Jide Onasile and Co

The Rise of Data Centres in Lagos: A Tech-Driven Real Estate Market


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The Lagos real estate market is experiencing a rapid shift towards technology-driven infrastructure, with the launch of two new data centres in recent weeks. The teeming population and technology drive in Lagos have made it an attractive location for digital infrastructure investment. The first branch of the Google Equiano private subsea cable system recently landed in Lagos, expected to boost Nigeria’s GDP by $10.1 billion by 2025.

In November 2021, Africa Data Centres (ADC) completed its 10MW data centre facility in Eko Atlantic City, Lagos, with plans to build ten new data centres in Africa over the next two years. ADC is also looking to launch a second facility in Lagos soon. MainOne, Nigeria’s leading data centre provider for over a decade, got acquired by global digital infrastructure provider Equinix for $320 million and opened a new MDXi Data Centre in Lekki, with a potential reach of 10MW. Airtel Nigeria also launched its data centre facility in Lekki for commercial use. Open Access Data Centres (OADC), a subsidiary of West Indian Ocean Cable Company (WIOCC), has announced its plans to construct a 20MW data centre facility in Lekki, expected to be completed in Q4 2022.

The demand for data centres in Lagos is driven by faster internet connectivity, uninterrupted power supply, and an enabling business environment. With over 7,000 sqm of white space expected to be available by the end of 2022, the growth of the data centre industry in Lagos is projected to continue to skyrocket.

However, the development of data centres in Lagos also presents its challenges. The first is the high cost of land acquisition and building materials. The rapid urbanisation of Lagos and demand for data centres may lead to a rise in real estate prices in the city, which could pose a challenge for startups and small businesses looking to establish themselves in the industry.

Another challenge is the issue of data privacy and security. With the growing demand for data centres in Lagos, it becomes necessary to ensure that these facilities are well equipped to protect data from cyber threats. Cybersecurity breaches can result in significant financial losses and reputational damage for businesses that rely on data centres.

Despite these challenges, the growth of the data centre industry in Lagos presents significant opportunities for real estate developers, investors, and businesses looking to establish a presence in Nigeria’s technology space. The availability of reliable and secure data centres in Lagos is crucial to support the digital transformation of Nigeria’s economy and facilitate the growth of the country’s technology sector.

In conclusion, the growth of data centres in Lagos represents a significant shift towards a technology-driven real estate market. With the launch of several data centres and the expected growth of the industry in Lagos, the city is positioning itself as a prime location for digital infrastructure investment in Africa. While challenges such as high land acquisition costs and data security concerns persist, the opportunities presented by the growth of data centres in Lagos are vast, and the impact on the city’s real estate market is likely to be significant.