Landlords and businesses in Apapa, Nigeria’s port city are getting jittery as snarling traffic and terrible road infrastructure have conspired to force businesses and some residents out, leaving a desolate and degraded environment and a property market without value or charm.
The foreign exchange challenge, which has crimped imports and literally dried up activities in the two ports—Apapa and Tin Can Island—has further depressed the area, leading to a sharp rise in the number of houses and business premises that have been deserted and left to rot.
Joe Akhigbe, an estate surveyor and valuer, estimates vacancy rate in Apapa at 50-60 percent. “It could even be more, depending on the segment of the market you are looking at”, he said in a telephone interview, explaining that many residential houses have been deserted and to get the former occupants back is a big issue.
He noted that many businesses have left the area, emphasising that “the exit of Corona Schools from Apapa says it all that the environment is really anti-business”. “Rents have come down; in some locations, we have seen up to 40 percent drop as three-bedroom flats that used to go for N2.5 million now go for N1.5 million, he said, disclosing that a block of 12 apartments he has on Marine Road has been vacant in the past 36 months.
“The result of that invasion is what we have today—a degraded environment, a near-wasteland that is no longer good for both business and residence. Before now, Apapa was at par with Ikeja GRA in terms of property value, but now, where a plot of land in Ikeja GRA goes for N250 million to N300 million, same size of land in Apapa is in the market for N200 million or less”, says Chudi Ubosi, Principal Partner, Ubosi Eleh + Co, a firm of estate surveyors and valuers.
For the landlords and residents, especially those whose life investments are tied to this area, it is all lamentation because they are not getting a kobo from the environment and, according to Paul Odey, General Manager/CEO of Apapa GRA Residents’ Association, “there are properties that, for many years, nobody has leased them and nobody wants to buy, simply because nobody wants to come to Apapa. The real estate business in Apapa died just because the trucks that ordinarily should have a park somewhere, and come to Apapa on a call basis, have refused to do that”.
He recalled that when the siege on the port city started gradually from Creek Road, businesses started failing, and even property owners started losing value for their property, more so when businesses started moving out one after the other. “From Creek Road, it moved to Warehouse Road and now to everywhere”, he lamented.
Businesses are also hard hit by the choking situation in this area and for the new and big businesses like the Apapa Mall, which opened for business about three years ago, it is a tale of woe as patronage has dropped drastically, especially with the recession, which has squeezed household income to a pulp.”
The moderate sized mall is already taking a bashing from the Apapa environment. When BusinessDay visited the mall a couple of days ago, it was discovered that out of about 34 available shop spaces on the ground and first floor of the mall, there were about 10 vacant spaces, representing 29 percent of the leasable spaces available.
A top management officer of the mall, who does not want to be named, said that shop spaces in the mall were rented for N72, 000 per annum but it could now be negotiated especially if a prospective tenant wants to take from shops upstairs, disclosing that traffic into the mall was usually not heavy on Mondays and Tuesdays, but traffic builds up from Wednesday through the weekend.
Some of the notable brands have closed shop in the mall and these include Mr. Price (MP), Suntan, Samsung, Ruff ‘n’ Tumble, Gdeva and other brands. “These businesses have vacated their space due to low business”, an attendant who pleaded anonymity told BusinessDay.
According to him, many of them had to close shop because the current economic situation has led to a drop in sales especially without a corresponding drop in rents to the management of the mall.
“There is not much business here throughout the year and many retailers were finding it difficult to meet their target, pay salary and break even. This is very obvious with businesses that deal on luxury goods, most of them have to move out of the mall to areas like Surulere and Festac where they hope to meet their targets,” the attendant explained.
