Data Centres Emerge as Key Catalyst for Nigerian Real Estate Growth
How Data Centre Growth is Driving Property Values
The Nigerian real estate sector is witnessing a structural shift as data centres transition from niche infrastructure to a primary asset class. Driven by a 3.7-fold projected increase in capacity by 2030, the rapid expansion of digital infrastructure is beginning to reshape commercial land use and property valuations, particularly within the Lagos metropolitan area.
Accelerated Capacity and Investment Inflow
According to a recent report by Estate Intel, Nigeria’s data centre capacity is forecast to grow from 56.1MW in 2025 to over 218MW by 2030. This trajectory is supported by a development pipeline equivalent to 186.37% of existing stock. Strategic investments from global and indigenous players are anchoring this growth, including Airtel Nigeria’s $120 million investment in its Nxtra facility at Eko Atlantic and Equinix’s $22 million expansion of its LG3 data centre.
Market intelligence from Panterra indicates that the construction market for these facilities is expected to reach $565 million by 2029, up from $250 million in 2024. This influx of capital is increasingly concentrated in Lagos submarkets such as Lekki, Eko Atlantic, and Oregun, where proximity to subsea cable landing stations like Google’s Equiano and Meta’s 2Africa is critical for low-latency connectivity.
Impact on Real Estate Sub-Sectors
The proliferation of data centres is creating significant spillover effects across the broader real estate ecosystem:
Commercial Property: The presence of large-scale data hubs is attracting multinational firms requiring Grade A office spaces and serviced apartments for expatriate technical staff.
Property Valuations: Concentration in specific clusters has been shown to enhance land values. In prime Lagos locations, the demand for "carrier-neutral" sites is competing with traditional commercial developments.
Infrastructure Improvements: To support high-density power requirements, developers are increasingly investing in captive power solutions, including gas-powered plants and hybrid solar systems, which improve the overall infrastructure profile of surrounding areas.
Operational Challenges and Market Dynamics
Despite the bullish outlook, the sector faces headwinds related to high land costs and the unreliability of the national grid. Currently, Nigeria’s grid delivers approximately 5,639MW against an installed capacity of over 13,000MW, forcing data centre operators to rely heavily on self-generation. This dependency significantly increases operational expenditure (OPEX) compared to global benchmarks.
Furthermore, while the "build-it-and-they-will-come" approach has dominated recent years, experts at Estate Intel caution regarding a temporary gap between installed capacity and utilised capacity. However, long-term demand drivers including the Central Bank of Nigeria’s data residency mandates for banks and the rise of the domestic fintech ecosystem are expected to absorb new supply.
Forward-Looking Perspective
As Nigeria pursues its National Digital Economy Policy and Strategy, the integration of data centres into the real estate market is expected to formalise. Investors are advised to target commercial properties near emerging data clusters to leverage anticipated infrastructure upgrades and premium rental demand
