{"id":5084,"date":"2017-06-27T00:08:09","date_gmt":"2017-06-27T00:08:09","guid":{"rendered":"https:\/\/amazingproperty.com.ng\/blog\/?p=5084"},"modified":"2017-06-27T00:08:09","modified_gmt":"2017-06-27T00:08:09","slug":"recession-developer-predicts-boom-for-real-estate-sector","status":"publish","type":"post","link":"https:\/\/amazingproperty.com.ng\/blog\/recession-developer-predicts-boom-for-real-estate-sector\/","title":{"rendered":"Recession: Developer predicts boom for real estate sector"},"content":{"rendered":"<p> [ad_1]<br \/>\n<\/p>\n<div itemprop=\"description\" readability=\"174\">\n<p>By Kingsley Adegboye<\/p>\n<p><strong><em>M<\/em><\/strong><strong><em>r. Adetokunbo Ajayi is the Managing Director\/Chief Executive Officer, Propertygate Development and Investment Plc. He spoke to Vanguard Homes &amp; Property on the out look for <a href=\"https:\/\/amazingproperty.com.ng\/blog\/property-center-nigeria\/\">real estate<\/a> sector of the nation\u2019s economy.<\/em><\/strong><\/p>\n<p><!-- between content ad --><\/p>\n<figure id=\"attachment_821246\" style=\"width: 303px\" class=\"wp-caption alignleft\"><img data-recalc-dims=\"1\" loading=\"lazy\" decoding=\"async\" src=\"https:\/\/i0.wp.com\/d19lga30codh7.cloudfront.net\/wp-content\/uploads\/2017\/06\/Ajayi.png?resize=303%2C312\" data-lazy-src=\"https:\/\/i0.wp.com\/d19lga30codh7.cloudfront.net\/wp-content\/plugins\/lazy-load\/images\/1x1.trans.gif\" class=\" wp-image-821246\" alt=\"\" width=\"303\" height=\"312\"\/><noscript><img data-recalc-dims=\"1\" loading=\"lazy\" decoding=\"async\" class=\" wp-image-821246\" src=\"https:\/\/i0.wp.com\/d19lga30codh7.cloudfront.net\/wp-content\/uploads\/2017\/06\/Ajayi.png?resize=303%2C312\" alt=\"\" width=\"303\" height=\"312\"\/><\/noscript><figcaption class=\"wp-caption-text\">\u2022Mr. Adetokunbo Ajayi<\/figcaption><\/figure>\n<p>Following projected improvement in global productivity growth for 2017 by the International Monetary Fund, IMF, with activities in both advanced economies and emerging markets as well as developing economies expected to accelerate in the year, real estate sector of the nation\u2019s economy is set to experience boom.<\/p>\n<p>Managing Director and Chief Executive Officer, Propertygate Development and Investment Plc, a Lagos-based real estate development and investment company, Mr. Adetokunbo Ajayi, disclosed this in an interview with <em>Vanguard Homes &amp; Property<\/em> during the company\u2019s sixth Annual General Meeting last week.<\/p>\n<p>He said the real estate sector\u2019s contribution to GDP in 2016 suffered a decline compared to the preceding year. Ajayi added that lending to the sector dropped and those brave enough to lend did so at very high rates, pointing out that according to CBN\u2019s reports in the year, maximum lending rate was as high as 36 per cent per annum for development activities and 32 per cent per annum for <a href=\"https:\/\/amazingproperty.com.ng\/blog\/mortgage-preapproval-guide-for-home-buyers\/\">mortgage<\/a> in some banks.<\/p>\n<p><strong>Investment <\/strong><strong>activities <\/strong><\/p>\n<p>He noted that with the economy in downward slope, aggregate demand plunged and real estate development and investment activities suffered a major setback, just as at the continental level, the sector also suffered a setback in the year under review, leading to investment from international investors slowing down.<\/p>\n<p>Of note, according to the Propertygate boss, was the drop in capital inflow from South African investors who shifted their attention to Eastern Europe, adding that operating environment in 2016 was particularly difficult for the country and businesses, as the country went into recession within the year and ended with a negative GDP growth of 1.51 per cent.<\/p>\n<p>According to him: \u201cThe economic challenges of the year included inflation at record high 18.71 per cent, drastic fall in national revenue, acute scarcity of forex, badly weakened naira, decline in foreign and local investment, high interest rate, and atmosphere of uncertainty. Most sectors of the economy were adversely impacted.