In this interview, the Group Managing Director, Haldane McCall PLC, Mr Edward Akinlade speaks on the Company’s proposed listing on the NGX, its interests in the hospitality sector and the fault lines of the government policy as they affect the real estate and how the sector can be revamped to contribute to the Nigerian Gross Domestic Product (GDP).
What are the major challenges facing the housing sector in Nigeria?
The challenges are enormous. What we want from the government of the day is to provide us with an enabling environment in so many areas.
Most of the materials being used in the industry are imported. Volatility of Naira Exchange rate is impacting businesses in this sector. This brings about the high cost of construction in Nigeria. We contend with multiple taxation, also inadequate skilled workers is a major challenge as there are situations where you have to go outside Nigeria to find skilled professionals to do the work, not to mention how getting approval from governments to do our construction work is often fraught with bureaucratic bottlenecks.
We pay as much as 30 percent interest on loans from banks in Nigeria. Many people in the construction industry leverage their own capital to do business. This makes it difficult to operate optimally, unlike advanced countries where there is access to loans at low interest.
How can these be addressed?
The way forward is political will. Where there is will, there is a way. Our politicians are not that keen in supporting the housing market. That is why the challenges are increasing by the day. The Government needs to address the issue of interest rates to make it competitive.
Nigeria should invest more in technical education to increase skilled manpower. We used to have technical colleges in the past. The schools were producing skilled workers like carpenters, bricklayers, technicians and a host of others. We expect multiple to be reduced under the ongoing Tax Reform. Generally, the ease of doing business should be given a priority to attract more investors into real estate.
We hope the new administration will implement policies that will enable those of us in the real estate industry to operate optimally and contribute to the growth of the country’s Gross Domestic Product (GDP). As for the hospitality industry, there are many mushroom hotels in Nigeria. Multiple taxation and other anti-business policies have continued to stifle the companies’ ability to make profit.
During the recent Investors Forum of Haldane McCall PLC in Lagos, you said the company could partner the federal government to address housing deficits in Nigeria. How realistic is this?
Very simple and highly realistic. I still maintain that our politicians are not interested because they have crude to sell. Yes, I said during the investors forum that the state governments and federal government can give developers land to go and develop within a period of time. It’s the developer giving back to the government for the value of the land given at the start. This model does not cost the government any amount as the only person that will finance the project is the developer. This model is cost-effective for the government and realistic. But are our politicians interested?
You are so passionate about Haldane McCall PLC. What is so unique about this company?
Our vision is to create a company that would enable the creation of a sustainable developmental framework for Africa. We would achieve our vision by positively engaging all stakeholders in all our areas of operations.
The Company intends to intensify its drive for sourcing and identifying viable investment opportunities in the African emerging markets. The strategy among others is to buy existing hotels, invest, remodel and finally rebrand for optimality.
We are optimistic that the strategic plan of ‘Express Hotels’ and the sustenance of the three virtues below will enhance the Company’s prospect of having a prominent position in the hospitality industry in Nigeria and beyond.
Can you shed more light on the Company’s strategic growth plan?
We have a well-defined strategic growth plan that includes expanding our market presence and exploring new opportunities. Your investment will be part of an exciting journey towards expanding our horizons and securing a brighter future. Our presence in both real estate and hospitality sectors ensures that your investment remains resilient in a rapidly evolving market. Our future projections indicate promising returns on investments. We’re committed to maximising value for our investors as we continue to grow and innovate. With a history of profitable ventures and a dedicated team of industry experts, we have consistently delivered exceptional results.
Apart from real estate investment, Haldane McCall is said to be a major player in the hospitality industry. Can you provide an insight?
We are well-diversified. We own the Suru brand in Nigeria. That is why you will find Suru Express Hotel, We have Suru Express Plus Hotel, Lagos. We also own one in Ikeja, one in Surulere, and one in Ikorodu. We cater for the middle class with affordable hotel needs rather than luxury. The one at Ikorodu is about 92 rooms, the one in Surulere is 21 rooms while the one at GRA is 32 rooms . Our rates are competitive. We deliver quality service.
Haldane McCall is planning to seek listing by Introduction on Nigerian Exchange Limited (NGX) in the first quarter of 2024. What motivates the proposed plan?
