The rise in Abuja land charges

The Abuja Geographic Information Systems (AGIS) of the Federal Capital Territory Administration (FCTA) on Tuesday, Oct. 14, 2014 announced upward review of development levy charges for one of Federal Capital City (FCC)’s districts, Katampe (B07).  Entitled “Katampe (B07) District Infrastructure Development”, government said plot allottees in the place will now pay N8,000sqm because of “First-class/world-standard […]

The Abuja Geographic Information Systems (AGIS) of the Federal Capital Territory Administration (FCTA) on Tuesday, Oct. 14, 2014 announced upward review of development levy charges for one of Federal Capital City (FCC)’s districts, Katampe (B07).  Entitled “Katampe (B07) District Infrastructure Development”, government said plot allottees in the place will now pay N8,000sqm because of “First-class/world-standard infrastructure construction of the district through Public-Private Partnership (PPP)”. This affects all allocations from inception to date, regardless of previous payments. Land owners were advised to go collect their new bills at the information and customer desk of AGIS.
This is the first time a review of development levy charges is so done for an unserviced district in Abuja.
Katampe (B07) would have been less than N8,000/sqm but it is said the place being a rough terrain, doing infrastructure is difficult. This accounts for the difference in cost with similar districts.
When Daily Trust visited Katampe, land owners said they had no knowledge of the review yet. The quantum of work done by the private developer was not obvious because roads are still dirt. Even the road that passes beside the construction yard of the developer is dusty and rugged. Those bothered with the matter ask why review of charges before the infrastructure are provided.
A senior staff of Grand Towers, the company that owns the Grand Towers Hotel in Katampe said, “There’re no sewage line, electricity, water. Now residents are mobilised to provide a police post in the area.”
Deanshanger Project Ltd (DPL) is the developer here. It was difficult laying hand on the contract documents but it is clear that the company is to build roads and do asphaltic concrete finishing. It will construct drains, culverts of various sizes and lay kerbs. It will provide water and electricity including street lighting.
A representative of the developer whose name was simply given as Segun declined to give information on state of things on the site. He told this reporter on phone, “Everything with Katampe has to do with FCDA [Federal Capital Development Authority]. Go to FCT [Administration]. They’re government. I’m not government. It’s a government issue, not contractor issue.”
A staff of Aurecon Consulting Engineering, the company that represents the developer on site said though infrastructure are not visible, it does not mean works are not being done.
Apart from development charges, other charges troubling Abuja residents are: premium, ground rent and tenement rate.
Development charges in Abuja districts vary based on “fully/partially/unserviced serviced areas”. While land for housing estates costs N2,500/sqm, plots in the fully serviced Central Business District is N10,000/sqm. Fully serviced Asokoro, Maitama and Wuse attract N8,000/sqm.
What the land is used for also determines cost. For example, motor parks for public use, bus depot/transport terminals cost N500/sqm; hospitals/clinics/health centres cost N1,000/sqm.
How were charges arrived at?
The costs of doing infrastructure in a district are summed up, the number of plots determined then cost per square meter fixed. It is on pro rata basis. Someone who has 1,000/sqm pays the cost of a square meter (N10,000) multiplied by 1,000 meters. Such plot in the Central Business District will attract N10 million.
In FCT, development charges are paid before the issuance of a C-of-O. FCT imposed the development levy in 2000. The money is intended to be used for the provision of infrastructure particularly in areas of the city that are yet to have such facilities. It is expected that the money collected will be remitted directly to the contractor that will do the infrastructure.
According to the chairman of the Nigerian Institution of Estate Surveyors and Valuers, Abuja Branch, Mr Emmanuel Alao government’s action is justified because the topography of Katampe is different from other districts.
“That’s why the development charges are reviewed considering the charges by the provider of the infrastructure. As it were, the cost of servicing a plot in Katampe is very high because of the topography, when you talk of sewage, water, electricity. The cost may be high but definitely they [property owners] will get value for their money.
“You see that Katampe has been a pocket of bush in the city. Many governments came and avoided Katampe because of the huge cost of providing development,” Alao expressed.
An estate valuer, Imoette Udosen Warsaw sees nothing unusual about what government has done. “Now, it’s obvious that government can’t provide infrastructure. Government can’t tar a whole district,” he stated.  
Warsaw who is director of Abuja-based estate firm, Country Home, acknowledged that property prices in Katampe will definitely be inflated.
Though AGIS director Hajiya Jamila Tangaza declined to speak on the review, the Managing Director of Abuja Property Development Company (APDC), Arc. Bashir Haiba said it is the best thing government has done. He illustrates his position with the following scenario: “Somebody applies, gets a plot of land, pays N100,000 for the application, pays N2 million or maximum of N5 million to get 1,000/sqm in an area. Having paid that, he expects all infrastructure to be in place.
“But go to the market, that same individual has taken that plot of land, sold it in the open market at the cost of N30 million, N40 million. I ask you one thing. What has that money done in the Nigerian economy to get the deferential between N5 million and N30 million? Something can’t be out of nothing. That money is the anticipated money of the infrastructure they’re waiting for government to come and put down. To me that policy is absolutely right.”