Nigeria’s education sector is grossly underfunded, and infrastructural development to match the growing enrolment in tertiary institutions is a casualty of this underfunded state of affairs in public universities.
An estimated 74% of the global youth population will reside in Nigeria and nine other countries by 2035 (2021 World Bank Report), and Nigeria’s youthfulness currently ranks among the world’s top 9. This demographic strength positions Nigeria’s student housing market as a gold mine for real estate investors and developers. In 2022, the education budget was 5.4% of the nation’s total budget, the lowest in ten years. Nigeria’s education sector is grossly underfunded, and infrastructural development to match the growing enrolment in tertiary institutions is a casualty of this underfunded state of affairs in public universities. Despite the National Universities Commission’s drive to increase and improve student accommodation, there remains a mismatch between students’ enrolment and housing availability. Real Estate Investors are, however, seizing the moment to bridge the infrastructure and amenities gap in student housing.
In spite of the very promising outlook for the student housing sector in Nigeria, including high university enrollment projections, the promise of a constant and growing supply of new tenants, higher rents per square meter, property appreciation, and high occupancy rates, student housing developers and investors in Nigeria, however, have to navigate the unique challenge of student housing in the Nigerian environment. Extended, unplanned school closures, as with the recent strike that resulted in the closure of federal and state universities. Many may have to consider and introduce adaptive strategies to mitigate the risks associated with school closure and its impact on projected income. However, depending on location, some possibilities are flexible tenancy that accommodates working millennials and young professionals. Despite its unique context challenges, student housing is undoubtedly an emerging asset class expected to thrive in the Nigerian real estate market.