How to invest and compound ₦1 billion Naira in real estate.

11 min readJul 14, 2024

If you just came across this article, or someone sent it to you or you just stumbled on it while browsing Facebook or any other social network, congratulations.

I congratulate you because today I am going to take you behind the scenes and show you how i build ₦1 billion real estate investment portfolios for my clients.

This is something, a privileged information you can’t find elsewhere and for which my clients pay me 5% in consultancy and brokerage fees for me to share with them and help them implement, but today. I will be sharing it with you at zero cost.

Now, in case you are thinking, ‘invest and compound ₦1 billion? ₦1 billion?’

₦1 billion is not really much as far as real estate investing is concerned. It can buy some good properties but not much, not much at all.

Also in case you are saying within yourself, ‘Ah Ugochukwu, I don’t have ₦1 billion to invest in real estate now’.

That is fine, this article is still for you. You don’t learn writing on the day of the exams, no! You learn writing, so whenever exam comes around you can write perfectly and pass with flying colours.

So if you don’t have ₦1 billion to invest right now in real estate, that’s fine. I believe one day you will have and when that day comes, I want you to know how to go about investing it successfully and profitably in real estate.

If you have ₦1 billion Naira now to invest in real estate, that's wonderful. This article is a must read for you. A must read.

Now before I continue I want to answer another question you might have on your mind currently,

why should you invest ₦1 billion in real estate?

The truth is that I can give you 20 different reasons why you should invest that, even more in real estate but I don’t want this article to be too long so I will cut it down to only 1.

Do you need to invest ₦1 billion in real estate for yourself? No, not necessarily for yourself, but do you need to invest that, possibly more for your kids and grandkids?

Absolutely Yes!

You see we go through stages in life. The growing stage. The building and wealth accumulation stage and finally, the legacy stage.

You have gone through your growing stage. You have mostly passed or are in the latter stages of your building and wealth accumulation stage. Now is time to start talking and working on your legacy stage.

What legacy do you want to leave for your kids and beloved grandkids who always fill your heart with so much joy? What perfect gift of love?

Do you know the best gift to give those you love? It is a gift that keeps on giving. A gift that they will still have even when you are no longer here. A gift that will still be here taking care of them even after you are gone.

A gift, a legacy that will outlast you and for which they will forever be grateful to you for.

Now please tell me, is there any better gift, any better legacy than tangible real estate properties scattered in the most strategic of locations?

Is there any better way to pass down your wealth to them, to leave a legacy of wealth for them than to have different real estate properties generating cash-flow for them, while at the same time appreciating in value for them?

This is why you should invest ₦1 billion Naira, possibly more in real estate.

Now that we have established the why, it is time for us to talk about the how.

How should you invest and compound ₦1 billion in real estate?

Please take note of the words I used. ‘Invest’ and ‘Compound’.

This particular investment is not for you to use to pay for you and family’s vacation to Barcelona, Paris, Bali or whichever location you prefer for your vacations, no!

This investment has one purpose and one purpose only, and that is for you to build long term wealth that can and will outlive you. That is its sole purpose, that is why you need to invest and compound.

The compounding part means that whatever proceeds or cash flow coming out of this investment, you will be using it to buy and invest in more locations.

That is the purpose of all this.

With all that said, let’s get to the main part. How do you do all of this?

Do you take the ₦1 billion and just go buy a duplex in Ikoyi then rent it out? ₦1 billion can’t even get you a duplex in Ikoyi, a 3 or 4 bed apartment maybe but not a fully detached duplex.

Or do you take it and go buy up houses in Lekki, or Ajah perhaps?

How exactly do you invest and compound ₦1 billion?

You need to diversify it. You need to invest it in 3 different categories of real estate, namely.

Trending investments.
Scarce investments.
Emerging investments.

Let’s go over these categories one by one starting with trending.

1.Trending investment; trending real estate investments are the popular and well known real estate investments like investing in off-plan properties.

Buying finished and completed houses then renting them out per annum or per day if you are using them for shortlets. Investing in office spaces, co-working spaces and a host of others.

50% of your funds should go into investments in this category. 50% which in this case is ₦500 million.

So you can take ₦500 million and go to locations like Ajah and acquire 5 duplexes, fully detached duplexes ideally. At ₦100 million each then rent them out per annum. Average rent per annum here for a detached duplex is ₦5 million so this automatically gives you a guaranteed cashflow of ₦25 to ₦30 million annually.

Not much at all but remember that we are going to compound this. You won’t be taking this out to spend, no! This is not for that. This is for compounding and you know what happens when things compound.

You might be wondering why I didn’t mention Lekki Phase 1, ₦500 million won’t get you much in Lekki Phase 1. At most, it can get two fully detached houses but not more and the two will even be war, most likely a very good off-plan deal.

You need a location where your ₦500 million will at least get you something good and substantial. You might also be wondering why I didn’t mention a terrace duplex or a semi-detached duplex. Why must these acquisitions be a fully detached duplex?

With a fully detached duplex you own not just the building but the land upon which it sits too. This is very important because remember, this is a long term investment and the land will play a very important part in the appreciation of the project.

To get the a better deal I will suggest you shop around for good off-plan projects and buy them. An off-plan property is a house that is still under construction.

Why am I telling you to buy houses still under construction? You will get these houses much cheaper, sometimes as much as 40% or 30% below its market value.

This is why you should think about acquiring houses off-plan, this will enable you acquire even more units on your budget of ₦500 million.

However you have to be extremely careful when buying houses off-plan so you don’t get burnt. There are a lot of risks and factors involved when buying a property off-plan. Be careful when investing in off-plan properties.

