Historically the real estate development market in Nigeria has been vibrant. Even so the current world economic slump begin to take hold back in September 2008, it drained the confidence out of many investors and the actual marketplace nose-dived considering the general economic climate. But with the signs of economic recovery beginning to look at hold again, what prospects are there for upset in the industrial property trade?
When industrial and commercial property prices reached another low, it signaled a pair of things. Firstly that the market was severely depressed and was likely in which to stay that way for several years, but also that the bottom of the trough ended up reached in which the only way out, kent ridge hill residences was up. Is not market having stabilized at its new low, it meant how the glut of distressed properties that were being pouring in had stopped, and with laws of supply and demand in operation, while 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, along with property prices still artificially low, this 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 an illustration of the current optimistic outlook on life. With economic forecasts being positive, albeit slow-moving, and prices being as little as they are, now is an excellent time purchase. As confidence returns to the economy, the potential for new letting agreements is rising and properties are much more beginning to move, creating a slow but steady rise in prices and rates. Usually forecast that trend continues slowly but surely, depleting the supply surplus which will eventually trigger a new bout of property development taking point.
Current thinking is this specific may well lead to an industrial property boom in 2014/15. Not surprisingly with this long gestation period for new developments to arrive at final fruition, the process needs to be kicked off now. Feasibility studies, surveys, finance – all things end up being in place before actual construction can start to be fulfilled.
All in many this has grown a very positive time for property development. Industrial property investors have every reason to get cautiously optimistic, as quick to medium term prospects are looking very positive, and now is the time to speculate and put.