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Build operate, transfer of property development can reduce housing deficit in Nigeria

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6 years ago

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By Ikenna Lansar Aghaji

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Housing Deficit in Nigeria – The housing sector of Nigeria has been experiencing  housing deficit since the civil war in the 60’s, and the lack of enthusiasm by subsequent governments to take responsibility for this anomaly has caused an increase in this situation nationwide; both in the rural and urban settlements which are either qualitative or quantitative respectively. Housing deficit is not peculiar to Nigeria only but to the world, however, the reasons for the shortage of housing units in Nigeria are cases of national concern. Looking at how long the government has tried to curb these issues one would be left to wonder whether or not the situation of housing deficit is a defeat-able one. Certain things prevalent in the Nigerian environment has increased the deficit of housing, they include the following; insecurity, intertribal/inter-religious wars; harsh economic conditions; Increase in population; migration into the urban regions

A good look at the condition of the housing deficit in Nigeria will reveal that Nigeria needs decisive and intense actions that would involve more than just a single service provider in the sector of infrastructural development. Most Experts in national development have found answers in the partnership agreement between a private firm and a public agency. Public-private partnership (PPP) is a form of agreement between public and private sector agencies, typically on a long term basis. As a developing nation, Nigeria has also keyed into the Public-private partnership schemes in various sectors of national development including the housing sector.

The Build Operate and Transfer (BOT) is a type of partnership where a Private Partner (an Estate Surveyor & Valuer) builds a property according to specifications given to it by the Owner of the property which could either be a public agency or an individual, operates the property by renting it out to tenants or short let users within the specified time (a period which he recoups his capital and makes a profit), and then transfers the property back to the Owner at the end of the contract time. In this type of arrangement, the Private Partner is responsible for the major bulk of the financial requirements for such a project; these finances are mostly sourced through bank loans or personal funds, more importantly, the risks are shared between both partners so as to maximise the value of services rendered. Nigeria has a lot to gain from a partnership project which benefits both parties such as BOT, especially in areas where there have been obvious challenges such as is seen in the housing sector of the country. BOT has the potential to reduce the housing deficit problems in Nigeria due to the not too complex structure of the partnership. This article discusses how the Build Operate Transfer (BOT) type of Public-Private Partnership can be used as a tool for resolving the housing deficit problem in Nigeria. Below are some of the ways in which Build Operate Transfer can reduce the housing deficit problem in Nigeria:

INCREASED NUMBER OF HOUSING UNITS

The situation of housing deficit in Nigeria has become a matter of urgency, which is why a PPP like Build Operate Transfer helps in making available housing units to the population through the efficient use of the massive human, technological and financial resources available to the private partnering firm. In BOT projects, there is a minimal situation of abandonment of projects unlike in projects executed by the public sector or a single individual, where there are hardly enough funds to carry out massive housing units projects that can cater for the population or a long process for the release of funds for projects, and continuous awarding of contracts to different firms without actually achieving the set goals. The Private Partner firm, which happens to be in charge of financing, building and the eventual operation of the housing units, understands that the project is both a form of investment and has an overall impact on the development of the housing sector and is able to cause an increase in the comfort of the population who happens to be the major focus of both parties involved.

INCREASED STANDARD OF  HOUSING UNITS

When considering the condition of the housing deficit, the standard of housing units is as important as the number of units. Due to constant monitoring by the Party granting concession and an understanding of the fact that the property is a long term investment, there is a high standard in the quality of materials used and the type of properties built. The Private Partner is aware of the fact that the project is a long term project, therefore the firm ensures to build quality housing units that would serve the needs of those that would acquire such housing units, also the quality of these housing units would ensure that the units can actually stand through the time allocated to the private firm for its running and even more after it has been transferred to the public sector.

