The Scoop
LAGOS — After losing its Lagos beachside real estate to controversial government plans for a coastal highway, Nigeria’s Landmark Africa is working on plans to build two new West African beach properties, chief executive Paul Onwuanibe told Semafor Africa.
Onwuanibe said the company had received separate invitations, including one from the Gambian government and from three state governments in Nigeria’s southeast, to develop waterfront leisure hubs aimed at boosting tourism in those places. The two commissioned projects include a development proposed in Akwa Ibom, an oil-producing Nigerian state by the edge of the Atlantic ocean. It is expected to open before the end of the year while the Gambia project “will take a little bit longer,” he said.
The new developments, for which MOUs have been signed, will be wholly funded by Landmark at $5 million each while the land comes from the government partners. “My team met with the Gambian President’s envoy including the First Lady today to finalize plans,” Onwuanibe told Semafor Africa on Friday.
Akwa Ibom’s tourism commissioner, Charles Udoh, said on May 10 that the state was “seeking a partnership” with the company to develop a section of its shoreline for tourism.
Landmark is also “looking at a number of sites in Lagos” to build another leisure property. But that may be challenging because “we have not received any compensation yet” from the Nigerian government for its beach that was demolished, the CEO said.
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Nigeria knocked down leisure and entertainment structures on the Landmark beach in April, drawing the ire of tourism industry watchers who questioned the wisdom in destroying “the biggest tourism spot in Lagos” to build a road.
Visited by locals and international tourists, the beach was also a music concert venue, hosting performances by Nigeria’s leading artists over the years, including superstars Davido and Wizkid. Besides the beach, the broader space is a 9,000 sq. meter boulevard that includes a mall, event center, restaurants and cafes, including the Hard Rock Cafe chain. Landmark has owned the property since 2007.
Nigerian government officials said the beach was on the path of a proposed 700-kilometer highway that would connect the country’s southwest through Lagos to Calabar in the east. A notice for the beach’s demolition was served in March.
The highway, designed to have five lanes on each side, is estimated to cost $11 billion and be completed in eight years. It will be built by Hitech, a company owned by the Chagoury Group whose Lebanese-Nigerian proprietors are long-time allies of Bola Tinubu, the Nigerian president. The firm’s previous work in Nigeria includes Eko Atlantic City, a development modeled after Dubai and built on land reclaimed from the Atlantic Ocean.
Alexander’s view
The ease with which Nigeria did away with arguably the most acclaimed leisure property in its largest city — even as the government talks up its drive for foreign investment — offered little assurance that the country sees itself as a destination for tourism investment. It is also evidence of the risks associated with long-term real estate investment in the country.
At the same time, demand from elsewhere in Africa for tourism investment shows the prospects for the sector.
International tourism receipts into Africa have tripled to at least $35 billion since the early 2000s, according to the World Bank. Despite restrictions caused by the pandemic, travel and tourism in Africa is projected to grow 6.5% annually over the next decade, the World Travel and Tourism Council said. That would add $168 billion to the economy in that period. Only the Middle East performed better than Africa in the first nine months of 2023 in terms of recovering to pre-pandemic levels of international tourism arrivals, the UN World Tourism Organisation said.
African countries with a coastline hold advantages over their landlocked counterparts in the jostle for tourism investments. And intentional governments may have an even greater advantage in the long run.
Onwuanibe is eager to take up the invitation to replicate Landmark’s success in The Gambia, a country of 2 million people with a well developed tourism hub relative to its size. Even if the country has a lower purchasing power than Lagos, he told me the country’s authorities have something his home city does not yet have: “They want to be a tourist destination and they create an environment that’s right for tourism.”
Room for Disagreement
On the proposed highway, John Ashbourne, emerging markets economist at Fitch Solutions in London, argues that Nigeria needs better roads. “Investors understand that sometimes expropriations are necessary for big infrastructure projects,” he said of the demolitions that have occurred, provided the process is transparent and the project viable. “Nigeria definitely needs more infrastructure spending.”
But the reported $11 billion cost will be “incredibly expensive by international standards,” he added, noting that the per kilometer cost would eclipse that of Austria, the most expensive place in Europe for road construction.