Real estate is a viable business sector in Nigeria largely because of the enabling regulatory environment, large expanse of land and huge deficit in housing development vis-a-vis the population of the nation (about 20 million housing units as at October 2021). According to This Day News, in 2021, the Gross Domestic Product (GDP) of the Nigerian real estate industry recorded a positive growth, a 2.3% increase from ₦3.96 trillion recorded in the year 2022. According to the GDP Report for Q1 2022 published by the National Bureau of Statistics, Nigeria’s real estate sector grew by 10.84% and contributed 5.34% (over $5 Billion) to the real GDP of the nation.
Real estate business in Nigeria has diverse opportunities and each part is duly regulated. There are construction and property development companies, property management and short let businesses, estate survey and valuation businesses, real estate agency business, and so on. Interestingly, the sector allows foreigners to set up real estate companies subject to meeting local law requirements. The following article details out our answers to some frequently asked questions on how to set up a real estate company in Nigeria.
1. What are the requirements for incorporating a real estate company in Nigeria?
The incorporation of a company in Nigeria is the prerogative of the Corporate Affairs Commission (“CAC”). There is no prescribed minimum share capital for real estate companies. However, where a foreigner is amongst the directors or shareholders, the minimum share capital must be N10,000,000 (Ten Million Naira).
Below are the requirements for registering a company in Nigeria.
- Two proposed names for the company: these names will be submitted to the CAC for name search, screening and approval. Upon approval, the promoters may thereafter proceed to register the real estate company with the approved name;
- Proposed Registered Address, Email Address and Phone Number of the Company;
- Details of the Shareholders, Director(s) and Company Secretary to include their Names, Contact/Home Address, Email address, Phone number, Date of Birth, Occupation, a copy of National Identity Slip/ Card showing the National Identity Number (“NIN”), and Electronic signatures.
- Objects of the Company: Please confirm that the proposed company is being registered as a real estate company with specifics on the expertise area.
You can learn more about the requirements for registering a company in Nigeria here.
2. What post-incorporation registrations and approvals do a real estate company require to operate in Nigeria?
The following are the post-incorporation registrations that must be completed for a real estate company:
2.1 Tax Registration with Federal Inland Revenue Service (“FIRS”)
Tax registration is mandatory for all companies doing business in Nigeria. In practice, upon incorporation with CAC, a Tax Identification Number (TIN) is assigned to a company. Nonetheless, a company is required to register with FIRS for tax purposes.
The requirements for FIRS’ registration are as follows:
- Application letter using the company’s letterhead
- Incorporation documents
- Particulars of the company directors
- Utility Bill
2.2 Registration with Special Control Unit Against Money Laundering (“SCUML”)
Special Control Unit Against Money Laundering (SCUML) is a unit of the Economic and Financial Crimes Commission (EFCC) that is saddled with the responsibility of supervising, monitoring and regulating Designated Non-Financial Institutions (DNFI) as regards compliance with Nigeria’s Anti Money Laundering law.
A real estate company is DNFI in Nigeria and therefore must register with SCUML before commencing operations and report suspicious and other high volume transactions to the SCUML in accordance with the law.
The following documents are required for registration:
- Incorporation documents
- Tax Identification Number
- BVN, Bank Name and Account Number
- Real Estate Developers Association of Nigeria (REDAN) Membership certificate
2.3. Registration with Real Estate Developers Association of Nigeria (REDAN)
REDAN is the principal agency and umbrella body of the organized private sector (public and private) responsible for housing development in Nigeria. It is the first port of call for government, private establishments, international partners and investors who wish to participate in housing development in Nigeria.
The requirements for registration are as follows:
- Duly completed application form
- Written application on company letterhead paper
- CAC incorporation documents
- Audited accounts
- Company Profile including organization structure showing the positions of directors, key personnel, their qualifications and functions.
- Project brochures
- Bank reference/Letter of introduction
- Bank cheque for registration and subscription fees.
- Tax Clearance Certificate
- Evidence of National Housing Fund contribution (in compliance with the National Housing Fund Act and National Housing Policy)
- Photo Identification of Major Shareholders and Directors
- Execution of REDAN Membership Code of Conduct form
Please note that registration with REDAN is a precondition for registering with the SCUML.
