Continental Estates

[hispy99]

THISDAY ONLINE

The Board of Directors of Continental Estates Limited have resolved to increase the authorised share capital of the company by 75 per cent, from N1.billion to N1.75billion.

THISDAY gathered that this would be effected by the creation of 1.5 billion ordinary shares of 50kobo each ranking in pari-passu with the existing ordinary shares of the company.
The decision was reached at an Extraordinary General Meeting of the company held recently in Lagos.

The statement disclosed that the Board of Directors at the EGM sought and got the authority of other shareholders to raise additional capital for the purpose of enlarging the scope of business of the company. The fresh capital, which will be raised through a placement offering, will increase the company’s shareholders’ funds to over N4.billion from the current N1.03billion.
Shareholders have authorised the directors to exercise their discretion in considering the amount of excess funds due from the placement offering that would be effectively utilised to achieve the company’s business purposes.
‘The fresh capital that will be sourced from select private investors will help the company achieve its primary objective, which is to develop the real estate in Nigeria. The money will be used to develop commercial and residential properties within and outside Lagos’, the statement said.

The placement offering is expected to kick-off next Monday (July 21).
Continental Estates Limited was incorporated in 1997. The company started business as Continental Properties, which today ranks as an industry leader in its provision of outstanding real estate products and services to a broad range of institutional and private clients.

The company’s commanding leadership is a tribute to its unassailable track record in creating real values for its clientele over the years. In just about 11 years of its inception, Continental Properties has leveraged on opportunities created by its goodwill to increase profitability as well increase its area of competencies.

This increased scope of operations gave birth to Continental Estates Limited, which core business is property development, facility management and trading. The company is ably run by professionals with extensive industry experience and unusual grasp of the dynamics of the Nigerian real estate market.With its quintessential management team the company has been inspired to hone its competencies across various market segments. It has proactively and strategically taken positions at locations of best investment advantage and poised to use its track records and knowledge of the property market to achieve a quick and commendable return on investment.

[solainvest]

The Punch: ¡®Real estate business is Nigeria¡¯s next goldmine¡¯

How did the Continental Estates start?

I remember clearly we started in 1997 and after two to three months, we were able to get the other name Continental Estates Limited. We actually applied for the two of them but one came out before the other for so many reasons and we went out with Continental Properties, so we had to use the proprietary name Continental Estate for assets holding.

To what extent have you achieved your mission as an estate developer?

Continental properties is a firm of seasoned realtors and we’ve been able to make significant impact in the market. We started from Ikeja, in a small office. We started with letting exercises, representing clients, as agents and I would say we’ve been lucky from day one. We’ve always had lots of high network individuals as our clientele. We’ve been able to evolve into something bigger than even myself. We’ve moved office from Ikeja after having impacted the local market in Ikeja. The facts are there for everybody to verify. We’ve been able to cultivate our integrity, we’ve been able to cultivate the fact that we are market makers; we’ve been able to cultivate the fact that we are intelligent and seasoned brokers. We are very relevant in our industry. But the whole vision is to grow beyond our industry. Continental Properties has been moved from Ikeja Plaza to a Victoria Island shop on Ligali Ayorinde. The V.I shop was nice for us. Like in a normal season as you witness growth there is a need for you to expand and so many things come with growth but when we thought it was time for us to move again we moved office to our current address which is in Lekki. I can tell you that since we moved to Lekki, the environment has not been the same. When we moved into Lekki, as usual we did our due diligence. We’ve mapped out our strategies; we’ve been able to take Lekki from bottom line with or without infrastructure. I can tell you that since we’ve moved to Lekki, it is not as if much has happened in terms of infrastructure development but enjoy the benefits of creative marketers who can highlight the potential inherent in every other property. The whole vision is to build an institution that will transcend myself, which will transcend each and every one of us like we’ve seen them do out there in civilized countries. Nigeria is a seriously emerging economy, the opportunities there are phenomenal.

Beside the administrative office, how much investment do you have in Lekki?

We own 20 houses on one side of Lekki. It is called Regal Seaview, it adjoins Goshen Beach Estate which is on the right side of Lekki, then 20 units off regal sea view, the houses have been delivered we are having challenges on the access to the scheme. We own a couple of other houses on the other side of Lekki; they are all listed out in our global valuation. From all observations and experience, we’ve come to terms with it that the idea of owning one and selling with the attempt to buy another one, since replacement cost is huge, might not be worth it. So that is what has informed our pile up of portfolio. As at today our portfolio is clear, there is about N2.9bn in assets. We’ve got a couple of exposures but all our exposures till date are well below N500m. We have development leases in one or two locations in Ikoyi. Our asset is huge.

What is your assessment of real estate investment in Nigeria now and in future?

In Nigeria, we haven’t recorded a diminishing return on real estate; I know fully well that there is still a huge gap in meeting the investment opportunities. But the government’s policies and their summersault have not helped matter. If you go through the policies, they are nice policies but they are not real policies, and the implementation has been poor so far. If you look at the housing policy, the government is making concerted efforts through the National Housing Fund but you and I know that these things are not real. We are talking about affordable housing. At whatever level, the minimum return on real estate investment is going to be averaging about 40 per cent.

Are you trying to say the next place to move to is the real estate?

I tell you there is nowhere else like real estate. The richest men in the world, if you look at their wealth, the bulk of it comes from the real estates. I can’t remember exactly now but I know about 90 per cent of the world’s richest men thrive on real estates. People whose wealth are phenomenal and will last about four generations without effort are in real estate. I tell you it is an exodus in Nigeria. The capital market was very interesting we all knew it was seasonal. We all knew that some of the companies have fundamentals but how well are the fundamentals? Principally, how many of them have good fundamentals? I can tell you the core people that were doing capital market still have their stock of real estate that they are doing.


