Impact of urban regeneration on commercial property values in Osogbo, Osun State, Nigeria

Abstract

Purpose The purpose of this paper is to assess the effect of urban regeneration and renewal activities initiated by the Osun State Government in Nigeria on the rental values of commercial properties in Osogbo, the state capital between 2008, before the urban renewal programme through 2017, after the urban renewal programme had been completed. Design/methodology/approach Primary data utilised for this study were collected from all the Estate Surveying and Valuation firms involved in the formal management of commercial properties in Osogbo, Osun-State, Nigeria. Information on the types of urban infrastructure renewed and rental values of 63 commercial properties from 2008 to 2017 were obtained from the sampled estate surveying and valuation firms practicing in the study area. Data were analysed using descriptive statistics, analysis of variance and Duncan post hoc test. Findings The findings showed that physical urban infrastructure such as roads, drainages, water supply and wastes disposal have been upgraded in the study area. Also, the study established that the urban regeneration programme had significant impact on the rental values of commercial properties in Osogbo, arising from the statistically significant difference (F(7, 600) = 22.264, p<0.000) between and within annual rental values of commercial properties in the study area. The annual rental values of the commercial properties also exhibited considerable variation based on the Duncan post hoc test. Practical implications The findings from this study indicate that urban regeneration programme by the Osun state Government has significantly increased the investment performance of commercial properties in the study area. Hence, while investors could achieve higher returns on investment by venturing into commercial property investment, revenue could also be generated for government through the collection of property taxes in the study area. Originality/value This study is one of the few studies that have analysed the effect of urban regeneration programme on commercial property values from the perspective of an emerging African economy, using data from Osun State, Nigeria.