EST004 - EFFECT OF LOCATION ON COMMERCIAL LAND USE (A CASE STUDY OF IWO ROAD - IDI APE, IBADAN, OYO STATE)

CHAPTER ONE

INTRODUCTION

1.1       Background of the Study    

Land is a national endowment that can be referred to as the portion of the earth’s surface, while land use can be described as a way, manner or order in which land is used by people in an area for deterrent purposes (Srour, et al., 2001). Land use can be described as a way in which land is used by people in an area for different purposes (Soot, 2014). The need for commercial land acquisition for economic and business transaction is to the benefit of the users, and also as the vital sources of government; means of generating income internally. Commercial land use is one of the commercial purposes which include building offices, shops, resorts and restaurants as opposed to construction of a residential house (Taylor, 2000).

Ratcliff (2014) defined location as “the sum total of all the topographical, transport and other factors on land use that characterized a particular neighborhood”. Location can be referred to as proximity or nearness to transport, employment, shopping, recreational and cultural facilities and the factors of any nuisance that is found in the area. It also includes all the socio-economic characteristics of the people who are present in the neighborhood. Therefore, the basic elements in the concept of location together with locational returns and values are convenience: in terms of cost, time, and disutility of movement of persons or goods from one point to another; favorable exposure and unfavorable exposure to social, economic, legal or cultural variables in the environment (Ibrahim, 2009).The initial decision of every organized society, individual or firm is where to locate at a point in time. However, it is clearly understood that the factors that influence such an initial decision completely depend on the reason for the activity to be carried out on that desired location.

The use of commercial lands by investors was properly monitored, and up till date it is still being monitored but not effective like it used to be in the case of investors; who migrated into others areas. The commercial proposed areas tailed to accept the fact that those areas were not purposively commercial proposed areas, but were to support commercial activities (Serah, 2008). This therefore became a treat to the individuals residing in those areas. This work is to demonstrate the effects of location on commercial land use on land value.   From time immemorial, real property is considered one of the three fundamental necessities of life. The fact remains that unlike food and clothing, real property is difficult and costly to acquire. People need to be housed, as it is very essential and indispensable because it is the platform of all human activities.

Hence, it plays a vital role in social, economic and psychological development of an individual, a state and a nation at large. In view of the rapid urbanization coupled with rapid population growth, demand for properties has experienced an up shot. The value of landed properties is influenced by several factors among which accessibility stands to be prominent (Nwuba, 2004). Many property investment analysts often play down accessibility whereas it is a key element in the functioning of land resources that creates advantages and disadvantages of location in the process (Ibrahim, 2005). It is axiomatic to say that landed properties are fixed in geographical location, and are relatively inelastic in supply. In the course of interaction of man and his activities, it has been established that landed properties located in positions of greatest accessibility, are more sought after. Land is a national endowment that can be referred to as the said portion of the earth’s surface, while land use can be described as a way, manner or order in which land is used by people in an area for deterrent purposes.

Leases and licenses grant permission for using others' lands or properties for specific periods of time; they may cover a long period of time, but eventually terminate. Each has different provisions and includes a differing relationship between property user and property owner. In leases, a relationship exists between the user, usually called the tenant or renter, and the landowner (Nwuba, 2014). A lease permits exclusive use, solely to the tenant, for a set period of time. The tenant assumes control over the property during that time, and pays for expenses associated with living on and maintaining the property. At a minimum, lease contracts last 30 days, although many extend beyond that time. Leases transfer and owners may revoke them. Licenses, in contrast, do not transfer and owners never revoke them (Ibrahim, 2005). Licenses permit only specified uses, and do not grant users full control over the property. Taxation on licensed property varies depending on the use.

