(Cover Photo by Ovinuchi Ejiohuo on Unsplash)
Market Size
The Millennium Development Goal of reducing poverty through the ownership of houses expired in 2015, but Nigeria has not shown any sign of achieving 10% of the requirement as she is said to be experiencing 17 million housing deficit (FHA, 2014), mostly for the low and medium income group where the demand is critical. Nigerians have had to contend with promises of House for all by the year 2000, house for all by the year 2010, house for all by the year 2015 and now house for all by the year 2020. All promises end at policy level with no assurance that it is achievable. The federal and some state governments have embarked on housing schemes for their workers but only recently, the Federal Government has admitted that it cannot provide houses for its population, because of workers attitude to government owned properties and high cost of annual maintenance, and instead, as observed by Atonke (2014), sold out all the houses previously constructed for public servants to members as owner occupiers and monetized housing provision to housing allowance to workers while still deducting 2.5% of salaries for housing.
In Nigeria, housing deficit as at 2007 stood at between 12 million to 14 million units. The study, on Middle-Income Housing in Nigeria: Determining Important Functional Requirements for Mass Housing Design, conducted by Chinwe Okpoechi, further affirmed that by 2008, it had risen to 18 million units. With an annual population growth rate of 3.2%, according to the National Bureau of Statistics, and rapid urbanization, the housing deficit is expected to remain on the high. This is further compounded by the challenges faced by government and its private sector partners in providing adequate housing, which include inadequate knowledge of the nature and scope of the country’s housing problems, and a narrow concept of the housing need. Studies by several authors
have shown that in spite of optimistic housing policies by the government since the 1960s, results have remained largely unimpressive, at slow rate, as housing provision has remained far short of policy projections.
Ibem and Amole in their article Evaluation of public housing programmes in Nigeria: A theoretical and conceptual approach opined that mass housing describes housing provided on a large scale and in multiple units wholly by government or in collaboration with the private sector for purposes of public acquisition either on owner-occupier or rental basis. The purpose of mass housing is to provide decent housing at reasonably reduced costs, to households unable to afford the heavy investment of acquiring land and building houses at prevailing market rates.
The low and the medium income group who constitute the bulk of the population in the country are the worst hit as policies of successive governments in the country has not improved the lot of those in these income groups. In most urban centers, the problem of housing is exacerbated due to the incidence of massive rural-urban drift, which has been occasioned by the total neglect of the rural areas in terms of infrastructural development, the poor economic conditions of the rural inhabitants among others.
Mabogunje (2007) affirmed that Nigeria need 15 million houses to overcome her housing deficit and to finance this, over N12 trillion will be required which is approximately four times the annual national budget of Nigeria. Amao and Ilesanmi (2013) asserted that recent study of housing situation in Nigeria put the existing housing stock at 23 per 1000 inhabitant. However, the Federal Mortgage Bank of Nigeria in 2015 put the national housing need that can combat the current national housing deficit at 17 to 20 million houses.
Kumo (2015), opined that Nigeria need 17 to 20 million housing units to address the current housing deficit in the country while Olotuah and Taiwo, concluded that, housing need in Nigeria
increases by the day, whereas the vast majority of the population lacks the wherewithal to make effective demand on housing.
The major players in the Nigeria housing industry sector are the private and public subsectors, with the private housing subsector producing more than 85% of the total housing stock in the country. The public housing subsector has performed below average in this area due to government policy summersault and the over bearing role of politics in public housing delivery, unrealistic and uncoordinated housing programme projections, inadequate knowledge of the nature, scope and dimension of the general housing problems of the country.
The Center for Urban Pedagogy (2009) in Aden (2015) asserted that affordable housing to government mean affordable for families in the middle or at the lower end of the income scale. The Center also defined affordable rent burden to mean the maximum income a family is expected to spend on housing not exceeding 30% of the family’s total income. That is a housing which families in certain income categories can occupy with 30% or less of their annual income. Most families in Nigeria spend over 50% of their annual family income on rent as property cost depend on property availability, infrastructural services and location. Hence the threshold of 30% fixed by a particular government that works in the country may not be realistic in some other country.
Low-income group as defined by the Nigerian National Housing Policy (FGN, 2004) include all employees and self-employed persons whose annual income is N100, 000:00 and below (i.e. the equivalent of salary grade level of 01-06 within the civil service). According to the Human Development Index HDR (2008) in Alagbe (2013) Nigeria currently ranks 158 out of 177 Economies and 70.8% and 92.4% of Nigerians live below income poverty line earning less than $1 and $2 dollar a day respectively. It is also estimated that the majority of the citizens who need housing in this country are within this category of income earners.
Growth Rate
Proposed Actualization Framework
This framework was set up to track the progress of the government towards providing housing for its citizens. The policy targets 500 houses by each LGA per annum across the country, 3000 houses by each state government and 25000 houses by federal government per annum was proposed, granted that if sustained for ten years will produce a significant reduction in the housing deficit and provide a better environment for the economy. According to Osubo, a major problem that often hampers implementation of government projects is lack of budgetary allocation and funding. It is in the light of this that it is heartwarming to hear that the federal government under President Muhammadu Buhari claim to have saved N2.20 trillion in six months from the introduction of Treasury Single Account (Omoh, 2016), and is currently saving N647.2million from suspension of subsidy on Premium Motor Spirit (PMS) (Eboh, 2016).