CONVENIENT LEASE/SALE PROCEDURE

According to the document released by the government at the early stages of PPP in Nigeria (2002), the essence of bringing in the private sector is to ensure that the private sector plays an efficient role in supplying cost-effective housing units to the population.As opposed to the rigorous process involved in acquiring a property directly from the public sector, acquiring property from a private firm is less stressful and requires fewer procedures. This is because the Private Partner firm has already gotten all the necessary documents from the public sector which ensures the credibility of the property thereby increasing the interest of individuals that have a need for housing units. Also, the involvement of the public sector/ individual ensures that the properties are at a subsidised rate thereby making it more affordable than it would have been if it was solely owned by the private firm. From the above considerations of the positive impact of BOT on the housing sector of Nigeria, one would find that this type of partnership is able to handle the three most notorious reasons/causes of housing deficit, which are a low standard of housing units, shortage of housing units, and high cost of housing units. This means that BOT is a healthy and effective way to handle the housing deficit problem in Nigeria if given proper consideration by the government, and a well laid down legislation towards land and housing.

*Ikenna Lansar Aghaji is the principal partner of Lansar Aghaji & Co a firm of Estate Surveyors, Valuers and Auctioneers.

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Economy

Nigeria champions African-Arab trade to boost agribusiness, industrial growth

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3 days ago

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December 5, 2025

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The Arab Africa Trade Bridges (AATB) Program and the Federal Republic of Nigeria formalized a partnership with the signing of the AATB Membership Agreement, officially welcoming Nigeria as the Program’s newest member country. The signing ceremony took place in Abuja on the sidelines of the 5th AATB Board of Governors Meeting, hosted by the Federal Government of Nigeria.

The Membership Agreement was signed by Eng. Adeeb Y. Al Aama, the CEO of the International Islamic Trade Finance Corporation (ITFC) and AATB Program Secretary General, and H.E. Mr. Wale Edun, Minister of Finance and Coordinating Minister of the Economy, Federal Republic of Nigeria. The Agreement will provide a strategic and operational framework to support Nigeria’s efforts in trade competitiveness, promote export diversification, strengthen priority value chains, and advance capacity-building efforts in line with national development priorities. Areas of collaboration will include trade promotion, agribusiness modernization, SME development, businessmen missions, trade facilitation, logistics efficiency, and digital trade readiness.

The Honourable Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun, called for deeper trade collaboration between African and Arab nations, stressing the importance of value-added Agribusiness and industrial partnerships for regional growth. Speaking in Abuja at the Agribusiness Matchmaking Forum ahead of the AATB Board of Governors Meeting, the Minister said the shifting global economy makes it essential for African and Arab nations to rely more on regional cooperation, investment and shared markets.

He highlighted projections showing Arab-Africa trade could grow by more than US$37 billion in the next three years and urged partners to prioritize value addition rather than raw commodity exports. He noted that Nigeria’s growing industrial base and upcoming National Single Window reforms will support efficiency, investment and private-sector expansion.

“This is a moment to turn opportunity into action”, he said. “By working together, we can build stronger value chains, create jobs and support prosperity across our regions”, Edun emphasized. “As African and Arab nations embark on this journey of deeper trade collaboration, the potential for growth and development is vast. With a shared vision and commitment to value-added partnerships, we can unlock new opportunities, drive economic growth, and create a brighter future for our people.”

Speaking during the event, Eng. Adeeb Y. Al Aama, Chief Executive Officer of ITFC and Secretary General of the AATB Program, stated: “We are pleased to welcome Nigeria to be part of the AATB Program. Nigeria stands as one of Africa’s most dynamic and resilient economies in Africa, with a rapidly expanding private sector and strong potential across agribusiness, energy, manufacturing, and digital industries. Through this Membership Agreement, we look forward to collaborating closely with Nigerian institutions to strengthen value chains, expand regional market access, enhance trade finance and investment opportunities, and support the country’s development priorities.”