1.2       Statement of the Problem

The term land use controls refers to restrictions on the use of land by the property owner for the common good.  Traditionally, such restrictions may be imposed through either common or statutory law actions.  The former is essentially a reactive, case by case response driven by very specific circumstances.  For example, the common law concept of nuisance is defined as “an unreasonable interference by one party with another’s enjoyment of his or her land”.  The operation of a company may result in air or noise pollution, diminishing the value of a neighboring parcel.  If the neighbor takes the offending company to court, the result might be an injunction of the offending activity or monetary compensation to the neighboring property owner.   This is a response to a specific set of circumstances.  Legislation and regulation on the other hand provide a more formal, encompassing approach.  In this particular instance, zoning would likely separate the incompatible land uses, precluding the offending impact from arising in the first place. Land use planning implies an orderly process by which the use of land within a municipality, a county, or some other jurisdiction is regulated.  To be effective, land use planning should be based upon a comprehensive plan, which we have defined as long-term studies of the jurisdiction, considering broad social, economic, environmental, and political issues.   The land use controls (e.g., zoning, subdivision regulations, etc.) are the legal mechanisms by which the patterns of human growth and activities are directed. It is axiomatic to say that landed properties are fixed in geographical location, and are relatively inelastic in supply. In view of this this research focuses on the effect of location on commercial land use in Iwo road - Idi Ape, Ibadan, Oyo State and are considered and to further determine whether commercial land use are seriously affected or not by their position and location in the study area.

1.2.1    Research Question 

a.         What are the benefits of location for commercial purpose in Iwo-road-Idi Ape, Ibadan, Oyo State?

b.         What are the effects of location on commercial land use in Iwo-road-Idi Ape, Ibadan, Oyo State?

c.         What are the challenges facing the location of commercial land users in Iwo-road-Idi Ape, Ibadan, Oyo State? 

1.3       Aim and Objectives of the Study

This study aimed at examining the effect of location on commercial land use in Iwo road - Idi Ape, Ibadan, Oyo State, with a view to study its impact on commercial land user.

The objectives of this study is to;

a.         determine the benefits of location for commercial purpose in Iwo-road-Idi Ape, Ibadan, Oyo State.

b.         investigate the effect of location on commercial land use in Iwo-road-Idi Ape, Ibadan, Oyo State.

c.         investigate the challenges facing the location of commercial land users in Iwo-road-Idi Ape, Ibadan, Oyo State.  

1.4       Justification

This study will be of significant to the government and the various players in the Nigerian real estate sector as it assesses effect of Location on Commercial Land Use in Iwo Road - Idi Ape, Ibadan, Oyo State metropolis. It would give us more information and facts on inflation and how it affects the rental values of commercial land use Act in the area of the study. Hence, exposing investors, estate surveyors and valuers to understand inflation better and how it impacts on the rental value of commercial land us Act in Ibadan and Nigeria at large. In addition, it will also help in contributing to the wealth of knowledge established by other researchers in this area.

1.5       Scope of the Study                                 

The scope of this study is based on the effect of location on commercial land use in Iwo road - Idi Ape, Ibadan, Oyo State. But in view of the wide nature of the research topic, the study will focus mainly on Ibadan metropolis which comprises of Iwo road - Idi Ape, Ibadan, Oyo State

1.6       Limitation

This study is limited to the effect of location on commercial land use a case study of Iwo road - Idi Ape, Ibadan, Oyo State.

1.7       Study Area

Ibadan is located in south-western Nigeria in the south-eastern part of Oyo State at about 119 kilometres (74 miles) northeast of Lagos and 120 kilometres (75 miles) east of the Nigerian international border with the Republic of Benin (Wikipedia, 2016). It lies completely within the tropical forest zone but close to the boundary between the forest and the derived savannah. The city ranges in elevation from 150 m in the valley area, to 275 m above sea level on the major north-south ridge which crosses the central part of the city. The city covers a total area of 3,080 square kilometres (1,190 sq mi), the largest in Nigeria. Ibadan city is located approximately on latitude 7^o 23’ North and on longitude 3^o 5’ East of the Greenwich Meridian (Wikipedia, 2014). The name ‘Ibadan’ emanated from “Eba Odan” literarily meaning ‘near the grassland’. This reflects its location on the fringe of the forest zone near the savanna. Ibadan is located near the forest grassland of South Western Nigeria.

The city of Ibadan is naturally drained by four rivers with many tributaries: Ona River in the North and West; Ogbere River towards the East; Ogunpa River flowing through the city and Kudeti River in the Central part of the metropolis (Wikipedia, 2016). Ogunpa River, a third-order stream with a channel length of 12.76 km and a catchment area of 54.92 km 2. Lake Eleyele is located at the north-western part of the city, while the Osun River and the Asejire Lake bounds the city to the east.

 

FIG 1: OYO STATE MAP

Source: Wikipedia, 2017

Fig 2: MAP OF IBADAN

Source: Wikipedia, 2017

FIG 3: IWO RAOD- IDI APE, MAP

Source: Wikipedia, 2017

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