We know the primary benefits of listing, which include risk diversification and by implication, opportunity for continuity is a company as the ownership base is widened. We also want our directors to cut across different professional backgrounds. Listing puts a company on the global map as an organisation that upholds the sanctity of corporate governance through compliance with the Post Listing Requirements of NGX.
There is no doubt that listing creates multiple opportunities for a company to access capital from the markets as there are various financing options. Haldane McCall is a baked cake that we want many investors to simply slice and eat.
After the listing, is there a plan to expand the shareholders base by floating bond?
We are not going through that route at the moment. That is why we are seeking approval for listing by Introduction. It means prior to our listing, we have complied with the Listing Requirements of NGX. We are already engaging the Capital Market Regulators through our appointed agents – the market operators.
After the listing, we shall be at liberty to deploy Initial Public Offering (IPO) and other financial assets to mobilise funds from the market.
Haldane McCall may also float bonds to raise long term funds in the future?
That option is on the cards. When we get to that bridge, we shall cross it. We shall definitely issue bonds in the future to finance our expansion into affordable housing, particularly in Lagos and Abuja,and also to expand our hotels in Abuja, God shall see us through.
What is the company’s dividend policy?
Our dividend policy is to distribute 30 percent of all our profits after tax annually to our shareholders.
Stockbrokers’ President, Adeosun hails late Ogunbanjo as icon of Nigeria’s corporate community
The President and Chairman of Chartered Institute of Stockbrokers (CIS), Mr Oluwole Adeosun, has hailed the late Honorary Fellow of the Institute, Mr Chris Ogunbanjo for his sterling contributions to the growth and development of the Nigerian capital market while regarding him as an icon of Nigeria’s corporate community.
Ogunbanjo, the father of the immediate past Chairman of NGX Group PLC, Otunba Abimbola Ogunbanjo, who was invested as a Honorary Fellow of the Institute in December last year, passed on recently and the late corporate legal icon was celebrated by the Institute, including the closing gong ceremony on Nigerian Exchange Limited (NGX).
Speaking at the tribute ceremony in honour in Lagos at the weekend, Adeosun explained that he was actively involved in the incorporation of NGX when it was called the Lagos Stock Exchange at its formative year.
“He served as Chairman of the 120-member Consultative Committee on Company Law – a body set up by the Federal Government in 1989 to advise it on a new Companies Decree which was promulgated into law in January 1990.
“Chief (Dr.) Chris Ogunbanjo established a reputation, not only for nurturing many successful industrial ventures in Nigeria but also for promoting education, research and the achievement of a stable society through The Chris Ogunbanjo Foundation. He was actively involved in the incorporation of the Nigerian Exchange Group (NGX) when it was known as Lagos Stock Exchange.
“The Late Chief Chris Ogunbanjo was an icon of the Nigerian corporate community, a most distinguished and eminent achiever whose record in corporate Nigeria is second to none. He enrolled as a Barrister-at-Law and Solicitor of the Supreme Court of Nigeria in August, 1950.
“Since that time, he achieved several remarkable milestones, of which space can only allow me to mention a few: He was the first Chairman of the Nigerian Council for Management Development Education and Training, the governing body of the Centre for Management Development from 1972 to 1983,” said Adeosun.
The Chairman, NGX Group PLC, Dr Umaru Kwairanga also showered encomiums on the late Ogunbanjo saying, “Chief Ogunbanjo’s legacy is woven into the very fabric of the Nigerian corporate landscape. On the corridors of the Nigerian Exchange Group, his presence was not just influential but transformative.
“As a guiding force on the Council of the Nigerian Stock Exchange, he played a pivotal role in shaping the direction of NSE, and his impact reached far beyond the confines of boardrooms.”
As part of its 30th Anniversary celebrations over the last 12 months, CIS, has granted honorary fellowship to the following eminent distinguished Nigerians: Dr Goodie Ibru; Alh Aliko Mohammed; General Ibrahim Babangida. ( Rtd); Chief Chris Ogunbanjo; Mr Mustafa Chike-Obi and Mr Aigboje Aig-Imoukhuede.