A Strategy of providing 500 of two and three bedroom houses each year in each of the 774 local government areas will achieve (500 x 778 = 389,000), each of the 36 States to produce 3000 houses each year (30 x 36 = 108,000) and the Federal government 25,000 houses in a minimum of 30 of the 36 states (30 x 25,000 = 750,000).
The Director General of Federal Housing Authority (www.nigeriapropertycentre.com.news) disclosed (Okereke, 2016) that the agency in 2016 earmark to construct 25, 000 housing units in Abuja in 2016 targeted at the low and medium income earners. The project is to consist of one, two, three and four bedroom apartments in high rise structures to be executed through direct labour and Public-Private Partnerships having acquired parcels of land in 17 out of 36 states.
Over the years such promises have not been matched with adequate budgetary allocations coupled with verylittle fractional implementation of budget in most cases.
Hence, workers who are already too familiar with such promises and statements in the past may not believe until such promises are translated to actions. In the recent past, Public Private Partnership was embraced and employed in a number of low income housing schemes across the country (Adeogun et. al. (2011). It is however observed that houses built by Federal Housing Authority (FHA) are beyond the reach of the average worker. Available prices of FHA houses obtained from their portal indicate that 2 Bedroom flat can go for as much as N9.0m to N23.0m. The prices are beyond the reach of the average low/medium income earners. Lots of completed houses in Abuja which were built by FHA and private developers remain unoccupied because their asking prices are beyond the reach of the average public servant.
The history of government intervention in housing for its citizens dates back to pre-independence. The Nigerian Building Society (NBS) which was model after the British Building society was the first establishment in Nigeria in 1956 to provide mortgage loans to Nigerian and by extension creating avenue for public housing ownership opportunities to more Nigerians in the private sector. The impact of the NBS was felt only by those around Lagos area while very few powerful people outside Lagos area benefited. This and it reliance on government for fund was a serious setback for the programme as the other parts of the country was cut off.
Nigeria government after her independence in 1960, continue with the struggle to house all her citizen thus adopted a five-year development plans. During this time, it introduced The First National Development Plan (1962-1968). The government’s effort at housing provision was focused, principally, on Lagos. However, out of the 61,000 units that were to be built during the period, only 500 units (less than 1%) were actually built by the federal government. Moreover, the
bulk of the housing units were meant for Senior Civil Servants while the housing situation of the poor majority was left unattended to.
In 1971 precisely, the issue of housing was taken to a more serious dimension both at the national and state levels and this resulted in the formation of National Council on Housing. The Federal Government in 1972 set a target of constructing 59,000 housing units in Lagos alone and 4,000 housing units in each of the eleven state capitals.
It was in the Third National Development Plan that government accepted housing as its social responsibility. In the 1975-1980 development plan government pledged to provide housing for “all income groups especially low income groups” and to “ensure that the average urban workers do not pay more than 20% of monthly income as rent”.
The thrust of government’s effort was direct construction of housing units at Federal and State levels, increased construction of quarters for public officials and expanded credit facilities to enhance private housing construction. Also, the 1975-1980 period witnessed two significant events that have profound effects on the state of the housing sector in Nigeria. In 1976, the Nigerian Building Society was transformed to the Federal Mortgage Bank while the land use act was enacted in 1978 (Omange and Udegbe, 2000). Relatively, the Third National Development Plan made some progress in the provision of housing. It is however, worthy of note that the actual housing provision of 28,000 units represents only 14% of the target set, 202,000 units, (FGN, 2004) or about 3% of the actual housing shortage of 867,000 by 1975 (Benjamin, 2000). Despite all of the policies and efforts of the government during the 1975-1980 development plan period, the actual provision of low-cost housing for the teeming urban poor was indeed lacking.
Furthermore, in 1973, the Federal Housing Authority was established, charged with the responsibility of coordinating a nationwide housing programme. Much could not be achieved under the aforementioned progammes. The Shagari regime of 1980 witnessed a major breakthrough in home ownership scheme in the country. The regime encouraged and propagated the concept of affordability and direct citizen participation in the provision of housing through the budgeting of about N 2.6 billion for the implementation of various housing scheme in Nigeria. It also proposed 202,000 housing units with 50,000 of the housing units meant for Lagos and the remaining 19 states are to have 8,000 units each. However, only about 14% of the proposed 202,000 units were achieved, that is about 28280 housing units.
Omole, in his article, Basic Issues in Housing Development, asserted that the era considered the need to house the income earners through the provision of low income residential accommodation; hence out of the 40,000 housing units to be built annually nationwide, 80% of the 2,000 units earmarked for each of the state capital was expected to be for the low income groups. This programme was frustrated in most states especially in those states that were not governed by the ruling party at the national level. The Fourth National Development Plan coincided with the second civilian government headed by Alhaji Shehu Shagari. It witnessed a housing provision drive based on the concept of affordability and citizenship participation. During this period, the government embarked on an ambitious programme and in the first phase, planned the construction of 160,000 housing units nationwide between 1979 and 1983. It proposed the construction of 2,000 houses for each of the then 19 States and Abuja annually, out of which 80% was earmarked for the low-income earners. Unfortunately, it was hardly successful and by 1983, only about 20% of the set target was achieved (FGN, 2004). Moreover, the buildings, which were tagged low-cost houses, ended up being too costly for the target group, the low-income earners and were in most cases sited in locations distant from workplaces, which made them unattractive to the workers (Olotuah, 2000).
