Read Real Estate Outlook (Construction) Part 1 By Omoniyi Onabule Esq

The reason Real Estate is not invincible to the invisible COVID-19 cannot be farfetched, ranging from low consumer confidence which translates to lower housing demand, falling incomes and affordability pressures, and also productivity loss as a result of lockdown affecting retail, office spaces etc.

It is not rocket science but pure economics, if the populace is suffering widespread fear for the future and general uncertainty, it will inevitably result into lower demand for housing and invariably a fall in real estate transactions while there is increased supply.

Interestingly, one of the positives for Nigerian real estate is with respect to health care facilities, that would see quite a number to be established or upgraded with the N500,000,000,000 (Five Hundred Billion) intervention fund sought to be created by the Federal Government.

Furthermore, The Nigeria Centre for Disease Control (‘NCDC’) has access to a Regional Disease Surveillance Systems (‘REDISSE’) facility from the World Bank in the sum of US$90 million, out of which US$8 million has been drawn. The Nigerian government has requested to fully draw down on the outstanding balance of US$82 million. The Government has also requested for additional financing in the sum of US$100 million from the REDISSE project to meet COVID-19 emergency needs in all the 36 States and the FCT, through the NCDC and Federal Ministry of Health.

An interesting point to note is the fact that there will be construction of quarantine or healthcare facilities at all borders of the Country due to the growing concern of the increase rate of contact in border countries such as Chad as reported by the Minister of Health. The government is also looking at expanding the capacity of intensive Care Units (ICU), enhance laboratory capacity, accelerate the procurement of test kits, strengthen surveillance mechanisms as well as improve information management. The Federal Government has provided N102.5 billion in resources to be available for direct interventions in the healthcare sector. Of this sum, N6.5 billion has already been made available to the NCDC for critical expenditure. The Federal Government has also provided Lagos State with N10 billion in emergency funding.

The foregoing may sound like a good news but the situation of the health care is dire at the moment and this is evident from the conversion of stadiums to isolation centers when there are no facilities to accommodate high numbers of people tested positive of COVID-19 should in case the numbers rises up to thousands. Some countries even built health facilities that can accommodate thousands within a month such as China. Although this may not be visible in Nigeria as projects are naturally inclined to be delayed, it still goes to show why the Government of Nigeria may continue to look at development of Healthcare facilities post COVID-19 and the beginning can be seen in the much talked revised 2020 budget where Healthcare received more attention.

In Delta State, Nigeria, it was reported that a patient of COVID-19 (index case) died in a private hospital as a result of improper handling of the index case, this has somewhat pushed the Delta State Government to mandate private hospitals to report any case immediately to the government and National Center for Diseases Control (NCDC) for proper directive and also making the state government have the believe that its healthcare facilities is the first and reliable option in the state.

In essence, the Writer expects that post COVID-19, the health sector will receive more funding from budget allocation compared to what it has been receiving in the past as it has now been regarded as a critical sector due to the pandemics. Also, the Writer expects to see the development of more health facilities in fear of future pandemics and this may further draw more investors to provide investment or more foundations like the Ali Baba Foundation, Bill Gates Foundation, Dangote Foundation etc. to assist with funding as the perspective of the health sector will be altered forever being one of essential service and capable of continued operation during outbreaks.

To be continued…