INTERVIEW: Our Target Is To Build Affordable Homes For Nigerian Masses – Pelican CEO
Dr. Babatunde Murtala Adeyemo broke into the real estate business like a whirlwind after years of meticulous planning and research. An ECOWAS Youth Ambassador is the young realtor who owns the growing nature Pelican Valley Nigeria Limited, a foremost Nigerian real estate firm behind the Pelican Valley Estate; Pelican-Brief Estate, Pelican Ecostay Apartments and Pelican Greenish Acres Farm Estate – all located at the Laderin – Abeokuta – Kobape corridor of Ogun State. In this engagement with BUKUNMI OJO & ABIGAEL, the Pelican Chief Executive Officer shared his thoughts on the rising cost of building materials, its grave implications to the building industry, structural integrity, efforts at bridging the nation’s widening housing deficit among other issues.
Prices of cement have gone up, oscillating between N10,000 and N15,000. How is that impacting on the pelican many projects?
The increase in prices of cement, not only cement, other building materials has really affected the whole estate industry in Nigeria as a whole in the sense that housing is one of the most essential means of livelihood and very important to human beings generally. Once the cost of making a house or a home is high definitely it will affect a whole lot of people not only the players in the construction industry, but the whole Nigerian economy would be affected. For example, the Nigerian real estate economy is now in comatose with some of the entrepreneurs running away, some businesses dying totally, while some are bankrupt and others are downsizing at the moment. The real estate entrepreneurs are planning to go on a total strike because of the trying time they face today. It’s the latest that I’m getting from our association, because the cost of production is becoming so much unbearable and unfortunately, a good number of the real estate entrepreneurs would have given their projects costs to quantity surveyors, before they started adverts and unfortunately the rate at which the inflation is affecting some of these raw materials has really made some of the real estate entrepreneurs to become what looks like people who should not be depended on to follow diligently the laid down plans on agreed projects. When you have a budget to build a house of N25m and you believe your profit margin would be within N5m but within a month or two, the price of building materials increased by as much as 60 percent, that means increase in cost of production and you may not be able to break even with that type economic climate let alone having profit from such investment. This is
where people lacking integrity start cutting corners, reducing the quality of building materials and this is no rocket science, where you are supposed to use 20mm iron and you want to do economy, you use 10mm iron or where you are supposed to use 10 bags of cement for casting and you now use seven bags of cement at the end of the day, it is not as if the building will not stand but it won’t stand for long and that’s the reason you have cases of building collapse. This may become rampant and frequent, especially during the rainy season. So, there’s need for the government to think out of the box. Also, the rate at which people are becoming homeless in Nigeria is so alarming. People are hungry, people are homeless and the economy is really on a downward trend. I would like to call on the federal and state governments to encourage and support more people especially, Nigerians who are in the real estate or construction industry. There’s need for us to make building affordable to all. We know it might be difficult, but government still has a lot to do towards this aspect of the increasing cost of building materials.
Pelican Valley is a success story, what inspired your passion for the evolving Ecostay apartments?
I’m a kind of a person that believes in starting small and grow naturally with time. I believe in continuous movement and growth. No matter how that growth or movement is and for me to have started the real estate business as capital intensive as it is with a very small sum of money and nurture it to become a household name is an attestation to that. I also believe that there’s nothing you can do without patience, perseverance and honesty. So, by starting a real estate business from day one, my target is to build affordable homes for people, particularly the Nigerian masses, but you know real estate business is capital intensive and if you want to start business you need millions upon millions of naira. I don’t have a supporter and I came from a very poor and humble family. I generated the funds by myself because what kills business easily is financing. So, what I did was to buy time and look for a way to generate my own revenue inwardly and if you want to generate inwardly you have to buy a lot of time. Construction of houses was my first love, but I don’t have the finance to do that, so that was why I started with the selling of land to gather funds bit by bit and later, we moved to selling houses.
So, we have successfully gathered strength selling lands, adding value to them and make those estates liveable. We provide basics infrastructure to enhance healthy habitation. When you make your environment liveable, you would have no need to put such property up for sale on promo level. You won’t drive it with promo because you have the entire infrastructure there, you don’t have to be in a hurry to sell lands in an estate where you have all the basic infrastructure. The best thing you can do for yourself is to add value to those lands and the only way you can add value is to build an estate. When you see an estate that is so aggressive to sell land, it shows that the land is not valuable, because if the land is valuable you won’t be advertising it so much. So, here in Pelican Valley, we are into building of luxury houses and by the grace of God, the sky is our limit.
