LAGOS, Nigeria—Africa's cities are
running out of land, prompting a real-estate developer here to erect what might
be Africa's ritziest district on a beach long known as a haven for day laborers
and beer tipplers.
Building into the
Sea
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| Gaining Land from Sea |
Developer Gilbert Chagoury, who has a
gallery in the Louvre named after him, is developing Eko Atlantic, a city for
250,000 wealthy Nigerians on a landfill outside of Lagos. See photos of the
project.
The shacks that crowded the shoreline
called Bar Beach are gone, replaced by construction tents. Families who
squatted here were evicted. For the past four years, a Lebanese-Nigerian
property developer has hosed sand into the ocean, creating new land for planned
jogging paths, yacht jetties and condominiums with helipads for 250,000 opulent
Nigerians.
The new Eko Atlantic township is
emblematic of a booming business in Africa in which developers build walled-off
cities for the very rich on a continent that is still the world's poorest.
Developer Gilbert Chagoury, founder of
Nigeria's Chagoury Group, is the epitome of Africa's moneyed class: Aside from
a friendship with Bill Clinton, whose 1996 presidential campaign he helped
fund, Mr. Chagoury boasts an ambassadorship from St. Lucia to the Vatican and a
gallery in the Louvre named after him and his wife, both contributors.
Flush with funding from French banks
that are enticed by Africa's rapid growth, the 67-year-old Mr. Chagoury is
aiming to cap his career with the most colossal real-estate project in West
Africa.
"This is going to be the
equivalent of Champs Élysées in Paris or Fifth Avenue in New York," says
David Frame, managing director of South EnergX, a construction unit of Chagoury
Group. He was standing on a gravel road that will be paved into an eight-lane
boulevard, ending at a gated exit into the rest of Lagos.
Africa has the world's fastest-growing
cities, according to the United Nations. Its current urban population of 450
million is expected to triple in the next four decades.
As vacant land vanishes in African
cities, foreign investors are responding with the creation of new cities out of
forests, grasslands and landfill. Investors expect to wring big profits from
offering Africa's wealthy places to live, work and shop away from the crumbling
infrastructure and squalor of old cities.
But those projects have come under fire
from critics who point out that they will in no way alleviate the housing
crisis hitting the majority of the population. In Lagos, few will be able to
afford Eko Atlantic's glass tower condos.
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| Eko Atlantic: The Future |
Meanwhile, some of these gargantuan
projects are struggling. Renaissance Capital Financial Holdings Ltd. of Moscow
plans to build a city for 62,000 people on a coffee farm outside Nairobi,
Kenya, and a similar-size project on a pepper field near Ghana's capital of
Accra.
The coffee farm in Kenya is still just
that, as Renaissance works out a dispute with shareholders. The project in
Ghana is mired in a disagreement between local chiefs over who owns the pepper
field.
China International Trust and
Investment Corp. built a $3.5 billion city for 500,000 people near Angola's
capital, Luanda. The suburb opened in 2011 but remains a ghost town, as the
government strains to sell the $200,000 condos to a population whose per-capita
income is $6,000 a year.
At one point in my life you
might have heard me say something like, “I’ve probably made more money in real
estate by accident than I have in the market on purpose.” For many years, you
could buy good-quality property, as much as you could afford, and you were
almost guaranteed to make money. That ended in 2008. Now folks are looking for
bargains, hoping to profit from the crash.
