The Effects of Standard Gauge Railway on Industrial Property Values, a Case Study of Athi River Town

Abstract

The railway lines act as routes in enhancing movements of people and goods form one location to another in a given region or urban area. These functions which contribute to property value have both economic and environmental effects on the given location. The focus of the Standard Gauge Railway (SGR) was to enhance accessibility to the study area, Athi River has a dominance of industrial properties. This category of real estate property is mainly concerned with uses such as wholesaling, warehousing, processing, and manufacturing. These properties may be classified as light industrial park, heavy industrial park and industrial park for storage/wholesale uses. This study therefore explores the general contributions of railway development on the industrial property values. The study identifies and discusses various variables associated with a railway transport and the property values in the industrial areas. The study was undertaken in Athi River area in the County of Machakos. The sampling frame for the area of study comprised the business community users of railway network and the residents. Primary data was collected through a field survey within the study area. The interviews schedules and structured questionnaires and direct observation were the methods used in data collection. An analysis was done to explain the finding using applied meta-analytical procedures and interpretation is achieved using SPSS data analysis. Notably, this study shows that the development of SGR as a transit investment has affected the industrial property values positively. The SGR investment enhanced access to other locations from station locations. It also enhanced the property appeal to investors and uses, increasing the likelihood for developing the property. However, the development of the SGR had also some negative impacts on property values attributed to factors such as noise, visual intrusion, and the connotation that rail goes hand in hand with industrial uses. The study finds indications to support the assertion that the SGR has had a significant effect on the value of industrial property within the study area. The study recommends that: more investment in industrial properties along the SGR; change of the current institutional, policy and legal agenda; monitoring the rates at which the values and prices of the industrial property by government among others.