Ayo Alonge, [email protected]
Oluwatobi Osonuga is the managing director of Chateau Royal Real Estate Limited as well as the founder of several real estate businesses, including Scott Harris Realtor, Shortlet-Lagos and Lagos Realtors Hub.
For Osonuga, the real estate business may be quite challenging and competitive, yet very lucrative for both entrepreneurs and investors. In this interview, he gives tips to government on SMEs growth.
Starting up
Growing up, I had always been intrigued by the idea of entrepreneurship. I have always wanted to provide solutions to problems, build and create initiatives that would bring about a change in Nigeria and on the global scene. My focus was on the Nigerian real estate market. So, Chateau Real estate Limited was incorporated out of the need to provide affordable luxury property offering to working Nigerians and make property ownership accessible and practical. Over the years, we have been able to make a good number of Nigerians property owners and helped many grow their wealth through real estate investment.
Seed capital
Like many Nigerian entrepreneurs, raising capital has always been a challenging task. Having to constantly pitch groundbreaking business ideas to potential investors who either probably don’t believe enough in your dream or are seemingly uninterested in the SME ecosystem.
Challenges
The most prominent has to be the bureaucratic process of allocation and registration of charges on land. The land registration process can take as long as 12 months and can be very frustrating. Another is the constant infiltration of the market by fraudulent land owners with outrageous property offerings.
Profitability
Real estate, undoubtedly, remains the most lucrative type of investment and the best way to exponentially grow your income. About 90 per cent of the world’s millionaires got their wealth by investing in real estate. A good real estate investment will yield over 30 to 40 per cent returns on investment in 12 months. Other assets cannot give you that. For investors, it remains the most viable means of wealth creation. The Nigerian real estate market is highly competitive. There are a plethora of real estate companies in Lagos State alone. It is impossible to keep up. However, value offerings differ and that’s what makes us stand out. At Chateau Royal Real Estate Limited, our drive to provide exceptional experiences to our existing and subsequent clients is what makes us unique. Our focus is guaranteeing all clients a “royal experience” because we understand that they are the core of our existence. We ensure they have a seamless property purchase process and help them through the journey into ownership.
Best practices
I can say the business here is definitely different from what is obtainable elsewhere because of government’s active involvement in the industry. Here in Nigeria, we just started putting workable structures in place and I can say for a fact that it is a very lucrative business with a more seamless experience. I mean, if home ownership level is 84 per cent in Indonesia, 75 per cent in Kenya and 56 per cent in South Africa, a lot more people are open to the idea of real estate investment and ownership. It will be easier to offer value to them.
Entrepreneurial development
We are committed to engaging many youths, both skilled and unskilled, at every level of our business, also providing them with cutting edge and hands-on training, with our partnership. With Heal the World Foundation and some other NGOs, we help reach out to more people. Starting a business all alone and without support can be a very unexciting journey. This is why we try to provide a helping hand, in an advisory capacity to new realtors and even provide mentorship for a lot, starting with members of my staff. I believe the sky is big enough for everyone to thrive; so, sharing my knowledge and my experience of the business so far gives me great pleasure.
Loan for expansion
Several times, there are some reasons why I decided not to follow through. Asides the bureaucratic loan application process, the real estate market is still recovering from a lot of economic challenges and this also affected real estate developers unable to recover their investments in existing properties, thereby hindering further capital spendings in new properties and buildings. We have sold over four estates and currently, we have fast selling projects like Maplewoods Plus, opposite La Campagne Tropicana Resort, Ibeju-Lekki; Rubyfields Okun-Imedu, Ibeju Lekki, De-Luxe Bespoke Sangotedo, behind Novare Mall and De-Luxe Bespoke, opposite Christopher University, Mowe. Our property offerings come with a very flexible payment plan of over 36 months to allow low and medium income earners be a part.
Government’s influence in real estate SMEs
Small and Medium-scale Enterprises (SMEs) are the life-blood of most economies. The effect of the global COVID-19 pandemic has also taken a toll on the majority of small businesses, leading to the closure of many and increasing unemployment rate in the country. On the other hand, SMEs in other African countries like Ghana, Kenya and South Africa have been able to thrive in the midst of the harsh economy, due to the support from their government. The same cannot be said for the Nigerian business scene. I recommend that the government should enforce laws and regulations that link institutional development and the entrepreneurial endeavours and to create an environment that will encourage entrepreneurs to develop businesses and new ventures.