Yes, you spoke earlier about housing deficit, with the current economic challenges in Nigeria, what is the hope for an average Nigerian to own a house?
About two years ago, housing deficit in Nigeria was like 20million. I wonder if it has not multiplied by two or three today because it is becoming very much visible now. It’s becoming scary, the rate at which the housing deficit gap is widening and it has always been there anyway. Housing deficit is one of the major factors that propelled me into this real estate business. There are no visible plans on ground and government at the centre has no visible and effective plan towards addressing or bridging the gap. No visible plans to solve the housing needs of an average Nigerian. There’s no rocket science about this thing, it’s practical, garbage in garbage out. If you don’t take holistic and futuristic approach towards solving the housing deficit in Nigeria, it won’t go away. This not about compensating a party man, if you really mean business, look for people with integrity, then you can reset. Look for these people that have track records, people that are doing it practically, like I said, it’s not a rocket science. If they give you all the billions in this life and you don’t know the arithmetic of turning one naira to two naira you will fail even in business. If you don’t have that self discipline to manage resources with track record you will fail. I want Mr. President to look for people with track records to help tackle rising cost of building materials, bridge the housing deficit among other challenges in the building and construction sector.
What makes your brand different from others?
It is the approach. Approach to business, you know from the word “Pelican” if you know the spirit behind pelican, it is the believe in community service. Let’s gather it together and we enjoy it together, it’s all about selflessness, most times and no matter what you are doing either in business or governance, if you are selfless and you are not always looking at your personal interest, it’s the people that will lift you up. So, most times, it’s not all about my business for personal interest, it is all about the passion that I have for the real estate investment and that has been pushing me ahead because once you gather this funds, I don’t see it as my money, I see it as investment funds and this investment funds are not meant for me to gallivant around. And to the glory of God, I’ve been in this business for almost 14 years without a single dispute, no court record case; we have 100 percent positive reviews on Google even on most of our social media platforms. The passion has been the one pushing us ahead of others and we are very attentive to details.
Could you please tell us what inspired you into real estate business?
I was inspired by the drive to have a second address. I used to be a journalist; I practiced journalism for almost 15 years. You know journalism does not really pay in terms of salary, but you have a lot of goodwill in journalism that makes you a multi billionaire. Journalism has the real goodwill. My zeal to have a second address as a journalist inspired me to be a real estate entrepreneur, because I want to be an effective journalist and I don’t want to be begging for money or blackmailing people and I don’t want the politicians to use me as a tool and the only way they will use you as a tool is when they have the economic power and you are depending on them for means of livelihood, but when you have that economic power by having a second address, you will not be vulnerable in the hands of politicians. So, I realized that this second address is becoming overwhelming, and is paying my bills. Where I was working as a journalist, I was owed four years salary and I didn’t even mind simply because I had another alternative job then which is the real estate business. My business was that strong before I officially quit journalism. So, it’s all about passion and I’m not tired, it’s about bringing change and bringing hope to the hopeless Nigerian youth. Average Nigerian youth think nothing good be achieved in this country but this is where we are and have achieved this much. It shows that if this man can make it out of journalism you too can also make it out of journalism.
How do you choose the location for your projects?
Choosing location as a real estate entrepreneur, I was inspired by true life’s and practical experience. I told you that I used to work in Lagos, and I was transferred from Lagos to Abeokuta. Before I left Lagos I have already built a house at Ibese in Ikorodu. So, from that Ikorodu to my office in Alausa secretariat, I would be in the traffic for almost two and the half hours everyday. So, when I was posted to Abeokuta, I drove from Alausa to Oke-mosan in just 55 minutes, I now said, this place is not Abeokuta, this is Lagos extension, because within Lagos I used to spend two and the half hours from my house to Alausa, So, now from my house in Abeokuta to Alausa is 55 minutes, it was then I felt I just have to do something around this area because it’s very close to Lagos and I know that Nigeria cannot continue to be like this forever at the end of the day we would have good roads we would have good train system. And when you even travelled out of the country, the average period people travelled to their work place most times is one hour, 40 minutes, some do two hours everyday.
