…Facelift triggers off rise in property values
By Jude Njoku
LAGOS Island Business District was unarguably the toast of property investors and blue chip companies prior to the relocation of the seat of the Federal Government to Abuja in 1991. The movement to Abuja coupled with the dilapidation of existing infrastructure in the Island, led to a mass relocation of many business outfits to more conducive neighbourhoods of Victoria Island and Ikoyi.
The glut of vacant office spaces prompted the Association of Building Owners in Lagos Island, ABOLI, to cry out to the Lagos State government to carry out a comprehensive urban renewal of the Island. ABOLI which metamorphosed into the Lagos Island Millennium Group on the Environment LIMGE, continued with the regeneration struggle until the Lagos State government and the World Bank embarked upon a comprehensive rewewal of the Island.
The ubiquitous miscreants popularly called “Area Boys or Alayes” were also dislodged to a large extent from the Island while street trading was reduced drastically.
The good news is that the CBD is again bubbling with life. The neighbourhood which houses the tallest buildings in Lagos, has once again become the toast of property investors and corporate organisations as it was in the late 1980’s and early 1990’s.
Redevelopment and beautification
Vanguard Homes & Property learnt that the redevelopment and beautification of the outer Marina, the surge in rental value of purpose built offices in Victoria Island and Ikoyi and the traffic bottlenecks in Victoria Island, have compelled some of the companies and banks to relocate their offices to the burstling Lagos Island CBD.
The glut in vacant office accommodation which was in vogue prior to the regeneration has given away to shortage of supply of such accommodation. Infact, occupants of the Great Nigeria House which was gutted by fire late last year, could not find vacant spaces in the CBD to continue their businesses.
The Chairman of the Lagos State branch of the Nigerian Institution of Estate Surveyors and Valuers, NIESV, Pastor Stephen Jagun confirmed the development in a chat with Vanguard Homes & Environment.
He explained that the surge in the rental value of commercial properties in Ikoyi and VI coupled with the facelift given to Lagos Island CBD gave rise to the present high demand for commercial properties in the island. He noted that housing supply in Lagos Island CBD is static while demand is going up. “There are virtually no new developments going on in Lagos Island apart from a few refurbishments.
The whole area is jam packed The vacancy rate is very low because of the attraction from VI. Purpose built houses in Victoria Island are very costly; a tenant may be paying between 10 -15 million naira as rent per annum on such purpose built buildings. When you add the cost of running generators and hiring a private security outfit, you find out that it becomes cheaper for you to rent a wing in a highrise building and share the services with other tenants,” he said.
Continuing, Pastor Jagun said a square metre of office space in VI and Ikoyi goes for between 50,000 -70,000 naira per annum while the the same space will go for between 20,000 -25,000 naira in Lagos Island CBD.
He noted that some property owners in the Island have also given a facelift to their properties. For instance, Messrs WEMABOD Estates, owners of Western House on Broad Street, have given the property a facelift.
“They have repainted the building, recreated water channels for the air-conditioners and put A/C in the reception and lobby. They have also changed the facial appearance of the building, bought a new generator and retiled the whole place. Right now, the tenants enjoy electricity between 9am to 5pm as against 10 -12am and 2-4pm.previously. Although the service charge has increased, but the tenants are not complaining because they have better facilities and improved services,” he said.