Following allegations of contractual impropriety against Afrilands Properties in the transaction to redesign and redevelop Falomo Shopping Centre in Lagos, the firm yesterday refuted the allegation stating that it paid a N50million Expression of Interest fee ahead of the eventual award of the contract.
The media was rife with reports yesterday implying that the contract with the Lagos State Development and Property Corporation, LSDPC, was terminated on the grounds that the concession terms were “grossly detrimental” to Lagos State and its residents.
The reports also claimed that Afriland Properties Plc only made a payment of N50 million for a 50-year lease of the government-owned land.
But in a statement signed by its managing director, Uzo Oshogwe last night, the firm stated that though the authenticity of the reports was unconfirmed, Afriland never engaged in any misconduct and that neither was the transaction in any way detrimental to the people and government of Lagos State.
“We are strongly committed to creating a world class project, which will act as an economic magnet for central Lagos, creating opportunities for Lagosians and which crucially has been structured to ensure ongoing value will accrue to Lagos State and to Lagosians. The contract was negotiated transparently and in accordance with best practice,” the firm stated.
It continued: “Afriland Properties PLC and the Lagos State Development Property Corporation, LSDPC, acting on behalf of the Lagos State government, established a Special Purpose Vehicle, SPV, which is jointly owned by the parties for the specific purpose of developing the Falomo project.
“Under the terms of the agreement, the SPV- Falomo Shopping Centre Development Company Ltd – was granted a concession to, amongst other things, develop, build, operate and maintain the project on a Build, Operate and Transfer, BOT, basis.
“Afriland paid N50million to LSDPC as an expression of interest in the redevelopment project. The LSPDC will receive a 35 percent interest in the SPV for its land contribution and through this significant equity holding, will continue to receive significant ongoing value
“Afriland is obliged to fund the entirety of the development costs which is projected to exceed N30 billion without recourse to the Nigerian taxpayer. The new facility will comprise a state-of-the-art shopping mall, office complex and generous parking facilities.”
The company added that it had consistently adhered to the terms of its agreement with LSDPC as outlined in the Memorandum of Understanding, MoU, and Joint Venture Agreement that were signed and executed by the aforementioned parties, saying that “all value to be derived from the creation of this world-class commercial venture will be held in, and enjoyed by Lagos State and its residents. The development will ultimately revert to the state upon expiration of the lease.
“Apart from delivering an environment that befits the city and is consistent with the government’s goal of an aesthetically pleasing skyline, the Falomo site will be home to thriving businesses that will contribute significantly to the Internally Generated Revenue, IGR, of the state.”

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