The houses provided were purchased by the rich, who in many instances, let out the houses to the low-income group at exorbitant prices. The second phase of the housing programme (with a target of 20,000 dwellings to be built all over Nigeria) was initiated mid-way through the first phase; it never took off in several states mainly because of undue politicization and the uncooperative attitude of the state executives (Olotuah, 2000).
The military administration of Ibrahim Babangida launched the National Housing Policy in 1991, aimed at providing affordable and decent accommodation for all in year 2000. Also the National Housing Fund 36 Affordable and Acceptable Mass Housing Delivery: A Panacea to the Nigeria ... scheme mandatory for all workers earning N3000 and above in both public and private sector where it is expected they contribute 2.5% of their salary to, was established. Government proposed the construction of 121,000 housing units throughout the federation which is in line with the Housing for
All in the year 2000 programme.
The inability of earlier policies and programmes to adequately resolve the backlog of housing problems in the country reveals the need for more pragmatic solutions and this form the basis for a review of the 1991 National Housing Policy. Given the importance of housing in the national economy, the federal government of Nigeria set up a 15-man committee on urban development and housing in 2001. One of the responsibilities of the committee was to articulate a new housing policy.
The report of the committee as accepted by the federal government was published in government white paper on the report of the presidential committee on urban development and housing in the year 2002. Part one of the report contain the new housing policy, which was subsequently published as draft national housing policy in January, 2004.
The draft policy was subjected to critical comments and inputs across the different states of the federation and the New National Housing Policy published in the year 2006. This policy came up with some transitionary strategies in which government made significant effort in partial disengagement into housing provision and encourage privately developed housing (Mabogunje, 2003). Under the policy adjustment such as the amortization period which was 25 years under the previous policy was jacked up to 30 years.
The poor performance of the National Housing Policy in meeting its set goals and objectives led to a comprehensive review, which culminated in the Housing and Urban Development Policy of 2002. The new National Housing Policy was proposed in 2002, and its first draft, came into publication in January 2004. The major thrust of the Housing and Urban Development Policy is to meet the quantitative housing needs of Nigerians through mortgage finance. This involves the restructuring, strengthening and recapitalization of the following institutions (Ebie, 2004):
(i) Federal Mortgage Bank of Nigeria (FMBN);
(ii) Federal Mortgage Finance Limited (FMFL);
(iii) Federal Housing Authority (FHA); and
(iv) Urban Development Bank of Nigeria (UDBN)
The National Housing Fund was transformed into a Trust Fund, with a Board of Trustees, and the FMBN as the fund manager under the direction of the trustees. The Fund is to be known as the National Housing Trust Fund, which can now be used for estate development by the private sector and housing corporations. The housing reforms also involved the establishment of the Federal Ministry of Housing and Urban Development which was empowered to mobilize contributions and enforce collection into the Fund.
Ebie in the article: Statutory Component(s) on Housing Policy asserted that to provide affordable and decent housing, a Presidential Technical Committee on Housing and Urban Development was set up by government to address the new housing reforms. It recommended amongst other things the restructuring of the Federal Mortgage Bank of Nigeria (FMBN) and the creation of Real Estate Developers Association of Nigeria (REDAN), and Building Materials Producers Association of Nigeria (BUMPAN). The new housing reforms created financial mechanisms and institutions that will make available to the private sector (developers) funds for the production of mass houses, and allow purchasers (mortgagors) to have easy access to borrowed money through the Primary Mortgage Institutions. Ibimilua and Ibitoye (2015), considered the post military era as the period that has been able to witness tremendous improvement in the Nigerian housing situation.
Other constraints to housing development and delivery in Nigeria are poverty, high cost of building materials, inadequate financial instruments for mobilization of funds, short maturity preference of lending institution, high rate of rural-urban migration, as well as high rate of poverty. The National Housing Fund (NHF) which is supposed to be low income group friendly turn out to be one that is anti-low income group as its eligibility tend to technically excludes the low-income group through it provisions such as the presentation of evidence of possession of valid title to land (Certificate of Occupancy) and building approved plans, the granting of loan facility on the basis of the contributor’s ability to pay off with 30% of his/her average monthly income and repayment plan of a maximum of 30 years tenor (e.g. a contributor pays back 1/3 Basic monthly income for a loan of N5m at 6% interest rate per annum for a tenor of 30 years being the elastic limit), applicant must have not less than a period of 21 years left in service (if employed), all of these pre-conditions are hindrances towards the realization of home ownership by the low-income group.
However, one of the strategies employed by the Federal Government of Nigeria to curb the housing issues in the country in recent time was the Affordable Home Ownership (AHOS) Scheme of 2014. The Federal Government launched in 2014 the scheme to provide homes at minimum price of N4.5 million per house payable in full after 15 years’ maximum. Furthermore, in same year, the Federal Government proposed the construction of 18,500 housing units throughout the federation, with at least 500 units in each of the states of the federation and the Federal Capital Territory. The programme took off in April 2005 in Ekiti State. The Federal Government (1999 – 2007) involved the establishment of the Federal Ministry of Housing and Urban Development.
In 2017, the then Minister of Power, Works and Housing, Babatunde Fashola, said that the Federal Government had commenced construction of houses in 33 states for workers under its National Housing Programme. Under the housing programme, the minister noted that 653 contractors were engaged in the pilot scheme to deliver 2,736 units, while a total of 54,680 people were employed in the process.
