Lagos State governor, Babajide Sanwo-Olu, has reaffirmed the central role of real estate and property investment in driving the state’s economy, describing land as the equivalent of an “oil well” for Lagos. Speaking at the 2026 edition of the BusinessDay Property Investment and Smart Cities Conference, the governor emphasized that disciplined property investment is not only an economic engine but also a tool for social inclusion and urban resilience.
Lagos: Africa’s Second-Largest Economy
With a Gross Domestic Product (GDP) of about $259 billion by purchasing power parity (PPP), Lagos ranks as Africa’s second-largest economy after Cairo, Egypt. The Lagos Economic Development Update (LEDU) 2025 projects the state’s economy to expand from ₦54.77 trillion in 2024 to ₦66.47 trillion in 2025, with real GDP growth estimated between 5.02 percent and 6.49 percent.
Officials attribute a significant portion of this growth to real estate, which accounts for about 37 percent of all real estate activities in Nigeria. The sector’s scale underscores its importance not just to Lagos but to the national economy.
Real Estate as a Growth Driver
Governor Sanwo-Olu noted that property investment contributes far beyond GDP figures. It helps close the housing gap, improves living standards, and strengthens urban resilience. “The sector creates jobs across the value chain, from architects and engineers to artisans and suppliers, while stimulating demand for locally produced materials and supporting small businesses,” he said.
Samuel Ajose, chairman/CEO of Levitical Group, echoed this sentiment. His company, active in real estate and construction, provides housing across income brackets while creating direct and indirect employment. Ajose emphasized that property investment is a multiplier for economic activity, touching families, communities, and businesses alike.
The Era of Capital Discipline
A recurring theme at the conference was “capital discipline.” Sanwo-Olu stressed that global and local investors are becoming more cautious, with higher financing costs and a preference for certainty, transparency, and long-term returns.
“Capital discipline is not simply about spending less; it is about investing wisely, in projects that deliver economic value, social inclusion, and environmental sustainability,” he explained. Investors today, he added, are no longer chasing short-term gains but are seeking clarity of vision, predictability of policy, and alignment between infrastructure and development.
To meet these expectations, Lagos is strengthening planning systems, digitizing land administration, and improving transparency in approvals to reduce uncertainty and transaction costs. The government is also aligning infrastructure delivery with growth corridors, ensuring that roads, transport networks, power, and digital connectivity support where people live and work.
Expert Perspectives on Capital Discipline
Hakeem Oguniran, CEO of Eximia Realties, reinforced the governor’s message. He described capital discipline as a shift from production volume acquiring or developing as many properties as possible to financial value, optimizing every naira deployed.
According to Oguniran, property investment should prioritize cash flow, manage debt levels, and avoid impulsive, panic-driven decisions. He introduced the concept of “return on ego” (ROE), warning that investors must manage emotions and resist vanity-driven projects. Capital discipline, he argued, builds investor trust and credibility through transparent, data-driven objectives.
Policy, Infrastructure, and Investor Confidence
Sanwo-Olu emphasized that government leadership is critical in fostering investor confidence. By digitizing land administration and reducing transaction costs, Lagos aims to create a predictable environment for responsible investment. Infrastructure alignment is also key: roads, transport, power, and digital networks must support residential and commercial growth corridors.
This approach reflects a recognition that property investment is not just about buildings but about ecosystems. When infrastructure and housing are integrated, urban resilience improves, and economic activity flourishes.
Real Estate as Social Inclusion
Beyond economics, property investment plays a vital role in social inclusion. Affordable housing reduces inequality, while disciplined investment ensures that developments are sustainable and accessible. Sanwo-Olu highlighted that responsible investment strengthens communities, improves living standards, and supports small businesses.
Ajose’s Levitical Group illustrates this principle by providing housing across income brackets. Such initiatives ensure that growth is not confined to elites but benefits families at different economic levels.
Lagos’ Strategic Position
Lagos’ robust economy and strategic position make it a magnet for investment. As Nigeria’s commercial hub, the state attracts both local and international investors. Its GDP size, infrastructure projects, and policy reforms position it ahead of other Nigerian states and as a continental leader.
The property sector’s contributed 37 percent of Nigeria’s real estate activity which underscores Lagos’ dominance. With disciplined investment, the state can sustain growth while addressing housing needs and urban challenges.
Challenges and Opportunities
Despite its strengths, Lagos faces challenges. Financing costs are rising, and investors demand greater transparency. Urbanization pressures strain infrastructure, while housing demand outpaces supply.
Yet these challenges also present opportunities. By embracing capital discipline, Lagos can attract long-term investment, reduce volatility, and ensure sustainable growth. Policy reforms, infrastructure alignment, and digitized land administration are steps in the right direction.
The Road Ahead
Sanwo-Olu’s vision for Lagos is clear: property investment must be disciplined, transparent, and aligned with infrastructure. This approach will not only drive economic growth but also foster social inclusion and urban resilience.
As Oguniran noted, the future of property investment lies in strategic allocation, cash flow management, and credibility. Investors who embrace these principles will thrive in Lagos’ dynamic market.
Ajose’s emphasis on housing across income brackets highlights the sector’s social role. Real estate is not just about profits but about communities, families, and livelihoods.
Conclusion
Lagos stands at the intersection of opportunity and responsibility. With a GDP of $259 billion and projections of continued growth, the state is Africa’s economic powerhouse. Real estate and property investment are central to this trajectory, accounting for a significant share of activity and driving employment, housing, and infrastructure.
Governor Sanwo-Olu’s call for capital discipline reflects the realities of today’s investment climate. By prioritizing transparency, predictability, and sustainability, Lagos can attract responsible investment and ensure that growth benefits all.
The message from the BusinessDay Property Investment and Smart Cities Conference is clear: property investment is not just about buildings, but about building the future. For Lagos, that future is robust, inclusive, and resilient.
