Historically the real estate development market in Nigeria has been vibrant. Even so, if the current world economic slump started to take suppress in September 2008, it drained the confidence out of many investors and the nose-dived along with general economic climate. But with the signs of economic recovery beginning to be able to hold again, what prospects are there for an increase in the economic property market?
When industrial and commercial property prices reached a good solid low, it signaled 2 things. Firstly that the market was severely depressed and was likely remain in that path for several years, but that the bottom of the trough was in fact reached of which the only way out, was up. With all the market having stabilized at its new low, it meant that the glut of distressed properties that were being pouring in had stopped, and with laws of supply and demand in operation, that’s not a problem excess of supply far outstripping demand, prices remained depressed.
However, the last 12 months has seen the warning signs of recovery developing in sector sector, and with property prices still artificially low, it has begun to stimulate demand, as property development speculators are one again sensing the opportunity of making good short to medium term returns on new investments.
Office properties in particular are certainly one of the current optimistic probability. With economic forecasts being positive, albeit slow-moving, and costs being the small sum of they are, now is an excellent time invest in. As confidence returns to the economy, the potential for new letting agreements is rising and properties are had been beginning to move, leading to a slow but steady rise in prices and kent ridge hill residences showflat rates. Usually forecast that trend continues slowly but surely, depleting the supply surplus which will eventually trigger a new bout of property development taking venue.
Current thinking is until this may well lead for industrial property boom in 2014/15. Certainly with such a long gestation period for new developments to go to final fruition, the process needs to be kicked off now. Feasibility studies, surveys, finance – all of these things must be in place before actual construction can start to take place.
All in all this is now a very positive time for property development. Industrial property investors have every reason become cautiously optimistic, as it is definitely to medium term prospects are looking very positive, and this is the time to speculate and put.