If you ask ten property investors in Nigeria where to put their money, at least seven will say the same thing: residential real estate. Not because it always performs best, but because it feels familiar.
What most investors quietly discover, usually after their first or second property, is that “people will always need housing” does not automatically translate to strong, reliable returns. In practice, residential rentals are slow, emotionally demanding, and far more fragile than they appear on spreadsheets.
This doesn’t mean residential projects are without value; it only means we could explore other options while we have that. Let’s look at why hospitality assets are the next goldmine.
The Comfort of Residential Property — and Why It’s So Persuasive
Residential real estate has a decisive psychological advantage. It mirrors how most people live. You rent a place. You stay for a while. You pay monthly or yearly. On the surface, that feels stable.
There are real perks. A good tenant who stays two or three years reduces turnover stress. Rent reviews are predictable. In some neighbourhoods, property values appreciate steadily over time. For investors with patience and deep pockets, residential rental properties can help preserve wealth.
But preservation and performance are not the same thing.
What many investors often fail to model properly is time. Time to find a tenant. Time to recover from the vacancy. Time to repair damage. Time to recoup capital. When you factor in time, honestly, the returns from residential investing often appear far less impressive.
Consider a common scenario in Lagos: a ₦60 million residential apartment generating ₦4.5 million in annual rent. On paper, that is a 7.5% gross yield. However, exclude agent fees, maintenance, periods of vacancy, repainting, plumbing repairs, generator issues, and tenant disputes. Suddenly, that yield compresses, sometimes dramatically.
More importantly, when the tenant leaves, the income does not decrease. It stops.
Residential vacancy is binary. You are either earning or you are not. There is no partial utilisation.
The Hidden Cost of “One Tenant, One Income”
Residential rentals concentrate risk in a way most investors underestimate. One household represents 100% of your cash flow. One disagreement, one job loss, one relocation decision, and the property becomes idle.
And idle property is expensive.
Mortgage payments (if any) continue. Security costs remain. Maintenance does not pause. In high-density cities like Lagos, even short vacancy periods can erase months of profit.
Then there is damage. Damage is usually discovered at exit, not gradually. It is rarely budgeted accurately. And it often comes after income has already stopped.
This is not because tenants are malicious. It is because residential use is intensive and emotional. People live, argue, cook, raise children, host guests, and improvise repairs. Wear and tear accumulate in unpredictable ways.
Now contrast this with a hospitality asset designed for short stays near a transport hub.
Why Hospitality Asset in Transportation Hubs?
Transport hubs, such as bus terminals, rail corridors, and arterial road junctions, concentrate on one thing above all else: movement.
Every day, tens of thousands of people pass through areas like Oshodi, Ojota, Jibowu, and major interstate corridors in Lagos. Among them are traders moving goods, corporate staff on short assignments, consultants, technicians, and business owners shuttling between cities.
These people are not looking for a neighbourhood to belong to. They are looking for a place to rest.
They need somewhere to sleep for a night. Somewhere to shower. Somewhere to answer emails. Somewhere close enough that traffic does not destroy their schedule the next morning.
This is what makes the demand non-optional.
A business traveller arriving late at night does not say, “I’ll come back next month.” They solve the problem immediately. The decision window is short. The need is urgent. The stay is brief and repeatable.
Why you should consider this
1. The Need is Higher and faster :
Hospitality assets near transport hubs do not depend on one person liking the property enough to stay for years. They rely on many people needing it for a brief period. That difference changes everything.
Instead of one tenant per year, you may have hundreds of guests. Instead of annual rent, you have daily revenue. Instead of waiting months to recover from a vacancy, demand is constantly available.
If one guest leaves, another arrives. Income does not drop to zero; it fluctuates within a range.
This is why hospitality assets near transportation hubs often recover more quickly from economic shocks. Even when discretionary spending drops, business travel does not disappear. It adjusts, compresses, and continues.
2. Lesser Damage :
Hospitality assets are not immune to wear and tear. But the nature of the damage is different.
Short-stay guests do not emotionally “settle” into a space. Usage is lighter, more standardised, and easier to monitor. Cleaning is frequent. Issues are spotted early. Maintenance becomes operational, not reactive.
Instead of one massive repair after a tenant exits, costs are spread out and priced into nightly rates. This predictability is one of the most overlooked advantages of hospitality-focused assets.
3. Capital Recovery is faster :
Because hospitality assets generate revenue daily, capital recovery is not tied to long lease cycles. Well-located hospitality properties often start cash flowing immediately after launch.
Even modest nightly rates, when multiplied by consistent occupancy, can outperform residential annual rent, especially when downtime is minimal.
This Is Not an Argument Against Residential Property
Residential real estate still has a place. It preserves value. It suits long-term, low-intervention investors. It works well in stable, low-movement neighbourhoods.
However, in high-traffic urban corridors, residential use often underutilises the value of the land. The exact location that feels “too noisy” for living can be perfect for short-stay hospitality.
Where Zimmr Comes In
Zimmr is not building hotels. And it is not building traditional shortlets.
What Zimmr is building deliberately sits at the intersection of movement, affordability, and functionality, with hospitality assets explicitly designed for business travellers who need a place close to a transportation hub.
By focusing on transport-adjacent locations and short-stay demand, Zimmr aligns real estate with how people actually move through Lagos, not how we wish they did.
For investors, this means exposure to:
- High-frequency demand
- Faster cash-flow cycles
- Distributed risk
- Assets designed for use, not speculation
If you are exploring investment opportunities in infrastructure-backed hospitality assets that respond to real demand patterns, Zimmr is building exactly that. Learn more about investing in what Zimmr is building.
