Property market records 60% vacancy rate, over N1 million drop in rentals
As property market becomes buyers’ market
Stories by Kingsley Adegboye
FOR several years, residents, business owners, workers, transporters and commuters in the Apapa axis of the Lagos metropolis, have been subjected to excruciating pains due to the endless traffic gridlock in the area. That is apart from the situation negatively affecting business ventures within the axis.
The traffic gridlock, caused by decades of neglect of the Apapa/Oshodi Expressway, the gateway to the nation’s economic nerve centre, is getting worse by the day. This is on account of promises by successive administrations, both at the federal and state levels to find a lasting solution to the nagging problem, remaining largely empty as no real action has been taken to resolve the problem.
Consequently, the number of trailers, tankers and trucks coming to evacuate goods and petroleum products at the Apapa ports has continued to increase, thereby making it very difficult to do business.
The situation has led to business owners and residents in Apapa relocating to other parts of the city with easy access, leaving behind empty commercial premises and homes. They complained that safety and comfortable living are no longer guaranteed in Apapa. Hence, night and day security guards have become landlords in the empty apartments in Apapa community.
A walk through the major connecting roads, including Liverpool, Creek Road, Wharf Road, Point Road, Child Avenue, North Avenue and others, easily confirms this as virtually all the buildings have estate agents’ boards for let and sale. This means people’s investments, made with hard-earned money, are now in ruins while businesses are not any better.
According to Mr. Joe Akhigbe, an estate surveyor and valuer: “Most of the houses in Apapa are empty. We have seen about 60 per cent vacancy rate in that part of Lagos. People are dropping rents to attract tenants, yet nobody is taking up residence there. There are residential buildings where landlords/agents are dropping as much as N1 million and N1.5 million, but no tenants are coming forth.”
Lamenting the free fall in value of property, whether rental or sale in Apapa as a result of the hectic traffic situation, Mr. James Garuba, Managing Partner, James Garuba & Co, a firm of estate surveyors and valuers, said property business in Apapa has now become a buyers’ market, as property owners and agents are now at their mercy.
Pointing out that access is key to real estate business, Garuba said property business thrives where there is easy access in and out of a place, adding that value of property, whether rental or sale in Apapa, has drastically fallen because of the nightmarish traffic situation in Apapa.
Garuba who disclosed that he has been trying to market two apartments in Apapa in the last eight months without success, revealed that with the drop in value of property in the area, it is difficult to market the apartments, insisting that buyers now determine property market in the axis and not the sellers. “As a result of this unfortunate situation, property value in Apapa has dropped by as much as 50 per cent,” he noted.
In a report, Mr. Chudi Ubosi, Principal Partner, Ubosi Eleh & Co, a firm of estate surveyors and valuers, while commenting on the situation, noted that in its good days, Apapa property market was ranked alongside Ikeja GRA, but that is no more the case.
According to him: “Because of the present situation, where a parcel of land sells for N200 million in Ikeja GRA, same size of land in Apapa will struggle to sell for N100 million.”
Of greater concern arising from the diminishing property value and rising vacancy rate in Apapa is also the impact of all these on other locations in Lagos such as Ikeja GRA, Ikoyi and Victoria Island which are the next destinations for businesses and home seekers leaving Apapa. The implication is that what is lost in Apapa will be gained in these other locations. Apart from piling pressure on the grossly inadequate infrastructure there, house rents and prices will go up.
Long hours on traffic that is not only choking, but also life-threatening, has led to loss of quality man-hour on the road, poor mental health of workers, poor and delayed output, low productive capacity and almost zero-competitiveness of products.
It is no wonder, therefore, that on weekly basis, the Nigerian economy loses close to N140 billion which translates to N20 billion daily loss because of the situation in Apapa. This is because Apapa is home to Nigeria’s two busiest seaports which account for over 80 per cent of all import and export activities in the country.
The two major routes to these ports—Apapa-Oshodi Expressway and Apapa-Wharf Road are simply embarrassing. Apapa-Oshodi Expressway, particularly, is a messy metaphor for tedium, drudgery, pain, waste and suffering of monumental proportion. “Apapa Wharf Road is both an embarrassment to the country and a huge loss of close to N140 billion to the government on a weekly basis, as the economy loses more than N20 billion daily because the state of this road which affects businesses across the country.
All our operations in the hinterland such as Ilorin, Kano and others are operating at 40 per cent maximum capacity,” Aliko Dangote, the President of Dangote Group, who spoke at a media parley in Lagos recently, disclosed,” he said. Dangote added: “It is very embarrassing. We can’t just sit and have a road like that in the heart of the trade of the country.”