Stakeholders in the building sector have blamed poor funding and project viability for the 250,000 abandoned building projects in the country.
The stakeholders, while speaking during telephone conversations with newsmen, stressed that the issue is not simply a housing problem.
Last week, it was reported that the Federal Government disclosed that about 250,000 housing units in abandoned projects could potentially be recovered and made available to Nigerians, including civil servants.
The Minister of Housing and Urban Development, Dr Muttaqha Darma, disclosed this recently in Abuja at the presentation of houses to 430 staff members of the Nigerian Midstream and Downstream Petroleum Regulatory Authority.
Darma disclosed that the government was taking stock of abandoned housing projects across the country as part of efforts to increase the nation’s housing stock.
According to him, “about 250,000 housing units in abandoned projects could potentially be recovered and made available to Nigerians, including civil servants. We are taking stock of them. We are taking statistics. We are moving to each and every state where we have these abandoned properties.”
However, reacting to the development, an estate surveyor and valuer and the Principal Partner of Lekan Akinwumi & Co, Olalekan Akinwumi, in a chat with newsmen, said, “The high rate of abandoned buildings in Nigeria is largely a financing and project viability problem, not simply a housing problem.
However, it is important to ask who owns the property, why it was abandoned, and where it is located.”
Akinwumi argued that it was not proper to say that there were 250,000 abandoned housing units without understanding the circumstances behind each one.
According to him, someone who had unrestricted access to funds but lost that funding source could not be treated in the same way as someone who struggled to finance construction and was eventually pushed out by inflation and rising construction costs. “The cause of abandonment matters. The government also abandons housing projects; therefore, the issue is not peculiar to private property owners.”
Akinwumi reiterated that some of the major causes of the high rate of abandoned buildings included inadequate or interrupted funding, stressing that developers commenced projects without securing the funding required for completion.
“Rising costs of cement, steel, labour and other inputs can make an initially viable project financially unviable. Some projects commence without adequate market analysis, cash-flow projections, net present value, internal rate of return and sensitivity analysis. They can help the project either to start or not,” Akinwumi stated.
Also speaking, a former National Chairman of the Association of Estate Agents in Nigeria, Jatto Isah, argued that the government did not have the right to take over privately owned abandoned buildings.
“If they are privately owned, the government doesn’t have the power to take over the property because they will have to revoke the ownership of the property,” he stated.
Isah, however, stressed that for the government to take over the abandoned buildings, it must be for the interest of the general public. “And if they are doing that, it must be for the general interest of Nigerians, not for individual purposes. They can take over and finish them.
“Then, as to the cause of the high rate of abandoned buildings, I will say it’s due to the rising cost of building materials; it’s above the reach of an average Nigerian. For example, you have a budget to build a particular house, but along the line, you discover that due to the rising cost of building materials, it will no longer be viable to complete the house.
“What you will do is abandon the building. Maybe when the money comes, you will continue. But for the government to take over, it’s not possible,” Isah said.
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