Proposed framework for actualization policy by 2025
Source: Researcher’s Opinion. (2016)
The table above shows a projected delivery of 1,697,000 units each year for ten years (2015 - 2025), at an average target cost of N3, 000,000 each will amount to N5.085 trillion and in a space of ten years will amount to about 17 million loan to be repaid. This certainly will be a significant reduction in the huge housing deficit. For an average low/medium income earner, ability to pay back N3, 000,000 loans at 6% interest within 20 - 25 years is feasible and realistic.
The government’s quest to provide affordable housing to its citizen might have stemmed from the UN statistics. According to the United Nation HABITAT Report (2007), people are living in a world where the majority of people live in cities and one million live in slums, a figure that is projected to double by 2030, and Nigeria is said to be one of the affected countries. Though Akeju, (2007) has observed that there are challenges to harnessing the huge potentials inherent in Nigeria’s housing sector, and invariably providing affordable housing in Nigeria, the challenges he noted ranges from Legislation, Registering Property, Risk Sharing, Absence of a National Credit Database, Stable Macroeconomic Environment, Knowledge Gap, Dealing with Licenses, Taxes, Enforcing Contracts, High Cost of Building Materials to Infrastructural inadequacies. Despite these challenges, it is believed that investment in affordable housing in Nigeria can succeed if the investor(s) put the following factors into consideration:
Government Programs and Regulations
The Department of Mass Housing was established to be responsible for and effectively co-ordinate the execution of the Mass Housing scheme in accordance with the Abuja Master Plan. The Department is also aimed at achieving the following:
To Streamline the opportunities in the sub-sector for better results and to the benefit of the residents.
To Streamline the uncoordinated Private and Public Sector operators involved in Mass Housing Projects in the FCT.
To effectively Co-ordinate and Re-direct the Mass Housing Programmes.
To Promote the organized Private Sector as the pivot on which the scheme is driven in line with the vision of the Federal Government.
The Roles and Functions of the Department include:
Developing the FCT Housing Policies and Regulations in line with the existing National and FCT Laws, Regulations and Policies. This is aimed at facilitating the regulation of affordable Mass Housing Developments by Public and Private Investors.
Prepare Manuals for the provision of affordable Housing and basic infrastructure in accordance with FCT Regulations and National Building Codes for sustainable human settlement. These Manuals will specify standards for the planning, design and development of Housing in accordance with the FCT Regulations and the National Building Code.
Establish criteria, systems and procedure for the development of new housing schemes within the framework of a new policy by the organized Private Sector.
Establish a methodology for engaging stakeholders (in the areas of communication and consultation).
Establish benchmarks and checklists for all developers to satisfy, prior to the commencement of any mass housing development discussions. This will include an assurance of the developer's managerial, technical and financial abilities.
Trends
The Nigerian government has demonstrated its concern for the state of housing in the country in various ways, although, with a limited degree of success, Vivian et al. (2012). In their article: An Assessment of Government Intervention in Urban Housing Development in Nigeria, Vivian et al opined that there have been several instances of government’s direct involvement in housing provision, which reflects in the provision of staff quarters and in the construction of many housing estates in the country since the pre-independence era till the present. Government has also set-up mortgage finance organizations such as the Federal Mortgage Bank and has licensed Primary Mortgage Institutions to mobilize savings and supply funds for housing development. It has formulated the National Housing Policy and has established the National Housing Fund Scheme for workers to contribute savings towards housing development.
Recognizing that housing conditions for a growing number of people were becoming increasingly unacceptable since population growth and urbanization which are major determinant of housing demand pressure are irreversible, the federal government in 1977 promulgated a Decree No. 7 to establish the Federal Mortgage Bank of Nigeria (FMBN) to serve as the apex mortgage institution in the country. The FMBN legal framework was however not sufficient to affect its apex role. This and other related issues prompted the Federal government in 1989 to promulgate decree No. 59
statutorily providing for the establishment of Primary Mortgage institution (PMIs) in Nigeria for which all state housing corporation will assist and perform almost the same functions with the FMBN.
With the presumed commitment as well as huge resources already expended on providing adequate housing by successive governments, there appears to be an impressive showing in terms of increase in tempo of activity in the real estate business of housing sector if the increase in value added of the real estate business calculated both at current producers’ prices (N6,052.51 million in 1994 to N134,899.57 million in 2007) and at per capita (N68.01 in 1994 to N5,511.25 in 2007) is anything to go by.
In addition, the gap between the average annual demand of over N200 million for loans made on FMBN and the average resources available to the bank which is between N40-N50 million (CBN, 2008) over the past ten years have necessitated the following research questions:
What is the true situation in the housing sector of the economy given the conflicting evidences of increased tempo of activity in the real estate business and excess demand for mortgage related loans and advances?
How effective is mortgage financing in stimulating business activity in the housing sector of the economy vis-à-vis achieving the overall public objective of mass housing? Provide accessible and affordable housing?
National Housing Fund (NHF) is a Federal Government introduced scheme that mobilizes long- term funds from Nigerian workers, banks, insurance companies and the Federal Government to advance loans at soft interest rates to its contributors. As stated earlier, the scheme was established by Act 3 of 1992 to enable Nigerians in all sectors of the economy, particularly those within the low and medium income levels who cannot afford commercial housing loans to own houses by contributing 2.5% of their monthly salary to Federal Mortgage Bank of Nigeria, managers of the fund.
Recently, the Federal Government has repeatedly expressed concern about Nigeria’s 17 million housing deficit as President Goodluck Jonathan, during his administration, pledged to redress the trend through equitable access to land Chijioke (2013). According to Chijioke (2013), the then Minister of Lands, Housing and Urban Development, Ms. Amal Pepple reiterated government’s commitment to providing affordable houses to the citizens when they appeared on press Ministerial Platform.
