We’ll Greatly Reduce Housing, Commercial Space Deficit, Says Mohammad
The Managing Director of Earthpoint Development Services Limited, says their target is to greatly reduce the nation’s housing and commercial space deficit. They also plan to ensure that their buildings are eco-friendly with EDEGE (Excellence in Designs for Greater Efficiencies) certification
Tell us about your real estate development company
My name is Hilaluddeen Muhammad I’m the Managing Director of Earthpoint Development Services Limited, a construction company that started business in 2015, I’m an engineer. I manage the company and I have been doing so for five years. Basically that’s my background I’m from Kano State I studied at Bayero University Kano then did my masters in Ahmadu Bello University and I’m also a member of the Institute of Directors currently I’m the Assistant Secretary of the Institute of Directors
How did you get into real estate?
I started around 2014/15. We had friends/contacts that trusted us to get them properties in Abuja and other parts of the country. So, at a point, we had so much demands and delivery started to become an issue, you know when people trust you with money to get properties and maybe they are in diaspora, maybe they are not around and they trust you, and then you took money on their behalf to develop houses for people and then there is no date for them to get what they paid for. So, my friends and I decided, four of us, to maybe open a construction company and start developing the houses since we’ve been doing it as third party people, so that’s what gave birth to Earthpoint Development Services in 2015. So, we started few projects in Jabi, Abuja and right now we can say we have built up to 300 to 400 houses from 2015 till date and we are in the process of building more just to reduce the housing deficit in in the property market.
Tell us more about your projects
Initially we started with little estates, estates that comprised four to five houses. Then we expanded further to estates that have a hundred houses, we have like nine projects in Abuja we have completed like eight of them and the biggest project we have are in Abuja, one is at Life Camp, about 90% completion. We have 130 houses and people have been occupying those houses over the past year and we have another one that is similar which has about 100 houses. So, new projects and last year, we went to Kano to explore the Kano market. Ours are lifestyle to sustainable houses and then to sustainable living. So, we are planning on it having the EDGE (Excellence in Designs for Greater Efficiencies) certification which certifies your house as green houses, eco-friendly houses, so we are working with the International Finance Corporation and World Bank towards getting that certificate. I must say we are the first estate in Abuja to get the preliminary EDGE certificate for our projects at Life Camp so that means the houses are truly eco-friendly and sustainable and then there in Abuja we have a mix-development, which has commercial and residential, we want to go into but because of COVID we saw that people want to live where they work, so we decided to get that concept into housing so we have our commercial space, a shopping space and then the residential spaces, so those are the major projects we are doing and we are also doing some commercial projects in Kano which are building shops for the commercial sector.
What systems do you have in place to assist your prospective buyers
Yes oh, there are several ways of assisting the buyers in the first place there are several mortgage opportunities out there and the mortgage opportunities have become simpler and more flexible these days with commercial banks entering into the real estate mortgage industry and then there is the federal mortgage bank and then for the low income earners there’s the Family Trust Fund which is funds through government or through banks are meant to support the prospective owners and then our platform we spread our payment such that they are flexible payments we want to uh we are currently looking to do the rent to own programme so that you can be in the house and pay it between five and seven years so we are currently with our financial advisors trying to work out a model that would create that scheme so those are some of the support we give to our prospective owners or customers.
With the current economic situation we have in the country, do you think it’s advisable for one to invest in the real estate sector?
Yes, now you know we are in a recovery period right now, we had a recession period and there’s a recovery period and Nigeria is on a path of growth and so this is the right time to invest. Just after a recession, most people find it interesting to invest in real estate because of the recession things usually go down, the purchasing power goes down but then towards the recovery period you see a lot liquidity in the system and then in Nigeria particularly because the stock market and the money market is not flourishing there’s a lot of liquidity and people want to invest money in where they will get returns and I can tell you that so far now real estate is maybe the 2nd or 3rd highest business that will give you very good returns on investment. I think now that’s why you are seeing so many real estate if you go round Abuja you will see that almost all buildings, Abuja Lagos are owned by real estate companies it’s a perfect time to invest so that the returns are actually quite high you will see real estate companies giving 50%, 40% returns on investments I bet you no other industry can give you such amount of huge returns .
What do you think can be done to address or to cushion the housing deficit in the country?
Actually, I think is going to get higher because you know Nigeria is projected to be the third most populous country in 2050, we are just 20 or 30 years away from now and the population keeps increasing that means the housing deficit will have to increase and the Nigerian economy keeps growing so everyday people are employed people need shelter every day. There are so many ways the housing deficit can be reduced and mostly I think it’s in land administration in Nigeria. We need to go back to the days when land is given to people because most part of the cost of construction is land so if you have an expensive land definitely your houses are going to be expensive and there is so much inflation right now with the instability of the Naira the currency so we need find ways to mitigate such kind of inflation so that the houses are affordable and people can own I think there is a lot that government needs to do in terms of making the funding arrangement or mortgage institutions more accessible to the common populaces.
Real estate seems to be an all-comer’s industry. Now we have massive fraud that has been experienced in the industry, how do you think this can be mitigated?
I think it’s already being mitigated by first and foremost there are two sides of the story. First the integrity of developers needs to be affirmed. Developers need to know when someone is suspicious. Or when you collect large sum of money for example you know the source of income is not so open but then on the government side there is so much the government is doing to check this frauds for example there’s a control unit for money laundering and then there’s Nigerian financial intelligence unit who real estate developers whom some industry report to some non-designated, non-financial institution that report such suspicious activities as C.E.M.L so I think that’s a way to mitigate against fraud is for developers to have integrity and for government to keep on checking the developers.
Where do you hope to see Earthpoint in the next five years?
In the next five years, you will see a bigger company, we have entrenched corporate governance in our company, we just appointed a board chairman, and we appointed independent directors. So, you will see a sustainable company in the next five years. We delve into commercial real estate, as well as having our presence felt across Lagos and Kano states and we hope to like you mentioned earlier greatly reduce the housing deficit and not only housing the commercial space deficit that Nigeria is facing because if you notice in Abuja there are so many houses that are being converted, residential houses being converted to commercial plazas or so. So, that means there is actually a deficit of commercial space as well so we want to fill that up both from the residential and commercial point of view.
How do you relax?
I actually love travelling, when I want to relax, I travel and I explore foods of different countries and nationalities so that’s how I relax. At times, I read books even though books are hard to read now because of the busy schedule, but travelling is what I enjoy doing most.