\u201d<\/p>\n<p>He is, however, optimistic that, the real estate sector of the nation will enjoy boom this year going by IMF report that the global productivity growth for 2017 is projected to show improvement compared to 2016. This is just as economic activities in both advanced economies, emerging markets and developing economies are expected to accelerate in 2017, with global growth for the zones projected at 3.4 per cent and 3.6 per cent respectively, compared to 2.4 per cent and 2.5 per cent in 2016.<\/p>\n<p>Ajayi said, \u201cThe primary factor underlying the strengthening global outlook in 2017 is the projected rise in emerging markets and developing economies growth. At home, the IMF revised its 2017 forecast for Nigeria, as it predicts a positive growth for the economy. Positive indicators in the year so far are all pointing to economic recovery.<\/p>\n<p>\u201cThese indicators include increased oil production, security improvement in the oil rich Niger Delta, ongoing success in the war against insurgency in the volatile North East, the recent intervention of the Central Bank of Nigeria in the forex market aimed at achieving convergence of currency exchange rates, and inflation dropping from 18.71 per cent at the beginning of 2017 to 17.24 per cent as at April 2017 according to Nigeria Bureau of statistics.<\/p>\n<p>\u201cThe renewed assurance by governments at various levels to improve diversification of the economy, block leakages, and improve efficiency and ease of doing business are also reassuring to businesses. For the real estate sector, we are optimistic of an improvement in its fortune. According to PricewaterhouseCoopers in its report, \u2018Emerging Trends in Real Estate: The Global Outlook 2017\u2019, it is striking that while concerns around geopolitics are at unprecedented levels in recent times, confidence in the ongoing flows of capital into real estate remain high.<\/p>\n<p>\u201cThe report further noted that the consensus was that the current macro-environment of geopolitical uncertainty and fragile economic growth is set to remain a strong feature but interestingly added that consensus was that real estate will remain in risk-off mode. The report noted that global cross border investment into real estate is holding up given the chase for yield and real estate\u2019s position as a safe haven.<\/p>\n<p>\u201cWe believe that at home, a combination of factors will help to drive growth in the sector. These include population strength of the country and its growth rate, growth in the economy, and increase in the flow of foreign\/local capital, with investors returning to the sector.\u201d<\/p>\n<p>Others include massive expansion in infrastructure by government, the readiness of operators in the sector to leverage on the much awaited government investment in infrastructure and the need for real estate products and services which remains very huge.\u201d<\/p>\n<p>Speaking during the AGM, the Propertygate helmsman noted that at a corporate level, the company believes the huge potentials of the Nigerian economy and the vast opportunities in the sector would remain strong. He added that the company, in demonstration of its commitment, will continue its development and investment activities in residential and <a href=\"https:\/\/amazingproperty.com.ng\/blog\/nigeria-property-center\/\">commercial properties<\/a>, in addition to other opportunities it intends to leverage on within its strategic plan.<\/p>\n<p>He disclosed that further to the company\u2019s commitment to give back to the community, the company completed had the construction of a 372 metre long road leading its estate at Sangotedo, Lekki, Lagos which began in 2015 within the year under review.<\/p>\n<p>Mr. Peter Folikwe, a director in the company, said \u201cPropertygate has remained resilient despite the prevailing economic challenges in the country as it affects the sector. This is attributable to visionary leadership of the board and management team. The company is exploring new frontiers with it\u2019s Propertygate Center, hence, the future looks very bright for the company\u201d.