Commercial Property Management Agreement (Nigeria)

A Commercial Property Management Agreement in Nigeria sets out the rights, duties and consideration binding the parties to it.

Commercial property management in Nigeria operates under the Estate Surveyors and Valuers (Registration, etc.) Act, Cap E13, Laws of the Federation of Nigeria 2004, administered by the Estate Surveyors and Valuers Registration Board of Nigeria (ESVARBON) and the Nigerian Institution of Estate Surveyors and Valuers (NIESV). The NIESV Standards of Professional Practice and the NIESV Scale of Professional Fees govern the conduct and remuneration of commercial property managers.

Commercial leases in Nigeria are typically governed by the Conveyancing Act 1881 (applicable in southern states) or the relevant state property law, with tenancies exceeding three years required to be executed as deeds under the Land Use Act 1978 and Section 22 requiring governor's consent for alienation. The Lagos State Commercial Tenancy Law and the Recovery of Premises Act (applicable in northern states and the FCT) govern the relationship between commercial landlords and tenants, including notice procedures and recovery of possession.

Commercial property management in Nigeria differs significantly from residential management in scale and complexity. Large commercial properties — such as the multiple Grade A office towers on Adeola Odeku Street and Sanusi Fafunwa Street in Victoria Island, Lagos, or the major shopping centres in Ikeja and Lekki — require structured service charge regimes, preventive maintenance programmes, engineering management, and tenant interface protocols that are set out in a thorough management agreement.

The Value Added Tax Act 2004 (as amended by the Finance Act 2020) imposes VAT at 7.5% on professional management fees, which must be separately stated and invoiced in the management agreement. The Federal Inland Revenue Service (FIRS) requires ESVARBON-registered firms to register for VAT and remit monthly returns.

The legal framework governing the Commercial Property Management Agreement (Nigeria) in Nigeria draws on several key statutes and regulatory bodies. Under Nigerian law, the Companies and Allied Matters Act 2020 (CAMA) regulates corporate entities through the Corporate Affairs Commission (CAC). The Labour Act (Cap L1 LFN 2004) and the National Industrial Court of Nigeria (NICN) govern employment disputes. The Nigeria Data Protection Regulation (NDPR) 2019 and the Nigeria Data Protection Commission (NDPC) protect personal data. The Federal Inland Revenue Service (FIRS) administers tax obligations under the Companies Income Tax Act. The Federal High Court and state High Courts have jurisdiction over civil matters. Parties executing a Commercial Property Management Agreement (Nigeria) in Nigeria should confirm the document reflects current law, including any amendments enacted since the original drafting date. The Land Use Act 1978 (Cap. L5, LFN 2004) sets the foundational requirements.

A Commercial Property Management Agreement in Nigeria is required whenever an owner of commercial real estate needs professional management services and seeks to formalise the scope of authority, reporting, and fee arrangements with an ESVARBON-registered manager.

A Commercial Property Management Agreement is required when an institutional investor — such as a real estate investment trust (REIT) regulated by the Securities and Exchange Commission (SEC) under the Investment and Securities Act 2007 — appoints a property manager for office, retail, or industrial assets forming part of the REIT's portfolio. The SEC Rules on REITs require that fund assets be professionally managed.

A Commercial Property Management Agreement is needed when a multinational corporation establishing a Nigerian subsidiary leases an office building and requires facilities management services — cleaning, security, HVAC maintenance, and lift servicing — coordinated by a single property manager under a unified service charge regime.

A Commercial Property Management Agreement is required when a developer completes a commercial building and transitions from development management to operational management, appointing an ESVARBON-registered firm to manage the building, administer service charges to tenants, and coordinate statutory inspections under the relevant Lagos State Building Regulations or FCT Building Control Regulations.

A Commercial Property Management Agreement is needed when a bank or financial institution, regulated by the Central Bank of Nigeria (CBN), takes possession of a commercial property following enforcement of a mortgage and requires an independent manager to maintain, let, and manage the property pending sale.

