Achieving economic sustainability through real estate, infrastructure development

By Oluwasegun Damiro

NIGERIA’S performance in the 2026 World Competitiveness Ranking published by the International Institute for Management Development (IMD) provides an opportunity to reflect on the country’s economic potential and the challenges that continue to constrain its development. The ranking assesses 70 economies globally across four key pillars: economic performance, government efficiency, business efficiency and infrastructure. While Nigeria possesses considerable economic advantages, including a large domestic market, abundant natural resources and a substantial entrepreneurial base, translating these advantages into sustainable prosperity remains a major challenge. Historically, Nigeria has been recognised as one of Africa’s leading economies. However, its development has been constrained by structural weaknesses and a heavy dependence on crude oil for export earnings and public revenue. Although oil accounts for a relatively small share of gross domestic product (GDP), fluctuations in international oil prices, production disruptions and insecurity in oil-producing communities have repeatedly exposed the economy to external shocks. These vulnerabilities underscore the need to diversify economic activity and strengthen productive investment across non-oil sectors.

Other persistent challenges include inadequate electricity supply, deficient public infrastructure, corruption, inconsistent government policies, insecurity, brain drain, inflation, unemployment and the rising cost of living. Together, these factors have weakened purchasing power, increased business operating costs and intensified socioeconomic hardship. The World Bank estimates that 69.6 per cent of Nigerians lived below the lower-middle-income international poverty line of US$4.20 per person per day in 2025. This highlights the scale of the challenge of achieving inclusive and sustainable economic development. Despite these difficulties, Nigeria remains a country of immense, largely untapped economic potential. What is required is a sustained commitment to structural transformation, productive investment, institutional reform and inclusive development. The economy must be deliberately repositioned to generate employment, create wealth, improve living standards and establish a resilient foundation for long-term prosperity.

The current administration has introduced several economic reforms and initiatives, including fuel subsidy removal, foreign exchange reforms, tax reforms, power sector interventions, infrastructure investment, agricultural and industrial support programmes, and housing initiatives under the Renewed Hope agenda. These measures seek to strengthen public finances, improve economic efficiency, attract investment and stimulate growth. Their ultimate success, however, will depend on effective implementation, policy consistency and the extent to which their benefits translate into improved living conditions for ordinary Nigerians. While these initiatives are commendable, achieving genuine economic sustainability requires greater and more consistent investment in real estate, housing and infrastructure development. These sectors are not merely supporting components of the economy; they are fundamental drivers of productivity, employment, wealth creation and social stability.

Government housing programmes, improvements in transportation networks and the expansion of essential infrastructure can stimulate economic activity across multiple sectors. However, these interventions must be supported by adequate funding, transparent procurement, effective project delivery and coordinated policies that encourage meaningful private-sector participation. The government must therefore commit substantial resources to critical infrastructure, accelerate housing delivery and establish an enabling environment for private investment. This includes addressing barriers to land access, improving land administration and property registration, facilitating access to long-term finance, promoting affordable construction technologies and strengthening development control. A coordinated policy framework that brings together government, financial institutions, developers, investors and built-environment professionals would help unlock opportunities that remain largely underdeveloped. Nigeria’s infrastructure and housing deficits, while serious challenges, also represent substantial opportunities for investment, innovation and economic expansion.

The real estate sector, in particular, deserves greater attention. Nigeria’s growing population, rapid urbanisation and increasing demand for residential, commercial and industrial space create significant opportunities for development. Yet, access to adequate, safe and affordable housing remains beyond the reach of many households. The housing challenge is not simply a question of the number of available units; it also involves affordability, location, quality, infrastructure provision and access to essential services. In January 2026, the Federal Ministry of Housing and Urban Development announced that Nigeria’s housing deficit for 2025 stood at an estimated 14.925 million units. The estimate, developed by the National Housing Data Technical Committee, highlights the scale of the challenge and the need for evidence-based housing policies, sustainable financing and increased housing supply.

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This deficit should not be viewed solely as a social problem. It also represents an opportunity to stimulate investment, create jobs and develop the industries that support housing delivery. Nevertheless, converting this opportunity into meaningful outcomes requires housing that matches household incomes, is appropriately located and is supported by adequate infrastructure.

