Demand softens, rent drops 20% as Ago Palace Way infrastructure worsens
The negative impact of the deteriorating state of infrastructure in Okota, a Lagos suburb, is not only on human health and businesses but also on properties, especially those along the popular Ago Palace Way, where, BusinessDay finding reveals, demand has come down and house rent has dropped by 20 percent.
Before its present sorry state, Okota was ranked as a mid-income community which witnessed an upward movement in property value and rents in 2012 when most migrants from the insurgent atta cks in Northern Nigeria found a residential haven, thus jerking up both capital and rental values. Those values have come down significantly in recent time.
A three bedroom flat in Okota, for instance, currently rents for an average of N600,000 per annum and could even go for as low as N450,000 at very bad spots on Ago-Palace Way as against N800,000 which the same property would go for in Isolo, Ajao Estate or Festac Town.
Also, while a mini-flat would rent for between N250,000 to N300,000 per annum in some parts of Okota, the same apartment will go for a minimum of N400,000 at neighbouring Isolo which boasts of better road network.
A plot of land around the AP filling station, a really bad spot on Ago-Palace Way, sells for nothing more than N15 million whereas in other parts of Okota with better road network, prices could be as high as N25 million per plot, and in other areas with good infrastructure, prices are much higher.
Ago-Palace Way which is the area’s coveted neighbourhood had, before now, served as an alternative route for residents of Isolo, Okota, Ejigbo, Ikotun and Jakande Estate to Lagos Island through Festac Town, but having degenerated to its present state, even residents and business owners along the link road have been compelled to seek new addresses.
“Lack of infrastructure has stagnated property values at Okota in the past few years when compared to other mainland settlements such as Yaba, Surulere, Festac Town, Satellite Town, and even Isolo which have seen property values swell within the same period,” a representative of Diya Fatimilehin & Co who operates on the axis told BusinessDay.
According to him, demand for apartments or even shops at some parts of Okota, especially along Ago-Palace Way, has softened in the past two years when this access road to the area deteriorated.
“Most business owners around the exit of Ago-Palace Way into Amuwo Odofin have moved to new addresses, deserting their shops while the few that are still there are only waiting to see off their rents,” our source further revealed, adding that this also applies to residents.
Aloysius Ojini, a property lawyer in Okota, agrees, stressing that poor state of most link roads within Okota is the major reason for the low demand for both commercial and residential properties.
“Most property investors and real estate developers are scared of building in most parts of Okota, especially along Ago-Palace Way because of the poor state of road network within the community; only very few streets are tarred here and this is very critical for any developer”, Ojini explained.
Lagos state government had, in June 2013 provided palliative measures on the 1.3km Ago Palace way. Obafemi Hamzat, the state Commissioner for Works and Infrastructure, told journalist that the temporary rehabilitation which would cost N90 million would help to provide drainages and raise the road level. However, a recent visit by BusinessDay to the area revealed that the state’s palliative measure has been completely washed away by flood.
ODINAKA MBONU