PROPERTY NEWS

PROPERTY development company, WEMABOD Estates Limited, has fashioned out fresh plans to commence exploring one of the core areas of the firm's original operational goals - property trading, with a view to checking the effects of the global economic meltdown in the country.

Under the plan, the indigenous firm will begin to acquire available landed properties, which will be built into estates and sold to the interested publics.

Until recently, WEMABOD has been involved mainly in developing and managing its properties. But under the new plans, the company will now be taking briefs to search for, buy and sell properties commercially.

Both the Chairman, Chief Dosu Fatokun, and Managing Director, Mr. Abdul Wahab Omotosho, spoke of the new direction in Lagos last week while addressing shareholders and other parties during the firm's Annual General Meeting (AGM).

The firm, which, due to the meltdown recorded a loss last year, is however hopeful for better returns in the next year.

Assessing the effect of the global meltdown, Fatokun said: "Even the real estate sector has not been immune to the financial meltdown as the prices of housing have deflated and cost of building is increasing on a daily basis. The number of potential buyers who have the wherewithal to consummate the sale have reduced and the banks that used to give financial support to big players in estate business are reluctant in doing so because they are the most hit with the economic meltdown.

"The general downturn in the economy impacted on the operations of the company during the period under review and this affected the overall operating results."

In his report on the activities of the company, Fatokun said that during the year, the company pursued more vigorously three of its major policy thrusts to add and create more wealth. These are in the areas of joint venture, redevelopment of old and derelict properties and making the presence of the company felt in all owner states by engaging in viable economic ventures.

Essentially, the firm partnered with PRI LCC, an American based property development company to redevelop some of its properties and enhance their values for higher returns. According to him, a memorandum of understanding was signed between the two companies and three special purpose vehicle companies were incorporated for the redevelopment of the three major properties of the company, that is, Gateway Property, 13 Park lane, Apapa and Development House, Apapa.

Also, the company laid the foundation stone for redevelopment of its property at Mokola roundabout in Ibadan into a multi-purpose building. The building would be completed in the second quarter of 2009.

Fatokun, an ex-President of the Nigerian Institution of Estate Surveyors and Valuers (NIESV) said the company would continue to vigorously pursue the policy of redeveloping its properties to enhance their values, acquiring properties for redevelopment in strategic locations, renewing the interests in expired leasehold properties arid impacting positively in all owner-states and catchment areas through building of hostel accommodation in institutions of higher learning in these states.

WEMABOD's Managing Director, Mr. AbdulWahab Omotosho, said that one of the major constraints the firm faced in the past year was the high debt profile of some of its tenants. "Huge outstanding rents and service charges owed the company by its tenants has been a major constraint to the company."

To checkmate this trend, Omotosho said WEMABOD had reconstituted its debt recovery department. "The management had reconstituted its debt recovery task force to pursue rent recovery, review locked-up spaces and cases in court for possibility of taking possession of spaces without necessarily running foul of the law and exploring out-of-court settlement for cases in courts."

He corroborated Fatokun's statement on the company's redevelopment. "Effort is also ongoing to redevelop all identified derelict properties to enhance their values. This is in addition to actively engaging in property trading, which is an area of core business of the company. With the completion of the new development at Mokola roundabout, Ibadan, other on-going projects and gradual picking up of the stock market, we see year 2009 to be a better year than 2008."