\u201cMr. Wole Ogungbola, another director in the company, noted that \u201cRelative to the global and local economic performance, Propertygate has recorded a strong performance. It is now clear that the company is more positioned to weather the storm of economic challenges in the years ahead\u201d.<\/p>\n<\/p><\/div>\n<p>[ad_2]<br \/>\n<br \/><a hre=\"http:\/\/www.vanguardngr.com\/2017\/06\/recession-developer-predicts-boom-real-estate-sector\/\"> Vanguard <\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>[ad_1] By Kingsley Adegboye Mr. Adetokunbo Ajayi is the Managing Director\/Chief Executive Officer, Propertygate Development and &hellip; <a title=\"Recession: Developer predicts boom for real estate sector\" class=\"hm-read-more\" href=\"https:\/\/amazingproperty.com.ng\/blog\/recession-developer-predicts-boom-for-real-estate-sector\/\"><span class=\"screen-reader-text\">Recession: Developer predicts boom for real estate sector<\/span>Read more<\/a><\/p>\n","protected":false},"author":1,"featured_media":5085,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"advanced_seo_description":"","jetpack_seo_html_title":"","jetpack_seo_noindex":false,"jetpack_seo_schema_type":"","_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_feature_clip_id":0,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2},"jetpack_post_was_ever_published":false},"categories":[4],"tags":[519,15239,9685,2890,524,1399,12908,543,617,684,1384,408,522,2886,15272,818,84,857,15282,15319],"class_list":["post-5084","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-opportunities-in-new-markets","tag-africa","tag-chase","tag-commercial-properties","tag-construction","tag-continent","tag-development","tag-home","tag-home-buying-guide","tag-house","tag-lagos","tag-lekk","tag-mortgage","tag-nigeria","tag-optimistic","tag-outlook","tag-real","tag-real-estate","tag-real-estate-sector","tag-ross","tag-weather"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"https:\/\/i0.wp.com\/amazingproperty.com.ng\/blog\/wp-content\/uploads\/2017\/06\/Ajayi.png?fit=280%2C280&ssl=1","jetpack_sharing_enabled":true,"jetpack-related-posts":[{"id":5000,"url":"https:\/\/amazingproperty.com.ng\/blog\/growth-target-hinged-on-infrastructure-investment\/","url_meta":{"origin":5084,"position":0},"title":"Growth target hinged on infrastructure investment","author":"Amazing Property","date":"June 19, 2017","format":false,"excerpt":"Chief Executive Officer of Propertygate Development and Investment Plc, Mr Adetokunbo Ajayi. Despite the current economic downturns, future growth could be guaranteed, if government effectively implements a combination of factors that will boost the real estate sector. Such factors according to the Managing Director of Propertygate Development and Investment PLC,\u2026","rel":"","context":"In &quot;Opportunities In New Markets&quot;","block_context":{"text":"Opportunities In New Markets","link":"https:\/\/amazingproperty.com.ng\/blog\/category\/opportunities-in-new-markets\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/amazingproperty.com.ng\/blog\/wp-content\/uploads\/2017\/06\/Adetokunbo-Ajayi.jpg?fit=640%2C360&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/amazingproperty.com.ng\/blog\/wp-content\/uploads\/2017\/06\/Adetokunbo-Ajayi.jpg?fit=640%2C360&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/amazingproperty.com.ng\/blog\/wp-content\/uploads\/2017\/06\/Adetokunbo-Ajayi.jpg?fit=640%2C360&ssl=1&resize=525%2C300 1.5x"},"classes":[]},{"id":7537,"url":"https:\/\/amazingproperty.com.ng\/blog\/taxation-violation-of-environmental-laws-undermine-real-estate-sector-propertygate-m-d\/","url_meta":{"origin":5084,"position":1},"title":"Taxation, violation of environmental  laws undermine  real estate sector- Propertygate M.D.","author":"Amazing Property","date":"December 19, 2017","format":false,"excerpt":"By\u00a0By Kingsley Adegboye A front line real estate developer and Managing Director and Chief Executive Officer, Propertygate Development and Investment Plc, Mr. Adetokunbo Ajayi, in this interview with Vanguard Homes & Property reviews the