Report: Lagos, Abidjan, Dakar Lead as W’Africa’s Most Expensive Land Market

Dike Onwuamaeze

Lagos, Abidjan and Dakar have been ranked as cities with the highest land prices per square meter (PSM) in the West African real estate market. 

This was revealed in the “2023 West Africa Real Estate Market Report,” by Northcourt, a real estate investment solutions company that adopts a research-based approach to developing and managing property as well as providing real estate advisory services in West Africa.

The report stated that average prices of land per square metre in Lagos, Abidjan and Dakar stood at $765, $601 and $273 respectively in 2023, while the average land prices in Bissau and Banjul were $29 and $33 per square metre respectively. 

In addition, Lagos, Abidjan and Freetown also had the highest rentals for three bedroom apartments in West Africa at the range of $32,200, $27,429, $26,200 respectively. 

The report stated that, “in select nodes, average annual rentals for prime 3-bed apartments in Lome, Monrovia and Banjul go for $5,850, $3,850 and $3,244 respectively – benefitting from a renewed investment in infrastructure.

“Heavy hitters Lagos, Abidjan, Freetown, Accra and Nouakchott come in at $32,200, $27,429, $26,200, $17,515 and $14,453 – albeit the assets in demand typically skew towards the high end.”

It added: “Average land prices based on the nodes reviewed ranged from $29 and $33 per square metre in Bissau and Banjul respectively to Lagos, Abidjan and Dakar’s $765, $60 and $273 per square metre respectively.”

The report also stated that West Africa attracted the most venture capital, having raised $1.8 billion in 2022 ahead of North Africa’s $1.1 billion; East Africa’s $1.2 billion and Southern Africa’s $600 million.

Furthermore, the report showed that, “Nigeria and Ghana attracted $1.2 billion and $400 million respectively,” while African startups committed to combating climate change raised an estimated $1.17 billion.

“Data from AfricArena suggests that in 2022, 69 equity financing transactions attracted $863 million of the total funds attracted,” it stated.

Nigeria and Ghana were ranked as countries with highest real estate investment opportunities in West Africa with 32 and 28.5 points respectively while Cote D’Ivoire and The Gambia came third and fourth with 28 and 26 points respectively.

According to the report, “Ghana has emerged as an attractive real estate market due to its political stability and favourable government policies led by the Ghana Investment Promotion Centre.

“Cote D’Ivoire is one of Africa’s fastest-growing economies reporting solid macroeconomic growth which has influenced its real estate market.

“The country offers relatively well-developed road infrastructure, the second-largest port in West Africa, and a modern airport with a national airline that serves all of the major capital cities in the region.

“Nigeria’s economic potential, population growth rate and influence on the region make a fair case for aggressive housing development.”

However, Nigeria recorded a poor showing in West Africa’s real estate’s legal and regulatory environment where it was ranked 7th with 17.5 points.

Cape Verde, Senegal, Gambia and Ghana took the first, second, third and fourth positions with 26, 25, 24 and 23.5 points respectively. Cote D’Ivoire and Republic of Benin took the 5th and 6th positions with 21 and 18 points respectively.

According to the report, Cape Verde, “leads the rankings for investor protection and legal framework offering various incentives and tax reductions, and exemption from general customs charges on goods used for exclusive construction or installation of tourism facilities.”

The report noted that “West Africa’s legal and regulatory environment can be complex, with distinctions between countries in terms of investor protection and the enforcement of property rights.”

It highlighted that Cape Verde’s “investment and industrial development laws treat foreign and domestic investors equally. Priority areas include sustainable tourism, logistics, renewable energy, tech services and export-oriented sectors. Its land laws strongly support access, use, and transfer of land and real estate.”

The report stated that the sub-region’s population, currently estimated at 430 million, was expected to reach 935 million by 2050, which would drive demand for real estate assets.

Nevertheless, the report noted that the West African real estate market was faced with some difficulties, which included a somewhat unwieldy regulatory environment.

It said: “Infrastructure investments are gradually contributing to growing property values. Proximity to retail centres, schools, and healthcare facilities is another key factor as they are attractive to residential and commercial occupiers because they offer greater convenience and accessibility.

“The Real Estate Investment Attractiveness Index by Lieser and Groh provides a framework for evaluating the potential of the West African real estate market. By considering each of the dimensions of investment attractiveness and analysing key components such as economic stability, market transparency, legal and regulatory framework, one may identify the relative strengths and weaknesses of each market. It is hoped that this report will provide a proper evaluation of the West Africa Real Estate market.”