Panterra: Infrastructure Now Biggest Driver of Real Estate Returns in Nigeria

.Says Lagos-Calabar highway, Epe corridor has triggered land value appreciation

Sunday Ehigiator

Infrastructure development has emerged as the single biggest driver of real estate returns in Nigeria, with investors increasingly positioning capital around major public projects that are transforming land values and opening up new growth corridors, according to investment firm Panterra.

Speaking on the outlook for Nigeria’s property market, Chief Investment Officer of Panterra, Ayo Ibaru, said infrastructure projects such as the Lagos-Calabar Coastal Highway, the Lekki Deep Sea Port and developments along the Epe-Ibeju-Lekki corridor are reshaping investment decisions and accelerating returns for early investors.

According to him, infrastructure remains the foundation upon which future real estate value is being built.

“We tried to understand Nigeria’s real estate market through several theories, one of which was William Alonso’s bid-rent theory. What it essentially shows is that as city-centre costs rise, people and businesses move outward, encouraging infrastructure development. Capital is going to where it will accelerate the highest form of return,” Ibaru said.

He noted that the Lagos-Calabar Coastal Highway has already begun to influence property prices along its route, leading to a repricing of both land and residential assets in surrounding areas.

“The coastal road has led to a repricing in land assets and residential assets around the area. Infrastructure is leading the way, and private-sector investors are putting money into these locations to participate in future returns.”

Panterra’s latest market outlook noted that future value is increasingly being concentrated around coastal and eastern expansion corridors, particularly in Lagos, where infrastructure investments are transforming peripheral land into investable residential and commercial assets.

The report stated that homes located within five kilometres of major highway projects now command premiums ranging between 25 and 40 per cent, while properties near new rail infrastructure enjoy value increases of between 15 and 30 per cent.

Ibaru stressed that timing would be critical for investors seeking to benefit from the infrastructure-driven boom.

“A lot of the return from infrastructure-led investments will come from the early movers. By the end of the year, if you haven’t moved already, it might be a bit late to capture some of the biggest gains,” he said.

Beyond infrastructure-linked land investments, Panterra said investor appetite is increasingly shifting toward assets capable of generating predictable cash flow.

The firm noted that capital is flowing into income-producing residential developments, logistics facilities, industrial parks and affordable housing projects, where demand remains strong despite broader economic challenges.

“Smart money is repricing risk in favour of cash flow,” the report stated, adding that investors are becoming less attracted to speculative land banking and more interested in assets with visible rental income and stable occupancy rates.

The report highlighted that Nigeria’s property market remains largely cash-driven, despite efforts to stimulate housing finance. While the Central Bank of Nigeria reduced its benchmark rate in late 2025, mortgage rates remained between 25 and 30 per cent, making home ownership through traditional financing inaccessible for many Nigerians.

As a result, cash buyers, business owners and diaspora investors continue to dominate transactions, particularly in the residential segment.

Ibaru acknowledged the growing attraction of luxury residential developments, describing them as one of the most predictable segments of the market.

“We see a lot of firepower going into luxury housing because it is arguably one of the more predictable investments in the residential market,” he said.

However, he argued that greater opportunities exist in affordable and mid-market housing, where demand significantly outweighs supply.

According to Panterra, affordability pressures are already redrawing residential demand across major cities, with more Nigerians moving to emerging corridors such as Ikorodu, Ibeju-Lekki and border communities between Lagos and Ogun States. Similar trends are also being observed in Abuja’s satellite towns, including Lugbe, Kuje and Karshi.

The investment firm concluded that infrastructure expansion, rising urbanisation and the growing demand for affordable housing would continue to shape Nigeria’s real estate market for the foreseeable future, making infrastructure the most important determinant of property returns in 2026.