Q4.11)

12.10 (Q1.12)

12.90

(JUNE.12)

12.70

(JAN.12)

14.70

(APR.12)

15.20

(JUNE.12)

Y-O-Y INFLATIONThe major drivers of headline inflation during the period were food and nonalcoholic beverages and Housing, water, electricity, gas

and other fuels.

CORE INFLATIONThe acceleration in core inflation in the second quarter was traced to increases in the contributions

of processed food and housing, water, electricity/gas and

other fuels.

11.0 (DEC.11)

12.7 (MAY.12)

12.0(JUNE.12)

FOOD INFLATIONWhile YOY Core and Headline inflation increased substantially Food Inflation however trended marginally down to 12%. These

developments occurred, in spite of the successful tightening stance in

monetary policy.

...Continued from page one...Continued from page one...Continued from page one...Continued from page one

CONTRIBUTION OF THE REAL ESTATE CONTRIBUTION OF THE REAL ESTATE CONTRIBUTION OF THE REAL ESTATE CONTRIBUTION OF THE REAL ESTATE SECTOR TO THE NIGERIAN ECONOMY SECTOR TO THE NIGERIAN ECONOMY SECTOR TO THE NIGERIAN ECONOMY SECTOR TO THE NIGERIAN ECONOMY BETWEEN 2010BETWEEN 2010BETWEEN 2010BETWEEN 2010----2011201120112011

B ased on information given by the National Bureau of Statis-tics (NBS) as regards the Real

Estate sector at the fourth quar-ter, 2011, the situation at the high end area is nearing a zero-demand situation given the credit crunch being witnessed in the Nigerian economy in recent times. However, investments from individuals and some corporate entities still trickle into the low end of the sector, and provide support to cur-rent growth trends. The sector recoded a growth decline from 11.22 percent in the fourth quar-ter 2010 to 11.01 percent in corresponding period of 2011. Also, activities in the Nigerian real estate sector declined in the third quarter of 2011 with a growth rate of 11.05 percent against 11.20 percent recorded in the corresponding period of 2010. Its contribution to real GDP however increased from 1.62 percent in the third quarter of 2010 to 1.67 percent, arising from increased volume of activi-ties at the low end. It also declined from 1.67 percent to 1.64 percent in the third to fourth quarter of 2011 re-spectively. CATEGORIES OF REAL ESTATE CATEGORIES OF REAL ESTATE CATEGORIES OF REAL ESTATE CATEGORIES OF REAL ESTATE ROPERTYROPERTYROPERTYROPERTY

T here are five categories of real property, they are: residential,

commercial, industrial, agriculture and special-purpose.

1) Residential Property: 1) Residential Property: 1) Residential Property: 1) Residential Property: The residential type of property is by far the most popular with both new and experi-enced real estate professionals. It in-cludes property that serves as housing or a dwelling, such as single-family homes, duplexes and other multi-

family homes. 2) Commercial Prop-2) Commercial Prop-2) Commercial Prop-2) Commercial Prop-erty: erty: erty: erty: This is any property owned to produce income or a site where busi-ness or commerce takes place. In its broadest definition, it includes apart-ment complexes and

industrial real estate. 3) Industrial Property: 3) Industrial Property: 3) Industrial Property: 3) Industrial Property: Industrial real estate is property used to manufacture a product. This is sometimes confused with commercial property; after all, it has a commercial use. Industrial prop-erty would include factory and ware-houses, power plants or land located

in industrial districts. 4) Agriculture Prop-4) Agriculture Prop-4) Agriculture Prop-4) Agriculture Prop-erty: erty: erty: erty: These include farms, ranches, or-chards and timber-lands. 5) Special Purpose 5) Special Purpose 5) Special Purpose 5) Special Purpose PropertyPropertyPropertyProperty: Churches, cemeteries, schools, government held

land are examples of special purpose property. CHARACTERISTICS OF REAL CHARACTERISTICS OF REAL CHARACTERISTICS OF REAL CHARACTERISTICS OF REAL ESTATE INVESTMENT ESTATE INVESTMENT ESTATE INVESTMENT ESTATE INVESTMENT

I t is important to note that there are certain other

factors that must be consid-ered before property invest-ment is made in a region; factors such as the popula-tion and the socio-economic situation of the inhabitants. LAGOS STATE REAL ESTATE PROFILELAGOS STATE REAL ESTATE PROFILELAGOS STATE REAL ESTATE PROFILELAGOS STATE REAL ESTATE PROFILE

H ousing units are a pressing need at the commercial capital of Nige-

ria. Presently, Lagos State has a stock of 1.25 million housing units with an estimated population of 15 million,

translating to housing deficit of 10 per cent. Today, Lagos requires a total of 2.17 million housing units to close the existing housing deficit/gap.

