Introduction

Since 2015, the Ikoyi office market stock has grown by 260%, higher than Victoria Island (129%), Lagos Island (8%), and Ikeja (108%). The growth of Ikoyi is underpinned by institutional investors and large corporations that have completed up to 118,993m² of new office space. Most of this supply was delivered through Grade A buildings on Alfred Rewane (Kingsway) Road, but other major arteries including Glover Road are now receiving similar investment attention. 

 

If it emulates the growth of Alfred Rewane Road from 2010-2023, the stock on Glover Road alone could rise to 60,548m² in the next 10 years. As such, we are curious to know, how big can the office Market in Ikoyi truly get?

 

Source: Estate Intel 

 

Background

 

Due to severe dilapidation, failing infrastructure, and poor planning in Lagos Island during the 90s, there was a mass relocation into residential conversions in Victoria Island. In response to the demand increase and Nigeria’s strong investment case, investors commenced the development of large commercial office buildings in Victoria Island, some of which are still under construction today – contributing to  Victoria Island’s emergence as a key office node in Lagos.

 

Subsequently, Ikoyi, which was originally planned as a residential area with strict zoning laws, began to generate investor interest in the mid-2010s when supply grew from 45,672m² to 167,560m²  by 2023. As such, it is currently experiencing its own emergence as a relevant business district, just like Victoria Island did over two decades ago.  

 

Here’s what we’re forecasting for the Ikoyi office market:

 

The Ikoyi Office Market Stock is Set to Grow by 64,691m² to 232,251m²  by 2025 

 

Based on the data we are tracking, up to 64,691m² of space is currently active or will become active in the months ahead to bring Ikoyi’s total stock to 232,251m² in 2025. Notable projects include Ulesh Ikoyi, 27 Glover Office Tower, Dangote Industries Headquarters, and BUA Office Development among others.

 

Glover Road Could Emulate Alfred Rewane Road’s 377% Growth Rate in the Next 10 Years

 

As the Lagos office market grows, we’re likely to see more office developments within Ikoyi. Although Alfred Rewane Road accounts for the lion’s share of Ikoyi’s office space, most of its stock was delivered between 2010 and 2023, as it grew by 377% from 13,380m² to over 63,876m² . 

 

Source: Estate Intel

 

Demand for office space in Alfred Rewane Road already spilling into Glover Road, and has led to a pipeline of over 22,935m² to be delivered in Glover Road by 2025. Considering Glover Road is a mixed-use area, if it achieves just 264% of Alfred Rewane Road’s recent growth, supply could increase to 60,548m² – taking Ikoyi office’s total stock to over 292,799m²  by 2035. Bear in mind that Glover Road is still home to the Golden Gate Tower (recently acquired as part of the former Southern Sun) and The Transcorp Hilton Ikoyi development. 

 

Can the Ikoyi office market be as big as Victoria Island’s?

 

At the moment, the office stock in Victoria stands at up to 450,000m². Despite the growing supply of office developments in Ikoyi; Victoria Island’s head start against Ikoyi, and its larger land size make it highly improbable for the Ikoyi office market to ever match up. In addition, Victoria Island’s larger range of property offerings and wider price spectrum can service both multinationals and smaller companies which increases its overall appeal.

 

That said, we anticipate that where the Ikoyi market lags in quantity, it will make up in quality. At the moment, Ikoyi, particularly Alfred Rewane Road, plays host to 75% of A+ Grade developments in Lagos. 

 

As the Lagos office market evolves, we anticipate the city’s business hub to remain within Ikoyi and Victoria Island. 

 

Estate Intel loves your feedback! Let the Insights team know what you think about How Big the Ikoyi Market Can Get by emailing [email protected].

 

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