In the wake of skyrocketing costs of owning apartments following recent realities and the ravaging impact of the economic meltdown on business operations, Lagos based real estate firm, Shortlethomes, a subsidiary of Digital Landlords Nigeria Limited, has predicted over 75 per cent growth in short-lets occupancy rates for 2021 in the country.
The firm observed that while the hospitality and travel industry has taken an unprecedented hit in bookings, with a month on month decline in sales with majority of hosts experiencing close to zero per cent occupancy rates globally due to the COVID-19 pandemic, Shortlethomes consistently maintained its services with a 75 per cent occupancy rate.
Speaking in Lagos, the Founder/Chief Executive Officer of the firm, Mr. Keji Giwa said the market dynamics suggest a less competitive, untapped market gap and therefore more attractive investments in increasing Shortlethomes and apartments in locations such as Lekki, Victoria Island, Osapa London, Oniru, Ikoyi and Ikate where Nigerians in diaspora and the international community do business and visit for tourism.
Findings revealed that through short-term rental, landlords could make upwards of 20 per cent more than they would on a rent-controlled property, according to experts.
Giwa who also oversees Digital Landlords Nigeria noted that there has been an accelerated surge in booking requests and an increased demand for luxury homes away from home, which represents the slogan and brand of Shortlethomes.
“The brand aims to increase its short-let portfolio to accommodate the 98 per cent of extra booking opportunities the company was not able to fulfill in 2020 due to its limited number of properties. In that short space of time, the company has taken bookings from just 500 guests out of it’s 25,200 booking requests in a year due to a limited number of properties, accounting for only 1.98 per cent of total booking enquiries in a year.”
He added that by “acquiring 100 more short let apartments in Lagos, especially around the Lekki Phase one and Victoria Island / Ikoyi axis, not leaving out potential opportunities in Abuja, this drive should help meet the ever-increasing demands for our homes, giving Digital Landlords investors a healthy return on their investments for the next five years.”
According to him, in 2020, all existing Digital Landlords received a 17 per cent short let rental net income on all properties and are set to experience the same in 2021.
He said; “Compare this to local rental income rates of around 3-4 per cent in Nigeria, that’s a whopping 425 to 566 per cent difference in margins. Digital Landlords can expect to get back their return on investment in just 5.8years compared to 20-years for local rental income and then experience year on year profit after each consecutive year. This is the reason why Digital Landlords Nigeria limited will be investing heavily in improving the customer experience on all Shortlethomes digital platforms, taking advantage of Artificial Intelligence Chatbots to automate responses, creating a virtual agent to take bookings and deal with customer service issues 24-7.”
For him, opportunities are rife for the real estate boom that will continue for years to come, stressing that customer-centricity, operational efficiency, and technological advancement are the three core ways for industry to be at the front row of growth trajectory.
He noted that; “The ability to understand how digital technology can enhance every area of your business is key to performance. That is why if any company right now hasn’t gone through a digital transformation or initiated a digital transformation initiative, they’re basically becoming a dinosaur.”