Eko Atlantic City is a visionary project in Lagos Nigeria located adjacent to Victoria Island and Lekki - that will measure a total of 10 million square metres of reclaimed land when fully completed and is currently at 6,520,000 m² of land. It has rapidly transformed the coastline into a world-class destination that showcases the true potential of urban development. Privately funded by South Energyx Nigeria Limited and designed as a sustainable and futuristic city, Eko Atlantic boasts a remarkable array of amenities and infrastructures, offering an unparalleled living experience.
Eko Atlantic City was birthed in 2003 as a solution to environmental hazards arising from the perenial flooding of the Lagos bar beach. For many years, The Lagos Bar Beach had developed a reputation for overflowing its banks and claiming lives and property. Many times, the Ahmadu Bello Way, the road closest to its banks, was closed for safety reasons. Studies showed that between 8-14 metres of beachfront were eroded annually along bar beach .
The project was to be privately funded by South Energyx Nigeria Limited – the developers and city planners, a subsidiary of the Nigeria-based Chagoury Group of companies – working in strategic partnership with the Lagos State Government and supported by the Federal Government of Nigeria.
In 2008, the construction of the new city began. As of May 2009, while the site was being dredged, about 3,000,000 cubic metres of space were sand-filled and placed in the reclamation area, while about 35,000 tonnes of rock were delivered to the site.
Presently, 6,520,000 m² of land (out of the estimated 10,000,000 m²) has been reclaimed, with the Great Wall of Lagos having reached 6.8 km in length (the total length of the Wall will be 8.6 km).
It is almost 20 years later and infrastructural development has achieved substantial completion in Phases 1 and 2 (both phases total a combined area of 5,000,000 m²), with a high portion of the road network already defined; with kerb lines and block paving together with sidewalks, street lighting and planted trees.
Infrastructural development in phase 3 is also underway and 14 major bridges are fully complete. Utility services comprising stormwater drainage, sewer drainage, water supply, electrical power distribution and fiber-optic cable network for IT services are in full progress alongside roadworks.
Eko Atlantic is entering the next and final phase of its land reclamation efforts and the sand-filling process for phase 4 of the project will commence immediately after the completion of phase 3 and extend towards its designated area. The construction of infrastructure and buildings is progressing steadily across phases 1 to 3.
Despite These Great Strides and enormous progress Nigerians with functional structures like the Eko pearl Tower, Azuri Peninsula, Eko Energy Estate among others, many Nigerians believe it is still a largely failed project as enormous portions of the city remains empty and not fully functional. Many proposed projects are still in the conception stage and haven’t even broken ground. Alot more land is still available and usold.
Let’s explore some of the reasons why this is largely the case and Eko Atlantic has remained empty all these years.
1.)It’s Very Expensive: The cost of a plot of land is dependent on its size and location. Land is sold per m². Plot sizes in Phases 1 and 2 starts from approximately 2,200 m² and prices per square metre within this phase starts from $1,150. In Phase 3, land within this phase starts from approximately 1,200 m² mainly for low-rise residential houses where the land prices are at $1,050. There is no maximum capping on the amount of land that can be purchased. Each plot of land can be used for a residential or commercial development or a mix of both - as Eko Atlantic is designed to be a mixed-use city. It is important to bear in mind that plots in Phases 1 and 2 have been created to accommodate mid to high rise buildings and in Phase 3, some plots have been created to accommodate single residential dwellings and low-rise developments. Land in the marina district can even go as high as $30,000 per square metre. This may be the major reason why investors are shying away from this project as it seems to be at the upper section of the market.
3.) Too big to handle: Couple with the pricing, Eko Atlantic might just be too big to manage for a lone private firm like SouthEnergyx. How do you manage and deliver a project of 10million sqms? Even Though You could make the case for eko atlantic - located at the central business district and ocean facing - but do some quick maths, at least $1000 per sqm, 10million sqaremetre of land would equal $10billion dollars in land sales alone. Bear in mind land costs way more than that. Then you factor infrastructure. Who can fund it? For context Nigeria is currently seeking $1.5billion from Worldbank by year end 2023 to shoreup its economy. How possible is it that just one project would attract a $10billion investment excluding infrastructure?
4.)Mounting debt by developer SouthEnergyx: Following from the above, insider reports allege that mounting external debt by the developer has made it impossible for infrastructural development to proceed at the required pace. Coupled with Nigerian’s foreign exchange woes over the past 8 years; servicing those debts and moving forward with infrastructure development in such a large portion of land may as well be an undertaking doomed from the start. This will explain the slow pace of work.
5.) No development timeline guideline for investor: Finally, Eko Atlantic has a very lax policy on development. Investors can purchase land and choose to allow it sit for however long they so choose. This means that you cannot predict development and it might encourage land speculation as developers or investors might buy and hold off development as long as possible.
So you can see 5 of probably the many reasons why the Eko Atlantic project; conceived since 2003 hasn’t been nearing progress or completion with the goal of 300,000 residents and 200,000 daily commuters.
But what many people do not realize in the value of Eko Atlantic city is that, it is special economic zone: a freezone, so all investors get freezone benefits like:
This is the reason why Eko Atlantic is a dollar market. And another Freezone area in Lagos that seems to be doing much better than Eko Atlantic is Alarocity at Ilamija before Epe Lagos state.
In contrast to why Eko Atlantic city seems to be failing; these are the exact opposite reasons why Alarocity seems to be doing better
1.) Cheaper: Alarocity is at the more affordable end of the market
|Plot Type||Size (SQM)||Price ($)||Payment Plan|
|Low Density||500||60,500||12 months|
|Low Density||750||90,750||12 months|
|Low Density||1000||121,000||12 months|
|Medium Density||500||67,500||12 months|
|High Density||1000+||150,000||12 months|
Compare to Eko Atlantic city that starts at $1050 per sqm.
2.) Payment Plan: Alarocity also offers a generous payment plan with an initial deposit of as little as 10% initial deposit to 30% initial deposit and spread the rest over at high as 30months.
3.) Only 2000 hectares: Alarocity is only 2000 hectares; divided into 5 phases. The first phase has already been sold out and this seems to be more manageable than 10million sqm which is the total size of Eko Atlantic.
4.) Debt free: Alarocity is made up of wealthy owners, some of which are CEOs of 500 fortune companies. This project is being sponsored by the private owners with zero external debt. They’ve already put in $250million into this deal. Infrastructure is goin ahead at a fast pace which includes the main boulevard.
5.) Development timeline for investors: Alarocity has a contract in their term sheets that gives investors a timeline of 12 months to 24 months after making full payment to start developing their land. This means investors cannot speculate of just seat on land for years without development; which means the development keeps growing and moving at a fast pace
Are there some lessons Eko atlantic can learn from Alarocity? Which one do you prefer?