So that’s that. Invest ₦500 million of the ₦1 billion in trending real estate investments.

So what do you do with the leftover ₦500 million? To find out we need to discuss the second category you should invest in.

2. Scarce real estate investments; Scarce real estate investments as the name implies deals with buying real estate properties that are exclusive and very limited in supply.

The strategy is simple, buy them and hoard them, being that they are very scarce in supply, the longer you hoard them the more valuable, the more they appreciate.

So what are examples of scarce real estate properties? Waterfront properties are one.

Water front lands are scarce. Please when I say water front I don’t mean Ikoyi waterfront, or Banana Island or Eco Atlantic, you will need a lot more billions, a lot more to go for these.

I mean waterfront lands in new and developing estates. There are a lot of new estates coming up in locations like Sangotedo, Ibeju-Lekki, with genuine and perfect title and approvals that are close to beaches and the ocean, you can buy up all the lands closest to the beaches and hoard them.

Knowing fully well that when these places open up, everyone will be coming to you because the choicest part of the place belongs to you.

Another good example are all the new estates being launched in Ibeju-Lekki directly beside the Lekki-Epe Expressway. You can go to them and acquire all their commercial plots that is closest to the Expressway.

For this to work you need to buy it up so that only you will own these scarce, exclusive properties in these locations. This will give you monopoly.

Lands on the mainland is increasing becoming scarce, you can position there too. There are many ways for you to do it but the main thing is that you find real estate properties, lands that by their nature or location are limited in supply or very exclusive then buy them up.

This strategy is very powerful because it gives you full control, whenever you or your kids are ready to sell, you can name your price and get it because firstly this particular property is in short supply and as far as that location is concerned, you are the only person that has it.

for this investment category you should invest 42% of your money which in this case is ₦420 million. To be honest with you this ₦420 million won’t get you much in this category because the scarce nature of these properties always makes them pricey, the average price of a plot of land in these scarce category is around ₦70 million per plot. So we are looking at just 6 plots. Not much. Not much, however we have to make due with it. We are on a very tight budget.

Now we have only ₦80 million left. Remember I told you that ₦1 billion is not much. Like play, we have only ₦80 million and all that we have been able to buy are 5 houses and 6 plots of land.

So how do you invest this remaining ₦80 million? You use it to buy emerging locations.

3. Emerging location real estate investments; emerging locations basically means the locations that are still coming up. Developing locations. Growing locations that today may be bush but tomorrow can become a mega city.

A plot of land today in Lekki is going for ₦100 million and above but there was a time Lekki was a developing location and was selling plots of lands for peanuts.

As a matter of fact some people were being begged to come and buy land in Lekki and they said God forbid, today that location that was emerging then, has finally emerged and is now selling for hundreds of millions.

In the early 2000s Pastor Paul Adefarasin the senior pastor and founder of House on the Rock church acquired about 10 acres of land at Lekki Peninsula for just ₦25 million.

Note that an acre is 6 plots so this is about 60 plots of land at Lekki Peninsula for just ₦25 million. That's about ₦417,000 per plot.

How much do you think these lands are worth now? How much do you think this ₦25 million investment is worth now?

Over ₦5 billion. That is the power of buying lands in emerging locations.

Emerging locations give you extra-ordinary ROI, the only drawback is that they need time to appreciate. Real estate investments in emerging locations need time, 10 or 20 years to properly appreciate but that is not really a problem for you, remember this investment is not for you.

We are talking about your kids and grandkids. We are talking about your legacy. This ₦1 billion is a long term investment. So don’t say that 10 years is a long time or that 20 years is a long time.

For you it might be a long time but for your kids, it is the perfect time. It is the best investment.

Joseph Adefarasin, the father of Paul Adefarasin whom I already told you about couple paragraphs earlier, bought land at Akin Adesola, which is now Victoria Island for just £2,000.

Few decades later, by then he had even died. His children sold the same piece of land he had bought for just £2,000 for a whooping $5 million dollars.

Do you see why buying emerging locations, even though it is a long term investments so powerful?

For this investment category, ₦80 million is enough for you to get started. This is because the average price of lands in emerging locations is ₦4–₦6 million.

So with the ₦80 million you can acquire a few acres.

As you start to get more money from your investments in the trending category, you can invest back into buying more properties in the emerging locations category.

So how do you identify emerging locations? I have written extensively on this topic, I can’t really cover it here again because that is a big topic on it's own however I can give you some good examples.

Epe currently is an emerging location, some parts of Ibeju-Lekki are emerging locations, same with Ibadan et cetera.

So that's it. This is how you invest and compound ₦1 billion in real estate. Do you now see that it is not much?

It is not much but the magic is in the compounding. Whatever cashflow you are getting from the houses you bought in the trending category, use it to acquire more properties in both the emerging and scarce category.

Whatever you are getting, invest it back and let it compound. Do this for 5 years then check the value of your assets. Do it for 10 years then check the value of your assets.

You will be looking for me wherever I am and thanking me.

What I just shared with you costs people a lot of money to learn, don’t take it for granted, make sure you implement it.

Ofoegbu Ugochukwu, founder and lead consultant, Rose Garden Realty

I am Ofoegbu Ugochukwu, founder and lead consultant of Rose Garden Realty, a leading real estate consultancy and brokerage firm helping companies diversify their investment portfolio by branching into real estate.

We help individuals as well including Nigerians at home, Nigerians in diaspora and foreign nationals realize their dream of creating, growing and passing down multi-generational wealth through strategic, safe and high ROI real estate investment.