Investment company, Sankore, has expanded its business portfolio with a focus on Real Estate and Agriculture. These investment products were created to financially support the capital needs of growth companies in the Real Estate business and Agric market in Nigeria.
During an Investor Gathering, which was covered by Nairametrics, Sankore Investment’s Chief Executive Officer, Titi Odunfa Adeoye said there’s a growing demand for some Agricultural produce by the end product manufacturers, due to its profitability.
[READ ALSO: Three quick ways to find out if a stock is overvalued]
Adeoye also stated that there’s shortage of supply, compared to the demand for specific Real Estates in Nigeria. According to her, Sankore believes investors can take advantage of the rising demand for affordable, yet profitable property development within the country.
Speaking about how the company arrived at the two sectors as being best for creditors to invest in, Adeoye said Sankore understands there’s “a need to offer clients a broad range of assets. And looking at Nigeria at the time (2010), we have already spent some time to think through where the investment opportunities will be.
“And at the time, we thought the best way to think of where to invest should come from where the problems are. What are the problems Nigeria has and how do we solve them?
“So, even as far back as 2010-2011, we were kind of focused, trying to identify these places, and at that time, we came out with the idea that we need to look much more deeper into two specific sectors, and those two are Agriculture and Real Estate.
“We also found there were few other areas to look at, and those are technology and education. These four areas are the key problems we think we need to solve in Nigeria.
“And for us, we are strong believers in the transformative ability of well-deployed investment. And for us, that’s one of the things that drive us. We really believe that investment can grow our country, investors can change us.”
[READ MORE: Debt servicing gulps N7.04 trillion under President Buhari’s administration]
Focus of Real Wealth Fund: Adeoye said, considering the need and demand in society, the company’s focus for now is streamlined to the following Real Estate.
- Student/Professional housing
- Commerce
According to her, majority of Investment Funds are diverted into luxury apartments and hotels, and that investment direction needs to change due to the poor return on investment from the luxury apartments experienced by High Networth Investors. She said HNIs could instead invest in Student Housing because it has higher yields and demands are high.
[READ FURTHER: Flying Doctors’ Founder, Ola Brown, discusses Challenges facing Nigeria’s Healthcare Industry]
Investment for the student and professional housing will be in some areas of Lagos, with Yaba in focus.
Focus of Sankore Agricultural Fund: The crops that the company intends to disburse interested investors’ funds on are:
- sorghum;
- soya; and
- maize.
What drives choice of crops: It was explained that these crops were selected because they are easy, liquid, and the cashflow can be monitored end-to-end very easily. Also, the crops are industrial crops with the big buyers.
Nairametrics learnt that in addition to Real Estate, the other sector that was thought to be extremely important to the country’s growth, was Agriculture. Agriculture was selected because of its impact on job creation and the fact that Nigeria still imports majority of the things that are consumed in the country. Sankore is therefore certain that investors can get the worth of their investments if disbursed into these crops business.
[READ THIS: 46-years after, Mr. Bigg’s is not so big anymore]
Adeoye explained that Sankore had to partner with 5th Harvest some years back to understand the agric market and the extent of exposure needed because investors are always jittery about investing in agric business.
To ensure sales, partners like Afex Commodity Exchange, an agric business in Nigeria, has a binding agreement with end product manufacturers like beverage companies for the supply of these agricultural produce.
To derive value from investment for investors and derisk investment, Sankore has partnership with companies that are Real Estate-dependent and are deep into the agric business. Some of the companies are Shoprite and Afex Commodity Exchange.