In her presentation, Ms Pepple said that the ministry was collaborating with relevant stakeholders to address the contentious issues in land administration and management adding that the ministry was working in partnership with the Presidential Technical Committee on Land Reform and other stakeholders to address the plethora of issues in land administration and management. Pepple said that 2,667 Certificates of Occupancy (C of Os) had been granted and 1,651 consents for the transfer of land titles granted; while 3,787 serviced plots had been created.
On housing delivery, the minister said that 16, 447 housing units had been added to the national stock since 2011 through the Federal Mortgage Bank of Nigeria (FMBN) and the Federal Housing Authority (FHA). She said that 238 housing units were delivered under the Prototype Housing Scheme and 2,009 housing units were delivered under the Public-Private Partnership/Contractor Finance; while 1,756 housing units were delivered through the FHA. Others are 4,934 housing units delivered through mortgages created by the FMBN, and 7,510 housing units delivered through estate development loans provided by the FMBN. She listed some of the places where these projects are located as Ijora and Ikoyi in Lagos State; Kuje, Gwarimpa and Apo in the FCT; Asaba, Odukpani in Cross River; Gorin Gora in Kaduna State; Gombe and Owerri, among others.
Furthermore, Pepple said that the ministry was establishing 150 fully serviced residential plots per site, spread across 12 states in the country’s six geo-political zones and the FCT.
On manpower development, she said that 140 artisans were trained in the vocational training centre of the ministry, while the School of Architectural and Building Technicians would be established in Kuje. According to Pepple, efforts were being made to establish six more skills acquisition /vocational centres across the country with the support of the Subsidy, Reinvestment and Empowerment Programme (SUREP). Besides, the minister said that urban development programmes were being pursued with vigour, with a special focus on slums’ upgrading and the articulation of National Physical Development Plan, among others.
Achieving affordable housing delivery will raise home ownership to about 50% and will improve Nigeria’s Human Development Index (HDI) ranking, in addition to reducing by poverty in households, through increase the productivity of Nigerians, and make the housing sector contribute over 20% to Nigeria’s G.D.P.
Government, had at various times, made provision for staff housing loans for government employees Chijioke (2013). It had also delved into sites-and-service schemes. However, government intervention in housing has not significantly improved the housing situation of the urban poor in Nigeria. This can be reversed through concerted efforts at ensuring sustainability of the programmes on ground, and new initiatives yet unexplored. The lack of consistency and continuity of policies is often the bane of the execution of government programmes. Sustainability in housing provision can only be achieved if government policies are based on the real needs of the people and not informed by selfish political reasons. As such, housing programmes should be vehicles for improved living conditions of people, with serious implications on their health, welfare and productivity. Meeting set targets should be a priority concern of government at every point in time irrespective of the political leaning of the initiator of the policy. The quantitative housing needs of the urban poor have to be realistically estimated, and their multi-dimensional nature taken into consideration. This is an important component of strategies for policy formulation and decision-making. It forms a basis for setting targets for housing development programmes.
Organizations/Trade Unions Working in the Construction Industry
The significance of trade unions in the construction industry, despite the fact of giving assistance to their participants, have additionally been placed in their responsibilities in discussing some inherent differences in the construction industry, Benjamin et al (2018).
Ebbinghaus and Visser (2000) pronounced that construction trade unions have improved from “social mutual support associations, mere negotiating mediators or just supplicants” and are now fully involved in a common measure whereby the employed members in the construction industry has upheld mass equality. This study contributes to the knowledge of understanding in various factors affecting construction trade union.
Nigerian construction industry consists of trade union that is working collectively to improve the industry. Nigerian construction trade Union effort encompasses a diversity of members that protect the exact workers’ welfare. They involve in hostility for the wellbeing of union members, precisely for good earnings as well as improved circumstances of service, where consultations fail to accomplish the wanted outcome, trade unions are well-known for optional to essential accomplishment which are work to rule, protests and street complaints (Anyim et al, 2013) .
Furthermore, the Nigeria Union of Construction and Civil Engineering Workers (NUCCEW) came into being via the Federal Government Trade Union Decree No. 22 of 1978 establishing industrial
Unions in Nigeria on August 24, 1978 (www.new.nucecfww.com/our-profile/). The Union emerged from twenty-five (25) different house Unions which hitherto existed in the industry before the merger, which came as a result of the Federal Government of Nigeria’s efforts to restructure unions along industrial lines.
The merging house unions and structures as gazetted in the Federal Republic of Nigeria Official Gazette No.6 OF 8TH February 1978 volume 65 page 159 no. 40. Presently, the union has an average of 86,997 memberships.
It was foreseen that construction industry is labour intensive and will require enormous organizational effort hence the department of organization and expansion was tailored to reflect the then nineteen (19) State structure of the political map of Nigeria. As at today NUCECFWW has Twenty three (24) State council structure with functional offices and officers to man them.
The Union was organized effectively when the 41 industrial Unions were again merged through the effort of the Nigeria Labour Congress who set up a committee for that purpose before the Ministry of
Labour and productivity took over the merger process in 1996.
Some of the long-existing construction companies that are operating in Nigeria, and have embarked on numerous projects include the following:
1) JULIUS BERGER NIGERIA PLC
Julius Berger Nigeria rose to prominence after completing the Lagos Eko bridge in Lagos. The firm is one of the most identifiable construction companies in Nigeria with considerable wealth of experience in civil, marine and industrial construction.
