The Covid-19 pandemic initiated and accelerated several consumer and social trends. Mixed-use developments were prevalent in Nigeria before 2020, and lifestyle changes driven by social restrictions made those projects more appealing. “What we have seen is a shift from single-sector developments towards mixed-use real estate,” Bolaji Edu, CEO of Broll Nige-ria, told OBG. “Multiple factors, such as reducing the time people spend in traffic and the security of having amenities close to home are proving highly attractive to many homebuyers,” Edu added.
Proven Blueprint
During its own period of economic expansion, China experienced a high rate of rural-urban migration beginning in the 1980s, and to cope with the strain placed on main cities’ infrastructure, satellite towns and housing developments were built around the mixed-use concept. This featured residential, health care, education, commercial, and administrative services incorporated into their design and in turn provided employment for residents. Mixed-use complexes, in general, have at their core mul-ti-modal public transport services, affording additional efficiency and proving effective in reducing traffic congestion, pollution and urban sprawl. Furthermore, many companies find benefit in locating closer to where customers, clients and staff members operate and live.
Projects
In September 2021 the Lagos State government announced that Messrs Capstone Developers had entered into a public-private partnership (PPP) to develop the 10-storey mixed-use Zirconia Heights building close to Lekki, south-east of Lagos, providing 60 housing units intended for the first-time buyers, alongside office and retail space. In November 2022 pan-African finance institution Shelter Afrique agreed to loan $24bn to Nigerian developer Landmark Africa, which already has several mixed-use developments in Nigeria, for its Landmark Waterfront Apartments project.
The Orange Island project, which was signed in January 2014 and completed its second phase in December 2022, is being developed on 1.5 sq km of reclaimed land off the coast of Lagos under a PPP between Orange Island Development Company and the Lagos State government. The N40bn ($95.3m) development has been designed to transform Lagos into a smart city with energy and operational efficiency at its centre. Aimed at the high-end residential market, the area will house all infrastructure required for it to become a self-contained community. As of May 2022 plots were selling for around N1bn ($2.4m). Meanwhile, the Eko Atlantic City development close to Victoria Island will be similar in size to central Manhattan and contain multiple high-end residential buildings. Once completed in 2027, it will be complemented by modern transport infrastructure, and commercial and recreational facilities.
Problem-Solving Potential
Such projects are key components of a broader drive to develop the coastal regions of Lagos as the government bids to reinvigorate investment inflows. Rural-urban migration is a socioeconomic challenge that adds to the country’s affordable housing crisis. As of 2021 around 53% of the population lived in urban centres, and a shortage of rural infrastructure, as well as social and professional opportunities, are among the factors driving this trend.
“As soon as infrastructure is established, it will be easier to build affordable housing. We must therefore move people and housing around infrastructure,” said Tola Ayanlola, managing director of local real estate development company, Tayan Group, told OBG.
Building high-capacity mixed-use developments outside of Nigeria’s main cities could offer a viable solution to growing housing demand. Such developments could provide residential and employment opportunities for migrating families, potentially becoming the focal point of future satellite towns. As has been the case in China, this could bring the type of economic multiplier effects typical of fully fledged commercial and industrial centres if serviced by modern transit systems and enabled by dynamic government policy interventions.
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