With rental rates that have almost doubled this past year, some major locations in the heart of Lagos may, according to estate surveyors, be gradually assuming reputation as hubs for commercial activities in the entire city, if recent developments are anything to go by.
Real estate professionals and town planners, who examined investment activities in the areas in an independent survey last week, believe that given the rate at which rents have been appreciating in the past year, the areas are gaining popularity from their upgrades in terms of rental appreciation.
In these locations, residential and office buildings have been converted to accommodate evolving commercial outlets, while some are purpose built. Most times, these buildings have been remodeled without recourse to town planning regulations such as parking space, leading to traffic bottlenecks in major roads.
According to estate surveyors, there has been a surge of commercial activities in locations such as Oshodi, Ikeja, Surulere, Abule-Egba, Ikoyi, Agege, Victoria Island, Ojodu-berger and Ajao Estate. Popular fast food outlets like Tantalizers, Tastee Fried Chicken, FoodCo, So Fresh, Bukka Hut, McDonalds, Chicken republic, Sweet sensation, and Mr. Biggs, Dominoes, The Place and KFC restaurants drive the new activities.
Specifically, the retail-led developments such as fast foods/restaurants and other mobile outlets are leading the wave of urban regeneration in Lagos metropolis and improving quality of life in communities.
There are also evolving business concerns, which are mostly service providers and new generation of computer, IT hardware and software companies, fashion and clothing firms as well as mobile phone outlets such as 3C Hub, Slot, Micro Station and XRight. There are smaller snack kiosks that dot several spots and joints as well as stand-alone booth structures, which command high footfalls.
Estate surveyors say, the Admiralty way in Lekki Phase 1, has become commercial-retail hub, while property values in that axis has appreciated by 300 per cent. Land that was previously sold for N100, 000 per square metres has risen to almost N400, 000 per square metres.
In other locations such as Opebi, Allen, Toyin, Awolowo way, Oba Akran and Oregun streets in Ikeja, office space earlier rented out five years ago for N15, 000 per square metres, now commands rent of N30, 000/N35, 000 per square metre, while other highbrow areas are as high as N80, 000 per square metre.
Some other property prices range from N45, 000 per square metres to N50, 000 per square metre, depending on grade of the property. For instance, along the Awolowo road in Ikeja, specifically, Awolowo House, offices earlier rented out at 8,000 per square metres, now goes for N35, 000 per square metre.
Retail activities in the city have also metamorphosed into close relationships and are often used to underpin regeneration schemes providing a catalyst for the wider physical and urban development. The outlets have become an important element, contributing to socio-economic development by providing jobs, services and investments.
According to The Guardian’s survey, the youths, families and young professionals are regarded as constant visitors to these outlets carrying out one transaction or the other.
The President, Association of Town Planning Consultants of Nigeria (ATOPCON), Muyiwa Adelu, said the growth is due to the increasing population and commercial instinct of people in a city like Lagos as well as the reality that the economy is better than anywhere else in the country. This, he said is encouraging people to patronise such outlets.
However, he called for adequate planning, adding that ideas for the structures must align with dictates of the master plan and what is better for the people.
According to him, the outlets have been a menace because people site them indiscriminately until recently when successive government repackaged them for better siting.
He said: “There is need to ensure that the authorities accommodate and plan with the owners in siting the facilities. As city planners, our association frowns at indiscriminate siting of the facilities.
“If our city must be well planned, it means all operations must be well too. We need to encourage our entrepreneurs to comply with the rules and regulations.The government needs to wake up by controlling and monitoring our development through the use of its agencies for effective regeneration of Lagos city and the metropolitan areas.”
Adelu explained that due to high demand and short supply, the property value for the locations of the outlets would continue to increase.
“Unfortunately, if they have to comply with our regulations, government has to restrict them to commercial areas, which means that property in commercial areas will also be high.
“As it is now, what is in operation is that people site such facility anywhere, parties agree on the value and the property springs up.”
The immediate past chairman, Nigerian Institution of Estate Surveyors and Valuers, Adedotun Bamigbola, who confirmed the development said it also involves grocery stores and supermarkets both local and foreign brands springing up in various locations.
“Fast food, grocery stores, telecommunication stores or phone stores have been the bedrock of what you find in malls, leading to wave of destination and neighborhoods malls in Lagos, Abuja and major city centres. With our huge population, basic things we actually use are food, telephones and groceries. We have over 100 million phone lines in Nigeria. That is what is leading regeneration into commercial retail and office developments. ”
Another estate surveyor, Richard Olodu, said it was as result of retail outlets spring up in lkeja that turn around major location like Computer village from residential to commercial zone and the visibility of notable fast food outlets on Kodesho Street, such as Aviation Plaza.
He said: “Before Anifowoshe Street was basically residential area but today it has become a commercial hub with major developments. Beside lkeja city mall, properties that were hitherto residential have been turned into commercial use.
“Before rent for two-bedroom flat around lkeja was N360, 000 per year, it moved to N700, 000 and today, you could hardly find one for N1. 5 million. If it is new, it is about N2.5 million. This is as a result of spill over from Computer Village. Before, in Anifowoshe Street, you could find rooms in a bungalow for 1,000 per month but today such houses have been phased out. If government succeed in moving Computer Village to the new location, it will also impact heavily on the rent in that area.”
The immediate past vice chairman, Nigerian Institute of Town Planners (NITP), Lookman Oshodi said in urban food supply system, food distribution outlets play a major role in ensuring that urban food is kept alive to sustain urban population.
He stated that urban regeneration is an all-encompassing system that looks not only at physical development, but the economic revitalisation of any community, contributing to job and revenue generation for different state’s agencies.
According to him, the fast food outlets have led to gentrification in urban regeneration, which increases rental value of some property within the area.
He explained: “The property value in a place whereby people are paying N5, 000 per year, because of the influence of food distribution outlets, the landlords may decide to raise the rent to N35, 000 per year and this may displace those living there.
“When we look at regeneration, we consider the blighted communities, whether the mobile outlets are increasing or decreasing in those areas. The rates at which mobile outlets are coming up are beginning to become a contradiction between many community groups and where they are located.
“Some community members feel that the vendors and the vulcanisers who use mobile outlets in different locations and in some places at the entrance of certain community are becoming environmental nuisance to peace and tranquility of the area. In terms of urban regeneration, they may not really produce a positive effect, if they are not considered necessary by the people.”