OYO STATE REAL ESTATE PROFILEOYO STATE REAL ESTATE PROFILEOYO STATE REAL ESTATE PROFILEOYO STATE REAL ESTATE PROFILE Real Estate opportunities that will most likely result in high yield for the Odu’a group, are creation of housing units (which the Odu’a Group has already delved into) as well as commercial property (the group has also started work in this area). OGUN STATE REAL ESTATE PROFILEOGUN STATE REAL ESTATE PROFILEOGUN STATE REAL ESTATE PROFILEOGUN STATE REAL ESTATE PROFILE The increasing population in Ogun state would ensure a good market for residential property. The Ado-Odo/Ota Local Government hosts about 70 per-cent of investment in the state and would easily absorb any commercial real estate that is set up in that area. Also, the incentives and discounts that the state government is willing to pro-vide to investors represent a great in-vestment opportunity. ONDO STATE REAL ESTATE PROFILEONDO STATE REAL ESTATE PROFILEONDO STATE REAL ESTATE PROFILEONDO STATE REAL ESTATE PROFILE The state government is laying empha-sis on agro-based, small and medium scale, labour-intensive enterprises which would require commercial prop-erties. Also, housing has been identi-fied as a key priority in the State’s Me-dium Term Goals for their Vision 2020. Lastly, another opportunity for real es-tate in the state is the proposed con-struction of sea port and free trade zone which will stimulate economic

activity. OSUN OSUN OSUN OSUN STATE STATE STATE STATE REAL ES-REAL ES-REAL ES-REAL ES-TATE PRO-TATE PRO-TATE PRO-TATE PRO-FILEFILEFILEFILE R e c o g -nized as

one of the fastest developing state in the South West, the State government encourages development of commer-cial activities which will in turn will re-quire the provision of commercial prop-erties, especially in the state capital, Oshogbo. The city will serve as the state’s commercial hub. ...Continued on page 5Continued on page 5Continued on page 5Continued on page 5

HIGHLIGHTS ON REAL ESTATE SUB - SECTOR IN NIGERIA

Page 4 VOLUME 1 , ISSUE 12

8.5

9

9.5

10

10.5

11

11.5

Q1-2010

Q2-2010

Q3-2010

Q4-2010

Q1-2011

Q2-2011

Q3-2011

Q4-2011

SECTORALGROWTH(%)

0

0.5

1

1.5

2

Q1-2010

Q2-2010

Q3-2010

Q4-2010

Q1-2011

Q2-2011

Q3-2011

Q4-2011

CONTRIBUTIONTO GDP (%)

VOLUME 1 , ISSUE 12

...Continued from Page 4...Continued from Page 4...Continued from Page 4...Continued from Page 4 The state has placed strong emphasis on the development of tourism activi-ties in the state. This could serve as a good opportunity for the Odu’a group to delve into investment in tourism facili-ties like Hotels and Shopping Malls..

EKITI STATE REAL ESTATE PROFILEEKITI STATE REAL ESTATE PROFILEEKITI STATE REAL ESTATE PROFILEEKITI STATE REAL ESTATE PROFILE It is apparent that the state is in need of commercial properties to sup-port growing busi-nesses and SMEs. This represents a good opportunity for the Odu’a group, as there is expected to be a surge in the rate of commercial and industrial activities in the state. The main cities and towns (and more commercially active regions) of the state include Ado-Ekiti, Ikere, Efon, Ikole Aramoko-Ekiti, Ode, and Oye-Ekiti RECENT DEVELOPMENTS IN THE REAL RECENT DEVELOPMENTS IN THE REAL RECENT DEVELOPMENTS IN THE REAL RECENT DEVELOPMENTS IN THE REAL ESTATE INDUSTRYESTATE INDUSTRYESTATE INDUSTRYESTATE INDUSTRY • Government involvement aimed at

2020 vision of creating a sound mortgage system.

• Increase in Foreign Direct Invest-ment (FDI) resulting from investors’ need to diversify.

• Increased Public Private Partner-ship (PPP) and influx of investors driven by recovery in stock market.