Its major projects in Nigeria includes: National Assembly phase 3, the Nnamdi Azikwe International Airport phase 1, Ajaokuta steel company, Tin Can Island Port Lagos and the 3rd mainland bridge also in Lagos among other major constructions around the country. It is the main contractor for upgrading of top Nigeria’s Abuja Airport Runway.
2) REYNOLDS CONSTRUCTION COMPANY
Reynolds Construction Company (Nigeria) Limited is a subsidiary of SBI International Holdings AG (SBI), whose headquarters is in Switzerland. SBI is a transnational construction and development group, with subsidiaries in several countries of the world. SBI’s first foray into Nigeria was in 1956 when it established a construction company called Nigersol Construction Company Limited. The company has several projects in Nigeria including Reconstruction Of Umeze-Anam-Mmiata Road.
3) SETRACO NIGERIA LIMITED
Setraco Nigeria Limited is a leading engineering construction company with over 35 years working experience in delivering value-added civil and infrastructural projects. With projects executed successfully in over 20 states, and current presence in 15 states, Setraco has played a key role in developing Nigeria’s infrastructure. The company was established in 1977 and started by constructing township and district roads in what was then Bendel State. Over the years the company has rapidly grown to become one of the largest construction companies in Nigeria specialized in roads and bridges. With a presence today in over 15 states; Setraco has played a key role in developing Nigeria’s infrastructure.
4) COSTAIN WEST AFRICA
Costain West Africa Plc was incorporated in 1948 and initially it started as a private company and later on undertaken by John Holt and company from Liverpool.
Through John the company grew to a world class company with reputable construction experience in the construction industries such as civil engineering, open cast mining and dredging.
The company has carried reputable construction project both locally and internationally making it have the global experience to handle any kind of project before them.
5) BRUNELLI CONSTRUCTION COMPANY (NIGERIA) LIMITED
Brunelli Construction Co. (Nig.) Ltd. Was incorporated in Nigeria in 1972, which has grown into a large construction company in the past years. At present, the company has about six (6) expatriates as Senior Personnel, around 40 Nigerian as senior Management cadre and supervisor level. Brunelli Construction Company specializes in jetties construction, shore protection works, drainage construction, carnal dredging, concrete electric poles construction. They also work on
diaphragm wall installation as well as water treatment plant projects. Their headquarters is located in Lagos State.
6) DANTATA & SAWOE CONSTRUCTION COMPANY (NIGERIA) LIMITED
With a long history of delivering bespoke projects in Nigeria Dantata & Sawoe construction company is also one of the top construction firms in the country. Dantata & Sawoe construction company have been operating for more than 39 years. The firm has expertise in road constructions, bridge construction, airstrips construction, irritation projects as well as construction planning and design. Among its projects is IBCC International Broadcasting Center, AIT, DAAR Communications Abuja, Edo State House Liason Office Abuja, Benue State Government House among others.
7) SCHWARTZ KRISTOFFEL (SK)
SK is a company that is focused on technology and materials engineering. The company is known to customize civil engineering construction materials developed in the temperate region to suit the African setting particularly Nigeria. SK was founded in 1987 and is one of the top engineering companies in Nigeria. The company uses its access to technology to good use which has transformed the business from a technology and materials engineering company to a complete engineering procurement and construction (EPC) solution provider.
8) MONIER CONSTRUCTION COMPANY (NIGERIA) LIMITED
Monier Construction Company is one of the leading Civil Engineering and Construction Companies in the country. The company has been on the scene for over 5 decades and it is a member of the Federation of Building and Civil Engineering Contractors in Nigeria. Monier was incorporated in 1957 and the company’s head office is located Mile 7, Rumuigbo, Ikwerre Road, Port Harcourt, Rivers State.
The company has been involved in the construction of major roads and building across Nigeria. Monier also has state of the art construction equipment suitable for road construction, modern building and trench excavation.
MCC as it is popularly called is wholly owned and operated by Nigerians and the company has maintained a healthy presence in the South East, South-South and other parts of the country, where they have completed and delivered quality projects on schedule and budget.
9) ARAB CONTRACTORS (AC)
Arab Contractors is one of the best construction companies in not just Nigeria but Africa as a whole. The company has quite a diversified experience portfolio which includes: building bridges, road, tunnels, airport, housing, tunnels, sewage plants, hospitals, sports building, dams and power stations.
The company also offers engineering consultancy.
The Arab Contractors office in Nigeria is located at Ajose Adeogun Street, Victoria Island, Lagos. Some of the notable projects that have carried out by the company over the years include the reconstruction of the Owerri-Elele Road and the sanitation of the potable works in the Woi region of Abuja.
10) CHINA CIVIL ENGINEERING CONSTRUCTION COMPANY (CCECC) NIGERIA LTD
CCECC Nigeria is the company currently in charge of the Lagos Light Rail project. Also, it was CCECC that constructed the Ikorodu road. CCECC Nigeria is a subsidiary of CCECC, a China based company which was established in 1979 in Mainland China but has grown to become an international contractor with projects in over 40 countries.
11) SAIDI NIGERIA LTD
Saidi Nigeria Ltd was founded in 1997 and the company is made up of a unique team of qualified engineers and skill worker. The company is committed to developing the capacity of its team which explain why Saidi usually organizes frequent workshops and seminars to get their engineers trained and retrained. Their clients comprise both government and private individuals. Some of their projects include massive housing schemes, estates, road, bridges and dams.
