Purple Capital Partners, a Nigerian investment firm specialising in real estate and financial services, is planing to raise $50m in 2016 for two parallel funds focused on retail properties or mixed use properties involving retail, in the Lagos urban area.

Laide Agboola, Managing Partner at Purple Capital Partners, said that the firm was incorporated in 2013 and since then has made investments of $60m.

"In the first few months of 2015, we focused on our Lagos-registered fund dedicated to domestic investors, but we are now beginning to market more proactively to foreign investors through a fund domiciled in Mauritius," he said in an interview with the African Private Equity and Venture Capital Association (AVCA).

"We will also provide opportunities for institutions that want to co-invest with us outside a private equity fund structure," he said.

Agboola said that when it comes to Nigerian retail property there is a substantial gap between current capacity and potential demand.

"We anticipate that it will take the next 20 or 30 years to narrow the variance, so we will continue to focus our efforts on this particular sector," he said.

"Looking more broadly at Nigeria as a whole, it makes up more than half of West Africa’s economy, and has the continent’s largest GDP. Taking this into account, we do not feel the need to look beyond Nigeria for now, but we do see opportunities in other national sectors, such as infrastructure. Agriculture could also generate strong returns, through investment in upskilling and mechanisation," he said.

The company focuses on development/growth opportunities and has equitable board/project involvement.

Strong emphasis is placed on proper corporate governance and best practice.

Purple Capital co-invests with its long term partners including family offices, HNIs and institutional clients.

The company focuses on small to mid sized opportunities, optimal operational expense, profitability, multiple exit options and appropriate timing for all investing stakeholders.

According to Agboola, origination is one of the more challenging things about real estate investment in Nigeria.

"You have to be sure you’re getting it right in your relations with landowners and the government. It is significantly harder to do that if you are not an experienced player at the local level," he said.

Agboola added that many international investors in retail real estate concentrate on Lagos Island, but Purple Capital is taking the unconventional approach by focusing on the more urbanised Lagos mainland.

"This is ultimately more challenging given that large pieces of land, on the scale of those required for malls, are harder to obtain," he said.