• Increase in housing cooperatives especially oil and gas companies.

• Increase in lease request by com-panies as against owning a prop-erty in prime locations.

• Government priority focused on low income housing.

• Financial institutions focus on real estate providing housing finance.

• Increasing property prices as de-mand far exceeds supply

CHARACTERISTICS OF REAL ESTATE CHARACTERISTICS OF REAL ESTATE CHARACTERISTICS OF REAL ESTATE CHARACTERISTICS OF REAL ESTATE CHARACTERISTICS OF REAL ESTATE CHARACTERISTICS OF REAL ESTATE CHARACTERISTICS OF REAL ESTATE CHARACTERISTICS OF REAL ESTATE INVESTMENTINVESTMENTINVESTMENTINVESTMENTINVESTMENTINVESTMENTINVESTMENTINVESTMENT

1) No fixed maturity - Unlike a bond which has a fixed maturity date, an equity real estate investment does not normally mature. In Europe, it is not uncommon for investors to hold prop-erty for over 100 years. This attribute of real estate allows an owner to buy a

property, exe-cute a business plan, then dis-pose of the property when-ever appropri-ate. An excep-tion to this characteristic is an invest-ment in fixed-term debt; by definition a mortgage

would have a fixed maturity.

2) Tangible - Real estate is, well, real! The owner can visit their invest-ment, speak with their tenants, and show it off to family and friends. It can be seen and touched. A result of this attribute is that there is a certain de-gree of physical control over the invest-ment - if something is wrong with it, it can be fixed. You can't do that with a stock or bond. 3) Lower Liquidity 3) Lower Liquidity 3) Lower Liquidity 3) Lower Liquidity ---- With the exception of real estate securities, no public ex-change exists for the trading of real estate. This makes real estate more difficult to sell because deals must be privately brokered.

HIGHLIGHTS ON REAL ESTATE SUB - SECTOR IN NIGERIA

Page 5

There can be a substantial lag be-tween the time you decide to sell a property and when it actually is sold - usually a couple of months at least. 4) 4) 4) 4) Underlying Tenant Quality Underlying Tenant Quality Underlying Tenant Quality Underlying Tenant Quality ---- When assessing an income-producing prop-erty, an important consideration is the quality of the underlying tenancy. This is important because when you pur-chase the property, you're buying two things: the physical real estate, and the income stream from the tenants. If the tenants are likely to default on their monthly obligation, the risk of the investment is greater. 5) 5) 5) 5) High Transaction Costs - Private market real estate has high purchase costs and sale costs. On purchases, there are real-estate-agent-related commissions, lawyers' fees, engineers' fees and many other costs that can raise the effective purchase price well beyond the price the seller will actually receive. On sales, a substantial broker-age fee is usually required for the prop-erty to be properly exposed to the mar-ket. Because of the high costs of “trading” real estate, longer holding

periods are common and speculative trading is rarer than for stocks. 6) Requires Management 6) Requires Management 6) Requires Management 6) Requires Management ---- Because real estate is tangible, it needs to be managed in a hands-on manner. Ten-ant complaints must be addressed. Landscaping must be handled. And, when the building starts to age, it needs to be renovated. …Continued on page 6…Continued on page 6…Continued on page 6…Continued on page 6

CHALLENGES IN THE REAL ESTATE CHALLENGES IN THE REAL ESTATE CHALLENGES IN THE REAL ESTATE CHALLENGES IN THE REAL ESTATE INDUSTRYINDUSTRYINDUSTRYINDUSTRY

1) land accessibilityland accessibilityland accessibilityland accessibility Ironically, the national land policy, the Land Use Act which was promulgated in 1978 with the intention of making land readily available and accessible to all eligible Nigerians, has ended up constituting itself into a clog in the wheel of housing provision in the country. The land use act was promulgated with the intention of streamlin-ing the land tenure system in the country by vesting the owner-ship and title to all lands in the country on the Governors of respective states of the federation for the purpose of easy management and accessibility by those interested in the acquisition of lands in the country. However, the contentious issue of Gov-ernors consent for any subsequent transaction in the land have made the procurement of land problematic, un-necessarily expensive and outrightly out-of-reach of most Nigerian citizens especially the Urban Centers of the city. 2) Stunted Financial And Mortgage 2) Stunted Financial And Mortgage 2) Stunted Financial And Mortgage 2) Stunted Financial And Mortgage SystemSystemSystemSystem Generally, there is no credit or finance structure available to the low-income groups for land, housing and basic services in Nige-ria. The only win-dow for all Nigeri-ans to access financial facility for land, housing and basic ser-vices is the Na-tional Housing Fund [NHF] es-t a b l is h ed i n 1992. The participants are expected to con-tribute 2.5% of their monthly income with a primary mortgage institution, for

