By Ayo Royce
Nigeria’s real estate sector has witnessed significant growth in recent years, emerging as a vital contributor to the country’s GDP—at times even surpassing oil. This expansion is largely driven by increased demand for residential properties and growing investor interest.
However, the sector is currently grappling with serious challenges, particularly in Lagos, where rising reports of land disputes, contract defaults, and weak regulatory enforcement threaten to derail its momentum.
One major concern is the growing incidence of land-related conflicts and allegations of fraudulent transactions. Several investors claim to have lost large sums in controversial property deals, while others say they have been forced to suspend or scale down operations. Despite increased awareness, unsuspecting buyers continue to fall into difficult situations involving disputed ownerships or encumbered properties.
These issues have overwhelmed the state’s courts, creating backlogs and complicating the work of genuine developers. Though the Lagos Judiciary has made notable efforts to tackle these disputes, analysts and stakeholders argue that more robust safeguards are needed to prevent innocent buyers from being drawn into complicated litigation stemming from unclear land titles.
Experts stress that buyers must also perform proper due diligence before entering property transactions. The age-old legal principle of caveat emptor—buyer beware—remains as vital as ever in a landscape increasingly marked by uncertainty.
While previously rare, disputes over land ownership, double allocations, and allegations of impersonation have become common. In some instances, parties are accused of selling the same parcel of land multiple times or entering joint venture (JV) agreements without full authority.
A notable example is the ongoing legal dispute between Helli-Ellis Planets Limited and Oretol Nigeria Limited, over a 10-hectare property in NICON Town Estate, Osapa, Lekki, Lagos. Helli-Ellis claims that despite a registered Deed of Sublease and the appointment of a new generation bank as trustee, its partner Oretol entered into third-party transactions on the land without proper authorization.These deals, it argues, could expose buyers to legal uncertainty if the courts eventually rule against the transactions.
Oretol, on its part, is said to have maintained that its actions are in line with its understanding of the project terms. But Helli-Ellis has expressed concern that what was agreed as a transparent joint venture is now mired in disputes over land sales and project integrity.
At the heart of the matter is the claim that the trustee, a new generation bank, may have prematurely released the title documents—originally meant to be held until the completion of the project. Observers say if this is proven, it would raise red flags about the enforcement of trust responsibilities in real estate financing and escrow management.
According to the parties’ Property Development Agreement, Helli-Ellis was to contribute land valued at N4.5 billion, while Oretol would inject N11.04 billion in construction and infrastructure. The final development was to be shared accordingly. However, Helli-Ellis alleges that the other party defaulted, sold plots to unknown third parties, and diverted proceeds from those transactions—actions it argues could amount to a fundamental breach of contract.
Third-party purchasers who have begun development on these lands now risk becoming entangled in ongoing litigation. This scenario underscores the urgent need to reform Nigeria’s Alternative Dispute Resolution (ADR) mechanisms, particularly for land-related cases, which often drag on for years.
According to Helli-Ellis, about 45 plots and an additional 4 hectares were sold by Oretol to various entities, including Capital Gardens Ltd. and Capital Homes Ltd., without prior consent. If true, this could leave many buyers caught in a legal web over title legitimacy. The ripple effect includes uncertainty in the land registry, possible funding hesitations from banks, and a weakened investor climate.
Regulatory bodies such as the Lagos State Real Estate Regulatory Authority (LASRERA) and the Real Estate Developers Association of Nigeria (REDAN) are now under pressure to strengthen oversight of joint ventures and enforce clearer frameworks around land transactions. Developers say existing systems for vetting ownership and verifying JV agreements are insufficient.
Originally, the project in dispute was to comprise 96 flats, 23 detached houses, and 35 terrace homes—backed by integrated infrastructure. But the vision appears to have been fragmented. Developers reportedly working with Oretol are said to have constructed units that deviate from the master plan, leading to concerns over poor planning, congestion, and potential infrastructure failures in the rapidly developing Lekki corridor.
Such deviations reduce the market value of adjacent properties and contribute to urban disorder. Without cohesive oversight, Lagos’s broader urban planning ambitions could suffer significant setbacks.
To restore trust and stability, stakeholders argue that enforceable penalties must be introduced against developers who breach JV terms or misrepresent ownership. There is also a growing call for a statutory system to authenticate JV agreements, supported by a centralized registry that reflects the ownership status and development stages of joint projects. In addition, stronger legal safeguards should be applied to prevent the unauthorized release of title documents by trustees, whose fiduciary obligations must be clearly defined and enforced.
Efforts to streamline the resolution of land-related disputes—particularly through well-funded arbitration and improved enforcement of arbitral awards—are equally vital. Without these reforms, the industry will likely remain vulnerable to contract breakdowns and investor distrust.
In a related case, Dreams Court Limited, reportedly affiliated with Capital Gardens, issued a public notice cautioning against transactions on a parcel of land in Hampton Estate, Osapa, Lagos. The company claimed the land was already acquired by it and that further sales or development by other parties were without its consent. Such recurring disputes continue to muddy the waters for investors and developers alike.
Ultimately, the future of Nigeria’s property sector depends on credible land governance, enforceable contract frameworks, and proactive regulation. Without these foundational elements, the sector could spiral into deeper dysfunction, chasing away investment, eroding confidence, and slowing economic growth.
*Royce, a property expert, writes from Lekki, Lagos
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Nigeria’s real estate sector has seen substantial growth recently, becoming a key contributor to the country’s GDP. The growth is driven by a rising demand for residential properties and increased investor interest. However, the sector is facing challenges, especially in Lagos, where issues like land disputes, contract defaults, and weak regulatory enforcement are threatening its progress.
Reports of land-related conflicts and fraudulent transactions are on the rise, with investors losing money in questionable property deals. The Lagos Judiciary is trying to address these disputes, but more robust measures are needed to protect unsuspecting buyers. It’s crucial for buyers to conduct thorough due diligence before entering into property transactions to avoid potential legal entanglements.
Instances of land ownership disputes, double allocations, and unauthorized transactions are becoming more common, leading to legal battles like the one between Helli-Ellis Planets Limited and Oretol Nigeria Limited. The real estate sector requires improved regulation, enforceable penalties for contract breaches, and a more transparent framework for land transactions to ensure stability and prevent further setbacks.
Original Source: Vanguard News