Basic Terms of Relationship

 

Group-photograph-of-stake-holders-after-signing-of-the-land-swap-Mou-in-Abuja-

Group-photograph-of-stake-holders-after-signing-of-the-land-swap-Mou-in-Abuja-

To ensure that its objectives in the land swap policy are realised and also guarantee investors’ confidence and buy-in, the FCTA through the Abuja Infrastructure Investment Centre, AIIC, set out 11 strict guidelines for participation in the policy. These guidelines ensure that all apprehension about bureaucracy by the investors are taken care of to guarantee the execution of the projects.

  1. Each developer pays an initial commitment fee of N350 million on presentation of the business plan. This would fund the preliminary design, survey plan, feasibility studies, engineering design and preparation of agreement.
  2. The developer must also procure the detailed design and provide the infrastructure in the district within a maximum period of 48 months.
  3. The detailed design of the district must adhere to the guidelines of the Department of Urban and Regional Planning of FCTA.
  4. The execution of the works shall be in strict compliance with the Federal Capital Development Authority, FCDA, specifications and standards for district infrastructure works.
  5. The developer shall not commence real property development or sale of any land in the district until it achieves at least 35 per cent of functional infrastructure works;
  6. The release of land titles to the developer is phased to ensure the achievement of appropriate milestones in three phases: 15 per cent of the rights of occupancy shall be released to the developer on evidence of transfer of 15 per cent of the infrastructure cost to project account; 80 per cent of rights of occupancy shall be released on the basis of interim measure certificates, the minimum value of which shall not be less than 20 per cent of infrastructure works; five per cent shall be retained till after the retention period of 12 months. The rights of occupancy are to be warehoused in a bank mutually agreed by the parties.
  7. The structure of the total project cost consists of seven well thought out sub-heads: construction cost; financing cost; professional fees; resident supervision cost; 12 months operating cost; resettlement and compensation cost; and return on investment.
  8. The funding structure of the project is broken down into three acceptable ratios: debt 50 per cent; equity 15 per cent; and off-plan sales 35 per cent.
  9. The developer provides an acceptable performance bond from a reputable bank or insurance company
  10. Federal Capital Territory retains not more than 40 per cent of the buildable plots in the district.
  11. The Federal Capital Development Authority appoints a consultant to ensure that the execution of the works is done in accordance with its specifications; the consultancy fee is factored in to the total project cost.

In addition, the following documents were provided by the FCTA:

  1. Instruction to the investors.
  2. Framework for the land swap.
  3. The designated district map and other relevant maps.
  4. Technical and financial proposal requirement.
  5. FCTA guidelines for physical plan preparation.
  6. FCDA general specifications for roads, bridges and drainages.
  7. FCDA general specifications for electrical works.
  8. FCDA general specifications for water and sewage network; and
  9. FCDA general specifications for telecommunication works.
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