a period not less than six [6] months in order to qualify for a maximum loan of N15 million [US$96,774] at 6% annual interest payable over a period of 25 years. The scheme is operating in all States of the Federation with about 101 Pri-mary Mortgage Institutions [PMIs] as

the primary savings and lending agents. 63 of these PMIs are located in Lagos while the rest 38 are spread across the remaining 35 states of Nigeria. Federal Mortgage Bank of Nigeria is the regula-tor, secondary fund repository and loan approving authority

for the NHF contributors. As at Decem-ber, 2010, record has shown that a total sum of N50.68 billion was ap-proved out of which N23.89 billion representing 47% was disbursed to 16,468 applicants through 57 PMIs. T h e a v e r a g e amount approved is equivalent to N1, 450,692 [US$9, 359] per benefici-ary. Significant numbers of Nigeri-ans who are mainly in the informal sec-tor of the economy were denied partici-pation from this scheme because of

low deposit mobilization, inability to track their monthly income and lack of formal titles to their land holdings. 3) Exorbitant prices of 3) Exorbitant prices of 3) Exorbitant prices of 3) Exorbitant prices of building materials and dis-building materials and dis-building materials and dis-building materials and dis-proportional capacity build-proportional capacity build-proportional capacity build-proportional capacity build-ing in the sectoring in the sectoring in the sectoring in the sector

Since 1986, the prices of building ma-terials have been on the upward trend with significant effect on the poor fami-lies’ home construction. Between 1986 and 1997, marble price in-

creased by 555% while a ton of mild steel reinforcement increased by 35% over the same period. Cement, a basic component of housing con-struction in Nigeria rose from N23.50 per bag in 1986, N420 in 1997, N1, 150 in 2005 to N1, 850 in 2012, an increment of about 7,770% over a period of 26 years. During the same period, the purchasing power of aver-age resident in Lagos have declined with non commensurate income wage and commitment of over 40% of income to housing expenditure against the United Nations recom-mended 20%. REQUIRED INTERVENTION EFFORTSREQUIRED INTERVENTION EFFORTSREQUIRED INTERVENTION EFFORTSREQUIRED INTERVENTION EFFORTS

I t is apparent from the foregoing that the state government is over-

whelmed by the housing quandary and lack the necessary inventiveness to resolve the same. Therefore, the situation requires the intervention of all stakeholders in land, environ-

ment, housing and urban development towards the resolution of the housing crisis. The roles of civil soci-ety in preventing forced evictions, ille-gal demolition of houses, creat ing awareness among the inhabitants of slums on their housing rights, researching

into adaptable and best practice of housing delivery to the low-income groups, facilitating the institutionali-zation of affordable housing policy, and engaging in the development of affordable housing becomes very critical in achieving sustainable hous-ing delivery framework for the teem-ing population of the state, especially the vulnerable groups. Sources: Sources: Sources: Sources: w w w . w i k i p e d i a . c o /realestate, www.estatenigeria.com, www.afrowall.com, www.nigeristat.gov.ng, www Punch, Vanguard, Tribune . BusinessDay and Guardian newspapers

VOLUME 1 , ISSUE 12 Page 6 HIGHLIGHTS ON REAL ESTATE SUB - SECTOR IN NIGERIA

VOLUME 1 , ISSUE 12

ODU’A RECEIVES AWARD ON HIGH ODU’A RECEIVES AWARD ON HIGH ODU’A RECEIVES AWARD ON HIGH ODU’A RECEIVES AWARD ON HIGH OPERATIONAL STANDARD FROM OPERATIONAL STANDARD FROM OPERATIONAL STANDARD FROM OPERATIONAL STANDARD FROM AADFI AADFI AADFI AADFI

T he Association of Africa Develop-ment Finance Institutions

(AADFI) at its 2011 2nd peer review and rat-ing exercise, rated Odu’a In-vestment Com-pany with an A grade in the areas of Good G o v e r n a n c e , Finance and O p e r a t i o n a l Standard. The exercise which was conducted under the aus-pices of the Afri-can Develop-ment Bank, was reviewed using 30 member–institutions including 27 National Development and Finance Institutions (DFIs) and three regional Institutions based on Prudential Standard, Guidelines and Rating Sys-tem (PSGRS).

