Nigeria’s Short-Let Apartments Boom as Investors Chase 15% Annual Returns
Nigeria’s real estate market is seeing rapid growth in short-let apartments, driven by higher returns than traditional properties. Investors now favour professionally managed units, particularly in Lagos, where yields have climbed steadily since 2020. Companies like Edala Development are leading this shift with a focus on efficiency and long-term profitability.
Short-let apartments in Nigeria currently offer annual returns of around 15%, with capital recovery possible in about eight years. These figures outperform traditional residential and commercial real estate, making them a preferred choice for investors. The trend has strengthened since 2020, with yields rising from 8-10% to 12-15% by 2025, supported by economic recovery and urbanisation.
Edala Development, managing over N10 billion in assets, specialises in short-let apartments, landbanking, and resort projects across Lagos and Oyo State. Their management arm, Lodge and Loft by Edala, ensures operational efficiency and sustainable returns. The company also targets underutilised plots in high-demand areas, securing cost-effective land for development. Professionally managed short-lets appeal to investors due to their flexibility, resale potential, and stable management. Demand is further boosted by expatriates and tourism, reinforcing their role in Lagos’ housing ecosystem. However, diversifying into resorts and mixed-use projects requires longer development times and higher initial investment. Creative financing strategies and strong project fundamentals help Edala Development attract capital despite market challenges. The firm’s approach also includes converting poorly managed units back to traditional residential use, which can help balance supply in the market.
The rise of short-let apartments is reshaping Lagos’ property sector, with professionally managed units becoming a key part of the housing market. As demand grows, well-located and efficiently run apartments may face affordability pressures. For now, the segment continues to offer strong returns, attracting both local and international investors.
