The relative lull in the Nigerian property market caused by the economic downturn in the country is apparently not having any significant effect on land price in the upcoming Eko Atlantic City in Lagos where values are way ahead of what obtains in the city’s close neighbourhoods.
Land price in Eko Atlantic is the highest of the various prime island locations in Lagos including Ikoyi, Victoria Island and Lekki. It is followed closely by Banana Island, the most exclusive residential location in Lagos.
Price per square metre of land in Eko Atlantic, estimated at $1,720 (about N523,000), is about 40 percent higher than the value of land in the neighbouring Victoria Island. That price compares favourably with land values in Manhattan City in the United States.
Manhattan real estate costs an average of $1,773 per square foot, which is also ahead of San Francisco, the next most expensive area on per-square-foot basis, according to NeighborhoodX, a real estate price tracking agent. Land price in San Francisco averages $902 per square foot.
Eko Atlantic is an emerging city in Lagos, Nigeria’s bustling commercial capital. It is the single most ambitious and comprehensive mixed-use development plan to come on stream in the West African sub-region in recent times. Modelled after the Skyscraper District of Manhattan Island in New York City, Eko Atlantic is expected to be home to no fewer than 500,000 residents, with commuter volume expected to exceed 300,000 people daily.
The uniqueness of this city is chiefly in its self-sufficient and sustainable state-of-the-art urban design, its own power, clean water, advanced telecommunications, spacious roads with about 200,000 trees planned to be planted. The residential units will be constructed as vertical high-rise apartment towers which explain its description as Africa’s Dubai.
The city enjoys considerable interest from both local and foreign investors. But in the last two years of economic slowdown in the country, Ronald Chagoury Jnr, vice chairman of South Energyx Nigeria Limited, told BusinessDay that interest has come largely from foreign investors.
“What we have today is a foreign market unlike two years ago when the city was a Nigerian market,” he confirmed.
It is easy to see a correlation between land values in Eko Atlantic and Manahattan Island relative to their closest neighbourhoods.
“Per square foot real estate in Manhattan is the most expensive in the United States, with the average property in the borough eclipsing all other locals,” notes Catherine Clifford in a report, adding that the price beats San Francisco which is widely viewed as one of the frothiest housing markets in the country by a mile.
“While Manhattan real estate is an average of $1,773 per square foot, the next most expensive area on a per square foot basis is San Francisco, which averages $902 per square foot. That’s followed by Boston at $586 per square foot, Washington D.C. at $515 and Miami Beach at $504,” Clifford says.
This reflects the situation is Lagos where Eko Atlantic land goes for $1,720/N530,000 per square metre while land in Victoria Island is selling at $1,244/N379,000 per square metre and Lekki at $681/N207,000 per square metre, but their prices have risen by 14 and 15 percent, respectively, in the course of last year. Oniru land, selling at $579/N176,000 per square metre, has grown by 7 percent over the year, while Banana Island has remained stable.
Ikoyi, the coveted residential and commercial real estate address in Lagos, has shown the strongest growth over the year, growing by 22 percent from $1,039/N316,000 per square metre to $1,226/N409,000 per square metre. But Eko Atlantic is still ahead.
Analysts are of the view that the growth trajectory seen in Eko Atlantic land values underpins the opportunities which it has in store for savvy investors.
“The city harbours great investment and growth potential and the opportunities are limitless,” an analyst who did not want his name mentioned told BusinessDay.
Eko Atlantic is a response to Lagos’ housing shortage in 30 years. The city is meant to bring 250,000 new jobs and address a housing shortage brought on by a surging population. This, and the fact that it’s privately-funded, has lent it the support of the state and federal governments.
It’s being sold to investors as a valuable foothold in Africa which is one of the world’s emerging growth markets.
What makes Eko Atlantic’s development an investment haven is its location. The city borders Lagos directly and it is rising from the ashes of Lagos Bar Beach through the dredging and filling in of 10-kilometre worth of land. Before the project began in 2006, the area was virtually non-existent, giving the city the appearance of being an island created from nothing.
CHUKA UROKO
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