The AADFI Rating Award was re-ceived by a team of Management

Director/CEO, Mr. Adebayo Jimoh at the 38th Ordinary General Assembly Meeting of the Association held from May 30—31, 2012 at Arusha Palace Hotel, Arusha, United Republic of Tan-zania.

The theme of this year’s Annual Gen-eral Assembly workshop was “ F i n a n c i n g Infrastructural Development: an agenda for DFI’s”. Speak-ers at the workshop in-cluded Geof-frey Qhena, H o n o r a r y Chairman of AADFI and

Chief Executive Officer of Industrial Development Corporation of South Africa (IDC0) who spoke on “Innovative Resources Mobilization for Financing Infrastructure in African Countries”. Present at the workshop were key speakers who spoke on issues relating to infrastructural development and the growth of SME’s in Africa.

UPDATE ON IRE BRICKS FACTORYUPDATE ON IRE BRICKS FACTORYUPDATE ON IRE BRICKS FACTORYUPDATE ON IRE BRICKS FACTORY

T he story of Ire Clay Products Limited that stopped produc-tion 14 years ago is in the

process of change.

Ceratec SA/NV of Belgium, with a reputation of reviving similar outfits in Nigeria and the West African sub-region, has commenced the rehabilita-tion process of the one time moribund bricks factory. An agreement on the rehabilitation exercise had already been signed by the major shareholders; Odu’a Invest-ment Company and Ekiti State Govern-ment and rehabilitation work has com-menced at the three main sections of the factory namely: the preparation, dry and kiln sections, is at various stages of completion. The factory when fully rehabilitated, has the capacity to produce 20million blocks per annum (about 50 tons per annum) and strategic in the area of job creation to unemployed youths.

liter surface and 20,000 liter overhead water storage facilities are installed.

**** A Dedicated 500KVA transformer to ensure quality electrical power supply

in the estate.

****Central Facility M a n a g e m e n t Services to pro-vide prompt and efficient atten-dance to re-pairs / mainte-nance issues, gardening and general upkeep o f c o m m o n amenities

****Ample walk-way/playground. Each tenant has ac-cess into the privately gated estate through a single major double leaf ve-hicular gate and pedestrian foot gate leading into the open centre with direct access to the frontage of each house to the right or left side of the premises.

...Continued from page 1...Continued from page 1...Continued from page 1...Continued from page 1

ODU’A UNVEILS THE NEW ODU’A UNVEILS THE NEW ODU’A UNVEILS THE NEW ODU’A UNVEILS THE NEW ALMOND COURT ALMOND COURT ALMOND COURT ALMOND COURT hitherto contained a 3-bedroom bungalow with boys’ quarter. The estate, which has become the toast of the people, un-derscored the commit-ment of the Board and Management team of Odu’a in keeping alive the vision of the found-ing fathers through its PRP. The property offers each occupant a fantas-tic environment in a low density with first class security and infrastruc-ture. Other modern ser-vices and amenities in the estate court include:

****Two boreholes, one industrial and an alternative in the event that the main one is under servicing or re-pairs. In addition to this, a 30,000

BUSINESS UPDATE AND SUBSIDIARY REPORT

Page 7

From right: Mr. K. Bakaree (Odu’a), Chair-man of AADFI, GMD/CEO of Odua, Mr. Adebayo Jimoh, Mr. S. Omidiji (Odu’a) and the Secretary General of AADFI.

A Monthly bulletin Publication Compiled by Research & Planning Department ofA Monthly bulletin Publication Compiled by Research & Planning Department ofA Monthly bulletin Publication Compiled by Research & Planning Department ofA Monthly bulletin Publication Compiled by Research & Planning Department of

Odu’a Investment Company LimitedOdu’a Investment Company LimitedOdu’a Investment Company LimitedOdu’a Investment Company Limited

Cocoa House Building, Floors 20, 21, 22 & 23 e-mail: odua@oduainvest.com.ng

MACROECONOMIC INDICATORSMACROECONOMIC INDICATORSMACROECONOMIC INDICATORSMACROECONOMIC INDICATORS

SOURCE: NBS, CBN, MPC, BUSINESSDAY

SO

MAR JUN

$USD 157.41 155.16

€EUR 206.47 189.94

POUNDS 247.10 240.82

Monthly Average Exchange