Government cannot meet this demand alone. Private developers, institutional investors, mortgage institutions, pension funds and other long-term capital providers must be encouraged to participate through appropriate financing structures, credible policies and commercially viable development models. Expanding access to mortgage finance, improving land-title security and reducing the cost and time associated with property development would help strengthen investor confidence and housing supply.

International experience demonstrates that real estate can make a substantial contribution to national economic output. Following Nigeria’s GDP rebasing exercise using 2019 as the base year, the National Bureau of Statistics estimated that real estate accounted for 10.78 per cent of GDP in the revised estimates for that reference year, placing it among the country’s leading economic activities. The increase reflected, in part, improved measurement of informal-sector activities.

This demonstrates the importance of real estate within Nigeria’s economic structure and reinforces the case for greater investment in housing, commercial property, industrial facilities and supporting infrastructure. However, the sector’s contribution should not be confused with that of construction, which is measured separately in national accounts.

Real estate also offers opportunities for long-term investment and asset creation. Property can generate rental income, appreciate in value and serve as a productive asset over time. These characteristics make it an important component of a diversified investment portfolio and a potential vehicle for preserving and transferring wealth across generations.

However, real estate should not be regarded as a risk-free investment. Property values can decline, rental income can fluctuate, and investors may face liquidity constraints, financing costs, construction risks and regulatory uncertainties. Its long-term investment potential is best realised when decisions are supported by sound valuation, professional property management, proper due diligence and effective risk assessment.

Beyond investment returns, real estate and infrastructure development have significant multiplier effects across the wider economy. Construction projects create direct employment for engineers, architects, builders, quantity surveyors, estate surveyors and valuers, artisans, technicians and other professionals. They also stimulate demand for cement, steel, roofing materials, electrical installations, furniture, transportation, logistics and numerous other goods and services.

Consequently, increased investment in housing and infrastructure can strengthen local industries, expand business opportunities, improve household incomes and broaden the government’s revenue base. Well-planned infrastructure also reduces the cost of doing business, improves connectivity, supports industrial development and enhances the productivity of workers and enterprises.

To realise these benefits, government must recognise that infrastructure development and housing delivery are interconnected. Residential developments without adequate roads, electricity, water, drainage, sanitation and public transportation are unlikely to deliver sustainable communities. Similarly, infrastructure investments that are not integrated with land-use planning and economic development objectives may fail to achieve their full potential.

Investment decisions must therefore be guided by comprehensive urban planning, credible data, appropriate project appraisal and long-term maintenance strategies. Public-private partnerships can play an important role where risks are properly allocated, contracts are transparent and projects offer demonstrable public value.

Equally important is the contribution of professionals, particularly Estate Surveyors and Valuers, whose expertise extends beyond property transactions. They play essential roles in property valuation, investment appraisal, feasibility studies, development advisory, asset management, property portfolio optimisation, compulsory acquisition compensation and the assessment of development opportunities. Their professional input can help government and investors allocate resources efficiently, assess risks and make informed decisions about real estate and infrastructure projects.

Achieving economic sustainability through real estate and infrastructure development therefore requires a deliberate partnership between government, the organised private sector, financial institutions and relevant professionals. Government must provide policy stability, effective regulation and critical public infrastructure, while the private sector brings capital, innovation, operational efficiency and commercial expertise. Professionals must ensure that projects are properly planned, evaluated, implemented and managed throughout their life cycles.

As Nigeria marks 66 years of independence in 2026, the country must move beyond economic reforms measured principally by macroeconomic indicators and place greater emphasis on the productive opportunities those reforms create. Economic growth must ultimately be reflected in better housing, more jobs, improved infrastructure, stronger businesses and a higher standard of living for citizens.

Nigeria possesses the population, market size, professional expertise and entrepreneurial capacity required to achieve this transformation. What is needed is a sustained commitment to converting these advantages into productive assets and inclusive economic opportunities.

Real estate and infrastructure development must therefore occupy a central position in Nigeria’s economic strategy. With consistent policies, adequate financing, effective governance and collaboration among all relevant stakeholders, these sectors can become powerful engines of employment, investment, poverty reduction and long-term economic sustainability.

•Damiro, an estate surveyor and valuer, is based in Lagos.