essence of taxation and how non-compliance with taxation rules by many operators in the real estate\u2026","rel":"","context":"In &quot;Opportunities In New Markets&quot;","block_context":{"text":"Opportunities In New Markets","link":"https:\/\/amazingproperty.com.ng\/blog\/category\/opportunities-in-new-markets\/"},"img":{"alt_text":"Propertygate 1.jpg","src":"https:\/\/i0.wp.com\/amazingproperty.com.ng\/blog\/wp-content\/uploads\/2017\/12\/PROPERTYGATE-1.jpg?fit=412%2C397&ssl=1&resize=350%2C200","width":350,"height":200},"classes":[]},{"id":6286,"url":"https:\/\/amazingproperty.com.ng\/blog\/property-market-developers-still-see-gloom-despite-exiting-economic-recession\/","url_meta":{"origin":5084,"position":2},"title":"Property market: Developers still see gloom despite exiting economic recession","author":"Amazing Property","date":"September 19, 2017","format":false,"excerpt":"By\u00a0Kingsley Adegboye IN spite of the cheering news that the country is getting out of\u00a0 economic recession, the bleak outlook of the housing sector of the nation\u2019s economy will remain a major cause for concern for real estate developers and the survival of their businesses in the country. This is\u2026","rel":"","context":"In &quot;Opportunities In New Markets&quot;","block_context":{"text":"Opportunities In New Markets","link":"https:\/\/amazingproperty.com.ng\/blog\/category\/opportunities-in-new-markets\/"},"img":{"alt_text":"LAGOS-ESTATE-1.jpg","src":"https:\/\/i0.wp.com\/amazingproperty.com.ng\/blog\/wp-content\/uploads\/2017\/08\/LAGOS-ESTATE-1.jpg?fit=412%2C250&ssl=1&resize=350%2C200","width":350,"height":200},"classes":[]},{"id":4821,"url":"https:\/\/amazingproperty.com.ng\/blog\/experts-propose-funding-options-for-real-estate\/","url_meta":{"origin":5084,"position":3},"title":"Experts propose funding options for real estate","author":"Amazing Property","date":"June 5, 2017","format":false,"excerpt":"At the recent meeting in London with the theme \u201cTrends Shifting Real Estate Capital Flows in Sub-Saharan Africa was the African Chapter\u2019s \u00a0\u00a0first London\u2019s GRI forum, an official of Ecobank Nigeria Plc, Mr Kunle Osilaja led the discussion on how Africa compares to other emerging global markets. Leading real estate\u2026","rel":"","context":"In &quot;Opportunities In New Markets&quot;","block_context":{"text":"Opportunities In New Markets","link":"https:\/\/amazingproperty.com.ng\/blog\/category\/opportunities-in-new-markets\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/amazingproperty.com.ng\/blog\/wp-content\/uploads\/2017\/06\/Global-Real-Estate-Transparency-Index.jpg?fit=1200%2C674&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/amazingproperty.com.ng\/blog\/wp-content\/uploads\/2017\/06\/Global-Real-Estate-Transparency-Index.jpg?fit=1200%2C674&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/amazingproperty.com.ng\/blog\/wp-content\/uploads\/2017\/06\/Global-Real-Estate-Transparency-Index.jpg?fit=1200%2C674&ssl=1&resize=525%2C300 1.5x, https:\/\/i0.wp.com\/amazingproperty.com.ng\/blog\/wp-content\/uploads\/2017\/06\/Global-Real-Estate-Transparency-Index.jpg?fit=1200%2C674&ssl=1&resize=700%2C400 2x, https:\/\/i0.wp.com\/amazingproperty.com.ng\/blog\/wp-content\/uploads\/2017\/06\/Global-Real-Estate-Transparency-Index.jpg?fit=1200%2C674&ssl=1&resize=1050%2C600 3x"},"classes":[]},{"id":8920,"url":"https:\/\/amazingproperty.com.ng\/blog\/how-private-developers-stave-off-lull-in-property-market\/","url_meta":{"origin":5084,"position":4},"title":"How private developers stave off lull in property market","author":"Amazing Property","date":"September 24, 2018","format":false,"excerpt":"Since the marginal recovery from the recession last year, the real estate sector is still lagging behind general economic performance because of an uncontrollable micro economic index. 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This new revelation stems from the real estate conference West African Property Investment Summit (WAPI) recently held in Lagos at Eko hotel and Suits Expo Centre. 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