Saidi Nigeria is also involved in constructing boreholes, dredging as well as setting up irrigation systems both in the rural and urban areas.
12) ELALAN CONSTRUCTION COMPANY
Elalan is one of the fastest growing construction and civil engineering firm in the country. The company was established in 1982 and its head office is located in Ikoyi, Lagos. Elalan is known to deliver high quality construction solutions which it has done consistently over the last 35 years. The company’s culture revolves around quality, integrity, flexibility and commitment and it is made up of a large team of over 1200 people. This workforce comprises both
indigenous professionals and expatriates. Currently, there are over 450 full time people while the rest comprise of skilled workers.
13) MIXTA NIGERIA
Mixta was established in 2006 as a subsidiary of ARM with a focus on real estate investment. Within the last 10 years, Mixta has successfully delivered over 3000 real estate assets which include homes, retail outlets and many more. The company’s asset is close to N30 billion
Mixta specializes in large scale real estate development projects and real estate advisory service and the company’s mission is to become the foremost real estate developer in the country by providing innovative solutions. The investment model comprises 3 aspects which include: build to sell, build to rent and build to operate.
The Oluwole Urban Mall currently being constructed in Lagos Island is one of the projects being undertaken by Mixta in partnership with the Lagos State Government.
14) NETCONSTRUCT
Located in Ikoyi, Lagos, NetConstruct is a reputable construction company in Nigeria that has successfully delivered over 2000 homes to its massive clientele. The company was established in 2001 into the real estate development.
15) HITECH CONSTRUCTION COMPANY
Hitech Construction. Founded by the Chagoury Group in 1988, Hitech is now one of Nigeria's top civil engineering companies.
Hot Company To Watch: Student Accommod8
In the last decade, it is reported that there has been a 12% annual average growth of student enrolment in Nigerian tertiary institutions. However, the provision of purpose-built student accommodation is less than 30% of the demand. The constant increase in the enrollment of students in tertiary institutions was one of the reasons why Student Accommod8 was birthed in April 2015, to solve the problem of hostel shortages across universities in the country. As at the time of the launch, the company revealed that it had plans to develop and/or acquire 15,000 bed spaces in the next 3-5 years.
In view of this, a statement released by the company stated that it had raised an undisclosed amount of debt funding through the Nigeria Infrastructure Debt Fund (NIDF), managed by Chapel Hill Denham to build more Purpose-Built Student Accommodation (PBSA). (www.thisdaylive.com/index.php/2019/07/09/student-accommod8-raises-debt-funding-for- hostels/).
The debt financing is being used for expansion of SA8’s two existing PBSAs, Sycamore House, a 192-bed development in Olabisi Onabanjo University, Ogun State, and Cedar House, a 140-bed residence in Pan Atlantic University, Lagos. These PBSAs have been built and designed to provide value added services including minimarts, cafeterias, laundry services and many more to not only the residents but also to the wider student community in the respective universities. The Founder/CEO of Student Accommod8, Abayomi Onasanya, said that student Accommod8 hostels are strategically placed close to universities or within the university’s campus. (punchng.com/student-accommod8-unveils-new-hostels-in-two-universities/) 2018
According to the developer, both residences were opened in October 2018, and each residence has value-added services such as communal area, kitchenette, minimart, laundromat and a cafeteria, in addition to bed spaces.
The CEO of the company Onasanya, further added that Student Accommodation is funded primarily by equity, with venture capital investors (Consonance Investment Managers) who have invested into the equity of the business, adding that the firm has plans to start development in Ilorin, Abuja and other parts of Lagos before the end of the year.
According to digestafrica, in 2018, Consonance Investment Managers invested $1, 300, 000 in Accommod8. The Investment Managers also announced the completion of an equity investment in Student Accommod8. The amount was said will be sued to further develop Accommod8’s portfolio of Purpose Built Student Accommodation, strengthen their talent pool and update their IT infrastructure.
Capital Investments
The turn of the century has witnessed a surge in Nigerian real estate market performance, with major institutional investors such as UACN Property Development Company, Stallion Property Development Company and Kontinental Development Company dominating the real estate market. Within the same period, the intergration of real estate into the capital market began with the listing of UACN Property Development Company in the Nigerian Stock Exchange. The development which is in line with global trend, engineered growth and structural changes that has necessitated the needs for investors to make informed investment decisions, Olaleye et al, 2010)
The Nigerian Real Estate Sector has recorded steady and consistent growth over the last four years becoming one of the greatest contributors to the Nation’s rebased GDP from the non-oil sector - having contributed 8.03% and 11% in 2013 and 2014 respectively. The market which is currently valued at approximately N6.5 Trillion is estimated to grow at an average of 10% over the next few years. The major growth drivers in the sector have been credited to: an increased inflow of foreign investment (especially from South Africa, MEA and the United States); increased institutional investment from local companies including PFAs and Mutual Funds; the growing population of High Net worth Individuals; and the targeted intervention of the Federal Government in the housing finance sector.
With the government’s capital expenditure on construction reaching USD 2.2bn in 2018, Nigeria is an interesting destination for investors in the construction industry. Beyond building schools, hospitals, social infrasture, the recent National Integrated Infrastructure Master Plan is addressing as estimated 17-million-unit housing deficit. As a consequence, Nigeria’s construction sector is growing at an ever fast pace, nearing a 9% year-on-year increase in the first quarter of 2018, according to reports by the Oxford Business Group.
