Neighbourhood Effects of Industrial Land Use on Property Value

Industrial land use is not more than 15% of total land use in Lagos, albeit its effect on residential buildings in surrounding areas is a clog in the wheel of residents.

Land is fundamental to all economic activities. The supply and employment of land is central to the pattern and process of economic regeneration and restructuring. Traditionally, the land used by man was mainly for agriculture.

In recent years, non – agricultural land use has increased due to the increase in population and the growth of industries.

Residential, commercial and industrial are the prominent urban land uses. It has been argued that residential takes the largest percentage of about 60% of any urban land use while industrial use has been assigned 10 percent of the city land use.

The percentage of industrial land use in any urban area might look small relatively to other land uses, however its impact on the socio-economic milieu of the neighbourhood is very enormous. Industrialization brought with it economic expansion-expansion of local employment, expansion of service industries and the local market. Areas where industries are located also experience provision of infrastructure for the population such as roads, health and educational services. The cumulative effect of these innovations is the transformation of the established structure of the immediate society.

Manufacturing industry, which differs fundamentally from other land uses, is an urban magnet and indeed a major feature, which brings about changes in the state and position of cities in terms of their economic and socio-cultural structures. Industrialization on its own part is a government development policy rooted in both national and regional development plans.

The purpose of industrial development of any region though is to provide opportunities of better living and employment to the people, the possibilities of adverse effects on the environment also increases if the adverse effects are not properly contained or reduced to the barest minimum. Thus, there occurs a situation in which the material goods increase but the quality of life deteriorates. Albeit, not much has been done on the impact of industrialization or industrial land use on neigbourhood property values.

One of the objectives of land allocation is the creation of a balanced land use system, that is, the provision of adequate land for the various land uses consistent with the creation of a fundamentally efficient physical environment. Allocation of industrial land in Nigeria is the prerogative of the government (State and Federal) who plan and approve industrial layouts in both the urban and regional areas of the country.

A greater proportion of Nigeria’s industrial plants in the early stages however, were undoubtedly located for reasons of relative geographical advantages. Once an industrial centre is firmly established, its growth process becomes cumulative with increased urban concentration around it.

Location factor on the other hand has significant effect on landed property values. The effect of location on urban land use may arise from a number of sources that may include exposure to adverse environmental factors like traffic noise, fumes and vibration, perceived level of environmental security and neighbourhood amenity.

The impacts of any factory extend beyond its boundary fence and these impacts may be beneficial or harmful to the surrounding community. On the positive side, income generated by employment and trade in the industry will have multiplier effect on the local community as money circulates through the economic system, boosting trade and business. Negative impacts of industrial location are of greater concern from a welfare point of view because they are often neglected in evaluating the costs and benefits of industrial development. Air and water pollution fall into this category as do the various economic and social problems associated with the introduction of large-scale industrial facilities into relatively remote rural areas

Apart from strict structural and design considerations (i.e. room sizes, shapes, finishes, amenities etc) environmental factors like quality of air and water contribute immensely to property values.

Most of the industries in high brow parts of Lagos are large scale firms with nothing less than 500 workers as their labour force and they are also in large scale production, the implication is that they are capable of exerting substantial effect on the property values within the neighbourhood.

In spite of the problems associated with industrial land use as indicated in a place like Lagos, you still find a high influx of people daily. Many people still prefer to live in Lagos as a result of employment or business opportunities, regardless of the health risks involved in staying in industrial areas

As mentioned earlier, the impacts of any industry extend beyond its boundary fence and these impacts could be beneficial or harmful to the surrounding community. Positively, the impact of industrial land use on residential neighbourhood is manifested in their property values. It is believed that industrial estates in Lagos attract positive high demand for residential accommodation, hence, rent and value of properties appreciate in that regard.

It is therefore recommended that both government and private businessmen should endeavour to site their manufacturing industries in areas that are less developed for rural development.

In addition, private developers should seize the opportunity of the high demand for flat house accommodations in industrial areas and invest in residential developments.

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