Lagos short-let market gains steam with revenue seen hitting N300bn
*Upscale Ikoyi, VI lead revenue growth
By Mary Adenike
The short-let market in Lagos State, Nigeria’s commercial capital, is gaining momentum, with revenue projected to rise to N300 billion in 2025 from N264.3 billion last year, according to a new report by Edala Homes.
The report, titled ‘Lagos Shortlet Market 2024’, surveyed 5,806 listings, with 78 percent of the data sourced from AirDNA and the remaining 22 percent tracked by Edala Homes. It was developed to provide in-depth insight into the Lagos short-let market, focusing on the performance of various submarkets.
“In 2024, the Lagos short-let market’s total estimated revenue was N264.3 billion. This figure underscores the sector’s significance in the broader hospitality industry and its contribution to Lagos’s economy,” the report said.
It added that key demand drivers include Lagos’s strategic positioning as a business and leisure hub, an influx of domestic and international events, and the rising popularity of remote work and digital nomadism and that the forecast for 2025 indicates a total market revenue of N300 billion, marking a significant growth trajectory.
“The market experienced substantial growth in 2024, driven by increasing demand for flexible and luxurious accommodations across various submarkets. As a vital component of Nigeria’s hospitality sector, Lagos’s shortlet market caters to business travelers, tourists, expatriates, and local professionals,” it said.
A breakdown of the report revealed that Ikoyi led in luxury accommodations, generating N37.5 billion, and revenue is forecasted to reach N42 billion. Victoria Island, balancing luxury and accessibility, recorded N19.3 billion, with expected growth to N21.6 billion, and Banana Island, an exclusive market, contributed ₦11 billion, expected to reach N12.4 billion.
“Lekki Phase I and Lekki Peninsula II remained key players, with revenues of N94 billion and N70 billion, respectively, projected to grow. Ikeja, Surulere, and Yaba also demonstrated strong performance, each poised for continued growth in 2025, reflecting the robust demand across Lagos,’ the report said.
The short-let market in Lagos has recently caught the attention of many investors. Short lets typically generate higher rental income compared to long-term leases, making them an attractive investment option for property owners.
According to a recent report by Estate Intel, a data-driven market intelligence platform, flexibility has been this market’s selling point, as it provides renters with a homely experience and access to hospitality services.
“Lagos as a location for shortlet rentals has seen a massive growth of up to 263 percent in the past three years. Seasonal demand from Nigerians in the diaspora has been the major driver of this sector, as well as the flexibility in services compared to the traditional hotel setup,” it said.
Edala Homes recommends that operators in the market must navigate challenges such as market saturation, rising operational costs, and evolving regulatory frameworks.
“Emphasising differentiation through premium services, energy efficiency, and strategic location offerings will be critical for sustained growth. The Lagos shortlet market remains a pivotal segment in Nigeria’s hospitality landscape, offering robust opportunities for investors and stakeholders driven by consistent demand and strategic urban development,” the company added.
