The Situation
An investment group was acquiring ₦500,000,000 of land at a rate per square metre well below the surrounding corridor. The seller attributed the discount to the area still developing and to his own need for liquidity.
We ran two checks that the pricing narrative did not cover.
- Soil testing established that the ground could not carry development without reclamation, and the cost of that work is a function of the parcel size rather than a fixed sum.
- Charting at the Office of the Surveyor-General placed part of the holding on a drainage channel alignment, which is not developable and not compensable.
A discount is information, and the question it raises is what the seller knows that the price is compensating for. On land, the answer is frequently a physical constraint that no title search will surface, because the parcel can be perfectly clean on paper and still be unbuildable.