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Stakeholders: Lagos the most expensive place to build in Africa

The Director, Turner & Townsend, Austria, Bruce Haswell has said that Lagos is the most expensive place to build in Africa at $2,056 per m2, comparing to Kampala for less than half of this per square meter.

He stated this in his keynote presentation titled “Key signals in 2022 – Is it a time for some caution or more innovation ” at the 2022 Real Estate Discussions and Awards organized by Thinkmint Nigeria.

Themed: “Recovery” which was held in Lagos, Nigeria was well attended by Comrade Ini Ememobong Essien, The Honourable Commissioner for Information and Strategy who represented His Excellency Governor Udom Emmanuel, The Executive Governor of Akwa-Ibom who was the Special Guest of Honour and hosted the event’s private investors forum. The event supported by Purple Group, Homework Group , Federal Housing Authority Mortgage Bank, UPDC, and Elan Orris Real Estate also had in attendance top players in the industry, representatives of government officials, and real estate investors.

He said that compared Internationally, Lagos is the 56th most expensive city to build in compared to the 88 cities that we surveyed internationally. The results of this year’s survey were markedly different from our 2021 survey results, which highlight the enormous pressures facing construction markets and the impact they are having on construction costs.

Haswell said “In our 2021 survey, there were 11 markets that were expected to have construction cost inflation of ten percent or more in 2021. In our 2022 survey results, there are 38 markets that suggested they experienced inflation of ten percent or more. Rising building material costs have been one of the key drivers of higher construction cost inflation over the last 12 months. Global supply-chain disruptions, high commodity prices, higher shipping costs, and supply shortages have caused this strong price growth”.

He further mentioned that the major reason for the global challenge to construction was as a result of general inflation, increasing interest rates, the rising cost of construction, excessive lead times, geopolitical issues, transportation bottlenecks, and recent COVID-19-related shutdowns in China having a considerable impact on supply, and creating lengthy delays for many construction goods.

“Skilled labour shortages, a sharp rebound in construction activity, coupled with the delayed resumption of labour migration are limiting the availability of labour to complete the growing pipeline of work.”, he said

Haswell further said, ” rather than boosting domestic value added, trade restrictions were hurting Nigerians while PropTech , high tech manufacturing and ESG were innovative ways to demystify the key signals of the high construction cost in Nigeria”.

In his day two keynote presentation, Ayo Teriba spoke extensively on the key assets to amass as a source of wealth assets. They are the “Real estate being the oldest and largest (69%) booster of the world’s assets , human capital and digital capital. The Ceo of Economic Associates emphasised that real estate remained the queen of all sectors , with slum eradication, rural urbanisation and urban renewal being the three slogan trending in the space.

“Much work needs to be done as only 24% of the 200 million populace in Nigeria live in habitable urban homes , while most people in search for greener pastures move to urban slums” he further commented.

Also speaking at the event, The Managing Partner of Thinkmint Nigeria, Imelda Usoro-Olaoye, said that the programme is a celebration of Innovation, Leadership, and Growth in the Real Estate and Property Industry.

“The award is set to honour real estate game changers, companies, products, and personalities that have made contributions to the development of the sector”, she said.

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