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The Costs Involved in Building a Standard Hotel in Nigeria

The Costs Involved in Building a Standard Hotel in Nigeria

Unveiling the Costs Involved in Building a Standard Hotel in Nigeria

Nigeria’s hospitality industry is experiencing rapid growth, driven by an increase in tourism and business activities. Aspiring hoteliers looking to tap into this lucrative market often face the challenge of estimating the costs involved in building a standard hotel.

Proper financial planning is crucial for the success of any hotel project. In this article, we will explore the various factors that influence the cost of building a standard hotel in Nigeria, providing aspiring hoteliers with valuable insights and a comprehensive guide.

Building a Standard Hotel in Nigeria

Factors Affecting the Cost of Building a Standard Hotel in Nigeria

  • Location

The location of the hotel is a primary determinant of construction costs. Urban areas, particularly major cities and tourist destinations, tend to have higher land prices. Additionally, the location can affect the availability and cost of construction materials and labor.

  • Land Size and Zoning

The size of the land required depends on the scale of the hotel project, the number of rooms, and the amenities planned. Zoning regulations must also be considered, as certain areas may have specific requirements and restrictions that impact construction costs.

  • Hotel Classification and Amenities

The classification and amenities of the hotel significantly influence construction costs. Higher-end hotels with more luxurious amenities, such as swimming pools, fitness centers, restaurants, conference rooms, and spa facilities, generally have higher construction costs compared to budget or mid-range hotels.

  • Architectural Design and Layout

The architectural design and layout of the hotel also play a vital role in determining the construction costs. Complex designs, unique features, and innovative structures may require specialized expertise and increase construction expenses.

  • Building Materials and Quality

The choice of building materials and the desired quality of construction impact the overall cost. Different materials, such as concrete, steel, glass, or wood, have varying costs. Opting for high-quality materials and finishes will naturally incur higher expenses.

  • Labor and Construction Management

Skilled labor is essential for the successful construction of a hotel. The cost of labor can vary based on location, labor availability, and market conditions. Additionally, hiring a competent construction management team to oversee the project ensures smooth execution and timely completion.

  • Permits, Approvals, and Legal Fees

Obtaining the necessary permits, approvals, and licenses from local authorities involves legal and administrative fees. These costs should be factored into the overall budget.

Estimating the Cost


To provide a rough estimate, let’s consider building a standard hotel with 50 rooms, including basic amenities such as a restaurant, gym, and conference facilities. Please note that the costs provided here are approximate and can vary based on location, design, and individual preferences.

  • Land

The cost of land in prime locations can range from ₦50,000 to ₦150,000 per square meter. For a 2,000-square-meter plot, the cost can range from ₦100,000,000 to ₦300,000,000.

  • Construction

The cost of constructing a standard hotel can range from ₦300,000 to ₦500,000 per square meter, depending on the quality of materials and finishes. Assuming an average cost of ₦400,000 per square meter, the total construction cost would be approximately ₦800,000,000.

  • Architectural and Engineering Fees

These fees typically range from 5% to 10% of the construction cost. Assuming 7% of the construction cost, architectural and engineering fees would amount to ₦56,000,000.

  • Permits, Approvals, and Legal Fees

These fees can vary significantly based on location and project complexity. A rough estimate would be around 2% to 5% of the construction cost, amounting to approximately ₦16,000,000.

FF&E costs depend on the desired quality and style. A general estimate is around 20% to 30% of the construction cost. Assuming 25%, FF&E expenses would amount to ₦200,000,000.

  • Contingency

It is advisable to set aside a contingency fund of around 5% to 10% of the total project cost to account for unforeseen expenses. Assuming 7%, the contingency fund would be approximately ₦101,000,000.

Overall, the estimated cost of building a standard hotel with 50 rooms in Nigeria would range from ₦1,273,000,000 to ₦1,473,000,000.


Building a standard hotel in Nigeria requires meticulous planning and a thorough understanding of the costs involved. Factors such as location, land size, hotel classification, amenities, architectural design, building materials, labor, and legal requirements significantly impact construction costs.

By conducting comprehensive research, seeking expert advice, and creating a detailed budget, aspiring hoteliers can navigate the complexities of the construction process and embark on a successful venture in Nigeria’s thriving hospitality industry.

Frequently Asked Questions

The Costs Involved in Building a Standard Hotel in Nigeria

1. What is the average cost of building a standard hotel in Nigeria?

The cost of building a standard hotel in Nigeria can vary significantly depending on factors such as the location, size, quality of materials, level of finishes, and the specific design and amenities of the hotel. It is challenging to provide an exact average cost without considering these variables. It is recommended to consult with a professional architect or construction expert who can provide a more accurate estimate based on your specific requirements.

2. How long does it take to build a standard hotel in Nigeria?

The construction timeline for a standard hotel can vary depending on factors such as the size of the hotel, the complexity of the design, the availability of labor and materials, and the efficiency of the construction process. Generally, it can take anywhere from 12 to 24 months or more to complete the construction of a standard hotel. It is advisable to work closely with your architect, contractor, and project manager to establish a realistic timeline based on your specific project.

3. What are the main cost components involved in building a hotel?

The main cost components involved in building a hotel include the following:

  1. Land acquisition: The cost of purchasing or leasing land for the hotel.
  2. Construction and labor: The cost of materials, labor, and equipment required for the construction of the hotel.
  3. Architectural and design fees: The fees associated with hiring an architect or design team to create the hotel’s plans and specifications.
  4. Permits and regulatory fees: The costs associated with obtaining necessary permits and complying with regulatory requirements.
  5. Interior design and furnishings: The cost of furnishing the hotel rooms, common areas, and amenities.
  6. Utilities and infrastructure: The expenses related to connecting the hotel to utilities such as water, electricity, gas, and sewage systems.
  7. Technology and systems: The cost of installing technology systems such as Wi-Fi, security, and communication systems.
  8. Landscaping and exterior amenities: The cost of outdoor landscaping, parking areas, swimming pools, and other amenities.
  9. Contingency and unforeseen costs: A contingency budget is usually allocated to cover unexpected expenses or changes during construction.

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