The signing of this Agreement underscores AATB’s continued engagement with African countries and its evolving portfolio of programs supporting trade and investment. In recent years, AATB has worked on initiatives across agribusiness, textiles, logistics, digital trade, export readiness under the AfCFTA framework, and other regional initiatives such as the Common African Agro-Parks (CAAPs) Programme.

With Nigeria’s accession, the AATB Program extends it’s presence in the region and adds a key partner working toward advancing trade-led development and fostering inclusive economic growth.

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Economy

FEC approves 2026–2028 MTEF, projects N34.33trn revenue 

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4 days ago

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December 4, 2025

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Federal Executive Council (FEC) has approved the 2026–2028 Medium-Term Expenditure Framework (MTEF), a key fiscal document that outlines Nigeria’s revenue expectations, macroeconomic assumptions, and spending priorities for the next three years. The approval followed Wednesday’s FEC meeting presided over by President Bola Tinubu at the State House, Abuja. The Minister of Budget and Economic Planning, Senator Atiku Bagudu made this known after the meeting.

The Minister said the Federal Government is projecting a total revenue inflow of N34.33 trillion in 2026, including N4.98 trillion expected from government-owned enterprises. Bagudu said that the projected revenue is N6.55 trillion lower than earlier estimates, adding that federal allocations are expected to drop by about N9.4 trillion, representing a 16% decline compared to the 2025 budget.

He said that statutory transfers are expected to amount to about N3 trillion within the same fiscal year. On macroeconomic assumptions, FEC adopted an oil production benchmark of 2.6 million barrels per day (mbpd) for 2026, although a more conservative 1.8 mbpd will be used for budgeting purposes. An oil price benchmark of $64 per barrel and an exchange rate of N1,512 per dollar were also approved.

Bagudu said the exchange rate assumption reflects projections tied to economic and political developments ahead of the 2027 general elections. He said the exchange rate assumption took into account the fiscal outlook ahead of the 2027 general elections.

The minister said that all the parameters were based on macroeconomic analysis by the Budget Office and other relevant agencies. Bagudu said FEC also reviewed comments from cabinet members before approving the Medium-Term Fiscal Expenditure Ceiling (MFTEC), which sets expenditure limits. Earlier, the Senate approved the external borrowing plan of $21.5 billion presented by President Tinubu for consideration The loans, according to the Senate, were part of the MTEF and Fiscal Strategy Paper (FSP) for the 2025 budget.

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Economy

CBN hikes interest on treasury Bills above inflation rate

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4 days ago

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December 4, 2025

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The spot rate on Nigerian Treasury bills has been increased by 146 basis points by the Central Bank of Nigeria (CBN) following tight subscription levels at the main auction on Wednesday. The spot rate on Treasury bills with one-year maturity has now surpassed Nigeria’s 16.05% inflation by 145 basis points following a recent decision to keep the policy rate at 27%. 

The Apex Bank came to the primary market with N700 billion Treasury bills offer size across standard tenors, including 91-day, 182-day and 364 day maturities. Details from the auction results showed that demand settled slightly above the total offers as investors began to seek higher returns on naira assets despite disinflation.

Total subscription came in at about N775 billion versus N700 billion offers floated at the main auction. The results showed rising appetite for duration as investors parked about 90% of their bids on Nigerian Treasury bills with 364 days maturity. The CBN opened N100 billion worth of 91 days bills for subscription, but the offer received underwhelming bids totalling N44.17 billion.

The CBN allotted N42.80 billion for the short-term instrument at the spot rate of 15.30%, the same as the previous auction. Total demand for 182 days Nigerian Treasury bills settled at N33.38 billion as against N150 billion that the authority pushed out for subscription. The CBN raised N30.36 billion from 182 days bills allotted to investors at the spot rate of 15.50%, the same as the previous auction.

Investors staked N697.29 billion on N450 billion in 364-day Treasury bills that was offered for subscription. The CBN raised N636.46 billion from the longest tenor at the spot rate of 17.50%, up from 16.04% at the previous auction.

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