How is your company tapping into the opportunities available in the real estate sector?

First, we feel the demands exceed the supply because we have instances where one man owns 100 units and 1,000 people do not have access to them at all. We are looking at how the local macroeconomics is going to affect the company. Our emphasis had been Lagos; we are looking at branch expansion. We are looking at playing in Abuja; we are looking at having presence in the South-South. We have this demand to acquire. We equally have the tendency not to sell unless it is really exigent. It is really crucial. Our core competence in the past had been more of property trading and facility management. And this, we intend to grow and grow phenomenally. There are so many opportunities out there that our local players cannot take. Why? Because they haven’t got the capacity to take, that is what we are trying to do. To be able to accommodate the new, the growing high end market. You are aware of the direct foreign investment into Nigeria. That is booming and if you are talking about sustaining the company’s growth, our income and all of that, we are looking at areas where we can cater for the high-end market. The same effort you put in managing an apartment in Oko-Oba, I can tell you is a lower effort you put in managing an apartment in Ikoyi. The man in Ikoyi is high-tech. He just uses his email. He knows his rights; you, as an agent, know your rights. The landlord knows his rights. The terms and conditions of the relationship are well spelt out in the contract and when it time for renewal, one or two mails will do that. But the man in the downtown has challenges to pay the N150, 000 per annum rent. In terms of the fortunes of the company, our emphasis will be to look more predominantly at the high-end market. Our emphasis again would have been to focus more on our development arm, broad spectrum. Board spectrum, our development arm, will cater for low income housing estates in areas that are well deserved, areas where the demand will pick to ends of town. We intend to cater for the middle class. We have our locations already where we can develop about 52 housing units. We have our template and our land and location. We are at the preliminary level now where we want to do about 52 family units. It is called middle class multi family units. We haven’t come up with a brand name for it but it is already on.

The location is between the second and third roundabout in the site and service scheme there. For the high market, ultimately we are looking at doing our Ikoyi apartments. We’ve got three locations in Ikoyi that we want to do. We are at the preliminary level too. We are going to be doing multi floor family apartments there. With the direct foreign investment into the Nigerian market too, many shops are opened, so many people globally are beginning to realise that the local market in Nigeria is very attractive for their various businesses. One of the first things they will need is commercial real estate and then maybe backed up with one serious luxury apartment for the CEO and then the other managers can be given housing allowances and the rest of them. So we have two locations between first and second roundabout that we are going to be doing, about 3,500sqm letable space, first class. Like I told you it is going to be developed by Everest styling. And the whole idea is if we can deliver these units in 12 months, hopefully we should be able to realise about 35,000sqm. So if we do a three-year take on, that gives us about N300m rental income. We are going to be doing facility management; this is just one of the schemes.

[bivins1]

oya make una see the proposal . to buy or not to buy . nothing is hidden because you can get this from their website ehich is Continental Estates Limited | Estate Agency, Property & Facility Management, Property Investments, Estate Development

[XXCASH]

For me, this is certainly a NO NO
- Business concept too easy, a couple of us can start this today
- A PO before june next year, i guess that should be a typo error
- PE for 2008 is 20, which i doubt they can even achieve. What are they trying to tell us that they would go from the minor profit in 2007 to over 500million. Clap for them
- And finally they sound very unprofessional

Well just my humble opinion, i only spent 20mins on the proposal and wasn't interested in reading any further

[bivins1]

i be think say na only me see am ooo. I dont really know what these guys take us for. I just wanted to be sure i wasnt the only one seeing the way you saw it . na wa

[tonidol]

Originally Posted by bivins1

i be think say na only me see am ooo. I dont really know what these guys take us for. I just wanted to be sure i wasnt the only one seeing the way you saw it . na wa

Do we still have people buying PP's of this nature with all the goodies in the secondary market. I need to float PP to fund my secondary market intentions too o.

[BLUEMONEY]

Originally Posted by tonidol

Do we still have people buying PP's of this nature with all the goodies in the secondary market. I need to float PP to fund my secondary market intentions too o.

Very Funny

[Curious]

Originally Posted by XXCASH

For me, this is certainly a NO NO
- Business concept too easy, a couple of us can start this today
- A PO before june next year, i guess that should be a typo error
- PE for 2008 is 20, which i doubt they can even achieve. What are they trying to tell us that they would go from the minor profit in 2007 to over 500million. Clap for them
- And finally they sound very unprofessional

Well just my humble opinion, i only spent 20mins on the proposal and wasn't interested in reading any further

Playing the defence for this company...
You're right. Business concept is quite easy but then thats the same for so many other very profitable companies. Barrier for entry is higher than you think for two reasons. Prime real estate is hard to come by and its usually very very expensive. Just try to buy a plot in Parkview and get back to me.
Company is already sitting on some prime land in Banana Island, Parkview and others and we all know that developers in those areas make a killing. On a different note, if the concept was that easy, how come there are that many sizeable companies doing this??
IPO planned for Q2 next year but that depends on what new rule the exchange/SEC puts in place.

As to how much they can make. It perhaps sounds ambitious but if someone told you 2 years ago that land in Parkview would be going for over $1,000 per sq meter, I suspect you'd think the person don craze finish.

Unprofessional? Hmmm. I guess all the CEOs/MDs of all the profitable and listed companies sound professional

But seriously, I'm trying to give a perspective that shows a different angle.