Despite the rise and rise of what has come to be known as ‘new urbanism’ that has seen the emergence of urban communities such as Eko Atlantic City, Gracefield Island, Orange Island, among others, Victoria Island (VI) remains a compelling destination for investors and home buyers in Lagos.
This is an affluent island that comprises a former island of the same name that sits between Lekki Peninsular and Lagos Island and the Lagos Lagoon. It is one of the areas under the Eti-osa Local Government Area of Lagos.
Like other areas on the Island, it is surrounded by water, mainly the Atlantic Ocean and the Lagos Lagoon. It is that part of Lagos state that has distinguished itself as a business hub yet maintaining its conduciveness as a residential area.
A major reason for VI being a compelling destination is its location. This is a major consideration for investors because the value of a property is highly influenced by its location. Investment experts are of the view that owning
a property in Victoria Island is one of the most valuable investments to make.
According to them, owning land on the Island connotes a certain sense of luxury as the purchase value is often very high which is great news for savvy investors.
Investors are always looking for areas where property value is appreciating fast. This is part of the strengths and opportunities that Victoria Island market offers. Udo Okonjo, CEO, Fine and Country West Africa, notes that the migration of the high net-worth individuals to Lagos Island has further increased its value, creating a competitive market.
Okonjo, whose company is a leading real estate marketing, leasing and advisory firm, added that real estate in Victoria Island offers an investor the opportunity to get significant returns on his investment. “This is possible because VI is in a strategic location and Lagos Island is always experiencing new developments such as new infrastructure, roads, social amenities and many more,” she explained.
She advises investors not to be discouraged by the present economic downturn, especially as it affects real estate which slipped into negative growth territory once again in the second quarter of this year after existing a three-year recession that started in the first quarter of 2016.
This advice becomes more instructive considering that in all ages and economic cycles, real estate remains an investment destination where investors will always get value and return on investment, especially if the investment is done in the right place at the right time and for the right reason.
Bonds, treasury bills, equities, mutual funds, etc are all good investment asset classes but cannot compare favourably with real estate in terms of reliability, flexibility of use and potential for value appreciation over time.
Good yield on any investment is very important because it compensates for the investor’s time, efforts and the sacrifice in terms of forgone alternatives to the investment. This is why where to invest and get good yield is critical and this is when VI comes to mind.
The National Bureau of Statistics (NBS) noted some time ago that Lagos records the highest amount of real estate activities at 37 percent followed by Abuja with 22 percent and Rivers state with 6 percent, covering 65 percent of all real estate activities in Nigeria.
The Lagos real estate market is distinctively segment into low, middle and high end. Demand is very weak at the low end market because this is where low income earners look for housing. At the midend market, demand is relatively strong, but very strong at the high end market.
Ikoyi, Victoria Island and Lekki, the three island locations, constitute the core of high end submarkets. But to invest wisely and profitably in these locations, an analysis of each location’s strengths, weaknesses, opportunities and threats (SWOT) should be done.
In Victoria Island, the strengths are in its excellent location, ease of obtaining approvals for development based on precedent, high rents and return on investments (ROI) based on demand, and a wide mix of support service companies.
The weaknesses include poor parking, traffic congestion, lack of supporting infrastructure, high cost of land and approvals, building would be restricted to high rise apartment to enable maximisation of land, and available land for residential development within this axis is extremely small
The opportunities in this location include lack of good quality residential and commercial space and demand for this is high; there is also opportunity for corporate entities and individuals to own properties close to their offices.