A Commercial Property Management Agreement is required when a property syndicate or special purpose vehicle (SPV) incorporated under the Companies and Allied Matters Act 2020 (CAMA 2020) acquires commercial property and requires a professional manager to report to the SPV's board on financial performance, lease administration, and capital expenditure.

Parties in Nigeria should prepare a Commercial Property Management Agreement (Nigeria) proactively rather than waiting for a dispute to arise. Courts interpret agreements based on the written terms rather than oral representations. Under Nigerian law, the Companies and Allied Matters Act 2020 (CAMA) regulates corporate entities through the Corporate Affairs Commission (CAC). The Labour Act (Cap L1 LFN 2004) and the National Industrial Court of Nigeria (NICN) govern employment disputes. The Nigeria Data Protection Regulation (NDPR) 2019 and the Nigeria Data Protection Commission (NDPC) protect personal data. The Federal Inland Revenue Service (FIRS) administers tax obligations under the Companies Income Tax Act. The Federal High Court and state High Courts have jurisdiction over civil matters. Where the transaction involves regulated activities, prior approval from the relevant authority may be required before execution.

A valid Commercial Property Management Agreement in Nigeria must contain the following essential elements.

Parties and Professional Credentials: Full legal names, addresses, and descriptions of the property owner and the management firm, with the firm's ESVARBON registration number, NIESV membership status, and VAT registration number with the Federal Inland Revenue Service (FIRS). The agreement should identify the named partner or director of the firm responsible for the management account.

Property Schedule: A full description of the property including address, plot number, survey plan reference, Certificate of Occupancy (C of O) or deed reference, gross internal area (GIA) in square metres, number and type of lettable units, current tenancy schedule (tenant names, lease terms, rent payable, review dates), and common areas under management.

Scope of Management Services: A thorough service schedule covering: (a) lease administration, including rent collection, rent review negotiations, lease renewals and surrenders; (b) tenant liaison and breach management; (c) service charge administration, including annual service charge budgeting, collection, reconciliation, and RICS (Royal Institution of Chartered Surveyors) or NIESV best practice compliance; (d) facilities and preventive maintenance management; (e) statutory compliance including fire safety certificates, NAFDAC premises registration (for food or pharmaceutical tenants), and insurance renewals under NAICOM-licensed insurers.

Management Fee Structure: The agreed fee expressed as a percentage of annual gross rent collected (typically 5–8% for commercial under the NIESV Scale), plus VAT at 7.5% under the Value Added Tax Act 2004. Additional fees for rent review negotiations, lease renewals, or tenant procurement should be separately scheduled.

Service Charge Regime: The framework for setting, collecting, and reconciling service charges from tenants, including the service charge year, the basis of apportionment between tenants, the landlord's contribution to voids, and the dispute resolution mechanism for tenant service charge challenges.

Expenditure Approval and Capital Works: Delegated authority thresholds for routine maintenance, and the procedure for owner approval of capital expenditure items above the threshold, with requirements for competitive tendering above specified NGN values.

Reporting Obligations: Frequency of financial reporting (monthly management accounts, quarterly performance reports, and annual income and expenditure accounts), property inspection reports, and tenant covenant health checks, with agreed formats aligned to NIESV professional practice.

Additional compliance elements for a Commercial Property Management Agreement (Nigeria) used in Nigeria include: Under Nigerian law, the Companies and Allied Matters Act 2020 (CAMA) regulates corporate entities through the Corporate Affairs Commission (CAC). The Labour Act (Cap L1 LFN 2004) and the National Industrial Court of Nigeria (NICN) govern employment disputes. The Nigeria Data Protection Regulation (NDPR) 2019 and the Nigeria Data Protection Commission (NDPC) protect personal data. The Federal Inland Revenue Service (FIRS) administers tax obligations under the Companies Income Tax Act. The Federal High Court and state High Courts have jurisdiction over civil matters. Forms-legal.com provides this template as a starting point for Nigeria-compliant documentation.