You see people working in New York and living in New Jersey, we understand they travel from their home to their work. But now we are talking 55 minutes drive from Abeokuta to Ikeja, so it shows that, the Nigerian government is not really taking advantage of that proximity. Once we take proper advantage, we would link all these places together and it’s going to be for utmost benefit of Nigerian masses. So, before people realized that, I’ve given thought to it ahead of time positioned myself for development with this investment.
So, it’s a future thing and that’s what brought me here. It is the proximity as a practical experience was what brought me to this location.
Could you tell us about the project you are particularly more proud of and why?
I’m proud of all my projects, because they all have their own unique characteristics. For example, if you see this Pelican Valley you can see the landscape, you can see the aerial view, look through the window, the aerial view this is what people who go to Kenya, South Africa and Dubai to watch. You know when you talk about the aerial view, it’s so unique. So, Pelican valley has its own uniqueness landscape and when you look at Pelican Brief at Kobape, you will see that it is a place that you would want for a man. For our Ecostay apartment, it is 100 percent ecostay apartment in Ogun state, so it has its own unique characteristics as well. Pelican Greenish Acre Farm Estate has its own unique characteristics. So, all these products are products of the present and the future and they have their varying unique characteristics.
How do you stay updated on market trends and changes in the industry?
On a market trends, I don’t engage in competition, I always want to be myself and always want to work within our projects. So, most of the time I don’t compete at all.
Would you tell us the challenges you face during the process?
Most challenges are government policies. There are so many inconsistencies in government policies. When you talk about the Land Use Act is not all that is favourable to an average real estate entrepreneur and sometimes, governments use the Land Act descretionary. Having a likeminded work force you know as a real estate entrepreneur you cannot do it all alone, you have to hire people who share that dream with you and I’m a lover of youth and when we look at the situation in the country now, you realized that most of our youths are yahoo yahoo youths. I’ve been in this business for 14 years and when you bring them in they will want to be like me within one or two years, they want to be the CEO overnight. They don’t know that it takes time for one to mature and in the process they would want to use your own organization to take the ride just to get to that level. They would want to kill your organization to establish their own simply because they are just in a hurry to get there. That’s what an average Nigerian youth wants to adopt, for that not to happen, you have to be on top of your toes, you have to keep on watching, you will be the chief security officer. That is where most of real estate companies usually get it wrong. Once you establish many estates that you cannot monitor by yourself, those youths you engaged as managers of your many estates would eat and destroy them and at the end of the day, they won’t even use that money they stole from your investment to start the business. So having a workforce of likeminds to paddle the canoe of your organization is always a challenge in a country like Nigeria, even the good ones may stay long with you. They want to leave the country. So, the inconsistency in government’s policy and the troubles of managing disloyal employees are the major challenges in every businesses in Nigeria, including real estate.
Could you tell us how you ensure sustainability and environmental consideration in your projects?
It’s very easy, once you know that all your estates have full government approved layout. For example, Pelican Brief layout at Kobape is the only estate in Ogun state in the last three and the half years that was able to secure full government approved layout and before you can get the government approved layout you must do environmental impact assessment, one that would be done by a professional, you will do your topography survey, you will do engineering layout of your electrification project, so those are things that government has put in place to control the development in any approved estate. Once you can get all that in place, forget it, it will take care of the questions that you have asked.
What do you think the real estate business looks like today in Nigeria?
It is very tough sincerely. The reason is that a significant percentage of real estate entrepreneurs in Nigeria don’t have a solid foundation and everything in life is all about foundation. Real estate business is just like a Cumulative Grade Points Average (CGPA) thing in the university, once you fail in your year one they use that failure and the unit to divide your GP till you graduate. Same thing happens in the real estate business once you don’t get your foundation right, if you don’t do what you are supposed to do and you start selling lands with promo at the end of the day all those liabilities you will carry it till the end and they will eventually weigh you down. At least five percent of the real estate entrepreneurs in Nigeria are carrying such baggages, unless we have a new breed of entrepreneurs to merge with the older generations like Oke Owo, look at how they are practicing their own real estate business. When we have younger people who can do it the way they’re doing it, the real estate business will have a brighter future but if you’re still doing it like yahoo yahoo estates, you sell lands, make money and disappear, you will only be creating slum instead of having an estate.