Following this, according to The Big 5 Construct Nigeria, some of the companies that are projecting to invest in the country’s construction sector are: Rastone srl, an internationally
renowned company in the stone industry, is one of the companies that has Nigeria as its priority of investment in the construction sector. Others include: IVR, an Italian manufacture systems components and accessories for the sanitary, plumbing and heating sector.
Since 2007, when the Securities and Exchange Commission (SEC) introduced the framework for the establishment of Real Estate Investment Trust (REITs), the Nigerian investing public has been given an opportunity to invest in a diversified portfolio of choice real estate assets. The market regulators SEC, the Nigerian Stock Exchange (NSE), the Federal Inland Revenue Service (FIRS) and the Federal Government of Nigeria (FGN) have also continued to seek new ways in creating an enabling environment for this asset class to thrive - while bearing in mind its capacity to deliver stable long term value investment; meet Nigeria’s rising housing demand; attract foreign portfolio investment into the Nigerian Real Estate sector; support the drive for real estate infrastructure development and diversification from concentration of investments in traditional equities; and other fixed income instruments.
From inception to date, the market has witnessed the establishment of 5 REIT Schemes, 4 pure equity REIT schemes and 1 Hybrid scheme. It is notable that industry experts are getting a better grasp of this previously unpopular asset class, evidenced from the creativity and significant improvement in the structure of each subsequent REIT Scheme. The HMK REIT is seen to have utilized very creative credit enhancement models such as a Bank Guarantee to hedge credit losses, over-collaterization and the introduction of a market maker to stimulate liquidity for its units.
Values any construction company can bring to current operations
From the record which shows the increase rate of population growth in Nigeria, it can be deduced that:
➢ There is huge market opportunity for provision of affordable housing for the middle class
➢ Approximately 68% of the middle class population don’t own their own homes
➢ The demand drivers for housing in Abuja, Port Harcourt and Lagos and other major cities
can be summarized as:
• High population growth rate in the cities
• Increase in government and economic activities in urban areas
• Rural-urban drift which is presently estimated to be between 5% to 10% per annum
• Need for decent living conditions
• Acquisition of an investment hedge against inflation
Investment wise, approximately $375bn is required to bridge the Country's housing deficit
Around 70% of this deficit is concentrated in Nigeria’s most populous (and prosperous) states of Lagos and Kano, oil-rich states such as Rivers as well as the FCT (Abuja)
Consistent rise in population and GDP per Capital
Growing middle class according to the African Development Bank (AFDB); the middle class makes up about 23% of the Nigerian population
Developing aspiration to own personal homes
Unlike a decade ago, many Nigerians now aspire to own personal homes
REFERENCES
Adegboye, K. (2016), ‘Developer Unveils Show House at Lekki Pearl Estate, www.vanguardngr.com. Retrieved 9/2/2016 pp. 41 Adeogun, O. (2011), Housing Delivery through Public Private Partnership in Nigeria and the case of beneficiaries’ involvement’. Journal of Construction Project Management and Innovation’ Vol. 1, Issue 2, pp 63-79 Agbola, T. and Odunola, T. (2007), Housing Development and Management: Housing Policies and Programmes. Department of Urban and Regional Planning, Faculty of The Social Sciences, Ebie, S.P.O.F. (2004): Statutory Component(s) on Housing Policy – Legislative and Regulatory. Benjamin A. and Clinton A. (2018) Assessment OF Factors Affecting Trade Union in Nigerian Construction Industry: Proceedings of the International Conference on Industrial Engineering and Operations Management Washington DC, USA, September 27-29, 2018. Construction Review Online: https://constructionreviewonline.com/2017/09/top-5-construction- companies-in-nigeria/ Ebbinghaus, B. and J. Visser(2000).The Societies of Europe: Trade Unions in Western Europe Since 1945. Basingstoke, Macmillan Reference Ltd. Federal Government of Nigeria, FGN (1991) National Housing Policy for Nigeria, Federal Ministry of Works and Housing, Abuja. Ibrahim Rafindadi Abdulrahman (2016) Trends and Drivers of Affordable Housing Delivery in Nigeria International Journal of Scientific & Engineering Research, Volume 7, Issue 9. Ibem, E. O., and Amole, O. O., (2010), Evaluation of public housing programmes in Nigeria: A theoretical and conceptual approach, The Built Environment Review, 3, 88-116. NPC, 2006, National Population Census of Nigeria, Federal Republic of Nigeria.
Olaleye, A., Adegoke, O.J. and Oyewole,M.O. (2010), “A comparative analysis of the investment features of real estate and stocks in Nigeria”, Real Estate and Development Economics Research Journal, 2(1), 49 – 69. Omojinmi, I.O. (2000): SINA Technical Workshop on Housing Co-operatives, Nairobi 6 – 17 October. Omole, F.K (2001): Basic Issues in Housing Development. Femobless Publication, Ondo Onwuemenyi, O., 2008 “Nigerian Housing sector”, Punch, 29th January, Punch Newspapers Nigeria. Punch Newspaper (punchng.com/student-accommod8-unveils-new-hostels-in-two-universities) This Day Newspaper (www.thisdaylive.com/index.php/2019/07/09/student-accommod8-raises- debt-funding-for-hostels/ UNCH/HABITAT (1990), Developing a National Shelter Strategy: Lesson from Four Countries, Nairobi.