The applicable costs for REDAN registration of a real estate company are as follows:
Application fee ——– N10,000
Registration fee ——- N100,000
Development fee —— N140,000
Annual Subscription —- N100,000
2.4. Registration with Lagos State Real Estate Regulatory Agency (LASRERA)
The Lagos State Estate Agency Regulatory Law, Cap L28, Laws of Lagos State, 2015 (“Law”) established the LASRERA. This Agency is saddled with the responsibility of regulating real estate businesses in Nigeria through the issuance of permits, registration and monitoring of the affairs of all real estate transactions and practitioners in Lagos State. One of the LASRERA’s core missions is to protect the public from fraudulent and unscrupulous practices in the real estate sector and ensure public safety through effective monitoring of the quality of real estate development projects.
The requirements for registration are as follows:
- Duly completed application form
- CAC Incorporation documents
- Means of Identification of directors of the company
- Operational Office Address
- Evidence of payment of fees
The cost for the various licence categories is stated in the table below
| S/N | LICENCE CATEGORY | ESTIMATED COST(N) | VALIDITY |
| 1. | Housing Estate Developer | 1,005,000 | 1 year |
| 2. | Property Developer | 255,000 | 1 year |
| 3. | Real Estate Agency (for solo real estate agents) | 105,000 | 1 year |
| 4. | Real Estate Broker (operational office is not a compulsory requirement) | 55,000 | 1 year |
| 5. | Real Estate Developer | 1,005,000 | 1 year |
| 6. | Real Estate Marketer | 50,000 | 1 year |
2.5. Registration with Nigerian Institution of Estate Surveyors and Valuers (NIESV)
Where the business of the real estate company will involve survey and valuation services, then the company must register with the Nigerian Institution of Estate Surveyors and Valuers (NIESV). The NIESV is a non-profit, voluntary, professional organization that caters for the interest of professionals involved in land transactions.
The requirements for registration are as follows:
- Duly completed registration form
- Evidence of payment of processing fee
- Letter of resignation and letter of acceptance from previous employer
- Certificate of compliance from Estate Surveyors and Valuers Registration Board of Nigeria
- Certificate of business registration from Corporate Affairs Commission to read “real estate surveying & valuation only”
- Up to date payment of NIESV dues and pledges
- Two recent passport photographs of the directors of the company
- Certificate of professional indemnity – minimum of N1 million cover
- Evidence of client dedicated account
- Evidence of account opening with the business name
- Recent phone numbers of directors of the company
The applicable costs for registering with NIESV are as follows:
Registration form – N10,000
Processing fee – N25,000
2.6 Registration with Association of Estate Agents in Nigeria (AEAN)
Where the business revolves around agency business in the real estate sector, then the company must register with the Association of Estate Agents. This Association is an affiliate of the Nigerian Institution of Estate Surveyors and Valuers. It was established with the aim to regularize the practice of estate agencies in Nigeria. The Association offers training, regulation, monitoring and discipline of members.
The requirements for registration are as follows:
- Incorporation documents
- Application for membership on the company’s letter head
- One passport photograph of each of the Directors
- Candidates/Directors are expected to partake in Mandatory Compulsory Professional Development (MCPD) Courses within one month of submitting application. Refresher Courses are also organized every year to renew Membership
The applicable costs for registering with the Association of Estate Agents are as follows:
Application Fee – N5000
Acceptance Fee – N10,000
Annual subscription fee – N10,000
3. What is the timeline for processing incorporation and post – incorporation registrations for a real estate company in Nigeria?
In Nigeria, incorporation of a company can be completed in 24 hours.
The estimated timeline for the post-incorporation registrations of a Real Estate Company is 6 – 8 weeks.
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About KORIAT & CO.
We are a commercial law firm in Nigeria with network of lawyers and consultants in Ghana, Kenya and Rwanda. The above article is not legal advice and does not automatically make our readers our clients unless they specifically instruct us to act or represent them in any way.
We assist local and foreign clients to process company registration and business licences in Nigeria, Ghana, Kenya and Rwanda.
Please contact Koriat & Co. through admin@koriatlaw.com or 09067842241 if you require additional information about or assistance in registering a company or processing application for a business licence in Nigeria, Ghana, Kenya and Rwanda.
