The Lagos State government has offered restate estate developers in the state fresh guide on how to get building approvals to avoid the pain of demolishing their buildings after construction.

In recent time, a good number of buildings have been demolished by the state government, citing lack of building approvals or contravention of existing physical laws. This has always left sour taste in the mouth of the residents as the victims lose either homes or investment or both.

To avoid all these, the state, in a recent state, documented the various requirements which a builder must meet in order to obtain the relevant authorities approval to continue with a planned construction.

Those many of these requirements are quite relevant and necessary to ensure building stability and safety of buildings, some, according developers are spurious and seem to be there for the purpose of generating revenue to the state government.

In the new disoensation in Lagos, to get approval, the state requires a builder to provide:

Proof of Ownership: This is aimed to show that the the applicant is the rightful owner of the land or property on which the building is planned. Incorporated into this document are Certificate of Occupancy (C of O), a Deed of Assignment, or any other legal documents confirming the ownership rights. The state reasons that having this document prevents property rights conflicts. It assures the government that the building is on legitimately owned land.

Tax Clearance Certificate: a developer is required to provide a Tax Clearance Certificate (TCC) which certifies that all taxes have been paid or are in good standing. It also shows that a person or entity has complied with their tax responsibilities to the government. It is essential to the building process in Lagos where tax is an integral part of governance. Without the certificate, a builder finds it difficult to apply for and get permits and approvals.

Land Use Charge Receipt: In Lagos, land is an equivalent of an oil well. So the state does not joke with the tax it charges land or property owners. So, this receipt is an essential document that indicates if a particular area or land is designated for residential, commercial, or industrial uses. The receipt is required before one can get a building permit and approvals.

Structural Engineer’s Supervision Letter: The aim of this particular item is to prevent the high incidence in the state. The letter is a document that gives property owners peace of mind regarding the safety of the project and reassures regulatory authorities that a qualified professional will oversee the work.

Subsoil Investigation Report: This is also aimed to prevent building collapse by determining the texture of the soil on which a building is to be sited. It is produced by certified geotechnical engineers, and contains data on groundwater levels, soil types, and bearing capacities. The report is needed to direct the foundation design and construction approach by detecting potential concerns such as soil instability and groundwater issues.

Electrical Drawings: Electrical drawings are essential records that offer thorough layouts for a building’s electrical systems. This is meant to ensure safety laws and standards which is why the drawings are expected to contain layouts for wiring, circuit configurations, lighting, and power distribution.

Mechanical Drawings: These drawings are very important in construction projects as tthey detail the mechanical systems of a building, such as heating, ventilation, air conditioning, plumbing, and other mechanical installations. The drawings provide specifications for equipment layout, pipe systems, and airflow designs, ensuring that all mechanical aspects work properly and safely.

Other more traditional or familiar requirements are the Survey and layout plans, and structural drawings, The state explains that a survey plan is necessary for building projects because it guarantees that the dimensions and borders of a plot of land comply to the laws.

The developer is also required to produce Architectural Drawings which is sealed, signed, and stamped by an Architects Registration Council of Nigeria (ARCON)-registered architect. This is expected to provide comprehensive plans and specifications of the proposed structure, including layout, measurements, and architectural elements.

These designs show that the building codes and regulations in Lagos are being followed, which is essential for getting building permits. It also acts as a construction blueprint, steering the project from start to finish and reducing expensive errors.

On its part, the structural drawing gives critical information regarding the dimensions, materials, and construction procedures to be employed, ensuring that the building is safe, stable, and following the state’s building rules. Such a drawing usually comprises specifications for foundations, beams, columns, load-bearing walls, and other components.

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Real Estate Investment Trusts (REITs) function similarly to mutual funds. These publicly traded companies own, manage, or finance income-generating real estate assets, including office buildings, shopping malls, apartments, hotels, and warehouses. By pooling capital from numerous investors, REITs can acquire and manage income-producing properties and mortgage loans.

REITs come in three types: equity REITs, mortgage REITs, and hybrid REITs. Equity REITs focus on acquiring, holding, and managing commercial and rental properties to generate profits.

Mortgage REITs invest in real estate mortgages, using properties as collateral for their loans. Hybrid REITs combine both strategies, investing in both properties and mortgages.

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Currently, Nigeria has only equity REITs. Among them, UPDC REIT led in rental income for the year, earning N1.44 billion.

UPDC REIT – N1.44 Billion

UPDC REIT, established by UPDC in 2013 and managed by Stanbic Asset Management Limited, oversees several prominent properties including:

• Victoria Mall Plazas 1 and 2, Victoria Island
• Pearl Hostel, Pan-Atlantic University, Ibeju Lekki
• UAC Commercial Complex, Abuja
• Kingsway Building, Marina, Lagos
• Abebe Court, Ikoyi Lagos
• Project Stack, Lagos

In 2023, UPDC REIT generated N1.44 billion in rental income, an increase from N1.26 billion in 2022. However, its share price, which appreciated by 115% to N6.40 during the year, later declined by 37.5% to N4.00 as of May 20, 2024.

SFS REIT – N190 Million

Managed by SFS Capital Nigeria Limited, SFS REIT posted a rental income of N190 million in 2023. The trust also recorded a total income of N395.4 million, including N147.7 million in interest income. This represented a 70% growth from the N186.6 million net income in 2022.

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As the smallest REIT in Nigeria, SFS REIT manages properties across Lagos, including:

• Harold Sodipo Crescent, Ikeja GRA
• Victory Park Estate, Lekki
• Bourdillion Court, Lekki
• Milverton, Lekki
• Cromwell Estate, Lekki
• Maben Estate, Chevron Drive, Lagos
• Victoria Crest Estate, Lekki

Notably, SFS REIT generated N54.8 million from its properties in Milverton, Lekki, and N29.7 million from Victory Park Estate, Lekki. Its share price appreciated by 31.6% in 2023, from N77 to N101.35, and remained at N101.35 as of May 20, 2024.

UH REIT – N531.3 Million

Listed on the NGX since 2008, UH REIT recorded a rental income of N531.3 million in 2023. The total market value of UH REIT assets was N10.04 billion at the end of 2023, up from N9.82 billion in 2022. UH REIT receives rent from various properties in Lagos and Abuja, including:

• McDonald Court, Ikoyi
• Locke Apartments, Lekki
• 9, Mike Akhigbe Way, Abuja
• Plot 3, Block A4, Olusegun Aina Street, Ikoyi
• Savannah Court Estate, Victoria Island
• Amina Court, Apo, Abuja
• 28A, Rumen Property

Throughout 2023, UH REIT’s share price remained consistent at N36.60 and closed at the same price on May 20, 2024.

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