Too Expensive to Build: Lagos, Lusaka, 5 others with the Highest Cost of Commercial Building Construction in Africa

The influence of world economic crises, such as the post-COVID-19 and the Russia-Ukraine war, have influenced the cost of construction in Africa. According to the International Construction Market Survey (ICMS) conducted by Turner and Townsend, these have immensely influenced the African market.

Although the continent showed significant recovery, the report notes that the construction sector is yet to fully recover. The industry struggles with the increase in construction costs due to supply-chain bottlenecks. The Director of Turner & Townsend,  Bruce Haswell, said, “In our 2022 survey results, there are 38 markets that suggested they experienced inflation of 10% or more.

Rising building material costs have been one of the key drivers of higher construction cost inflation over the last 12 months. Global supply-chain disruptions, high commodity prices, higher shipping costs, and supply shortages have caused this strong price growth.”

This saw the construction costs of commercial and retail buildings in African cities, according to Statista, increase, with Lagos and Accra topping the chart. Using three parameters (Standard offices high-rise, Prestige offices high-rise, and Major shopping centre), Statista analysed selected cities in Africa with the highest cost of construction.

Lagos, Nigeria

Bruce Haswell, during his keynote speech at the 2022 Real Estate Discussions and Awards by Thinkmint Nigeria, said that Lagos state is the most expensive place to build in Africa at $2,056 per square meter (m²).

While Lagos leads the chart in Africa internationally, it is the 56th most expensive city to build in compared to the 88 cities that were surveyed. From the released report, the Standard offices in Lagos cost $2,600 per m² while Prestige offices and major shopping centres cost $3,800 per m² each.

Accra, Ghana

Accra, the capital of Ghana, took second position after Nigeria. From the provided data, Accra has $1,800 per m² for Standard offices, $2,600 per m² Prestige offices and  $1,500 per m² major shopping centres.

Apart from inflation being one of the factors, others, such as exchange rates, global demand, import duties and supply, contributed to the increase in the cost of construction. In Ghana, about 80% of its construction materials are imported.

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Lusaka, Zambia

In 2019, Zambia had the highest cost of construction in Africa. In an interview, Joseph Chikolwa, the Zambia National Building Society Managing Director, said that this contributes to the current housing deficit, which makes citizens unable to buy cheaper building materials.

This year, the country still has one of the cities in Africa with one of the highest construction costs. The city ranks third with $1,800 per m² for Standard offices, $2,400 per m² Prestige offices and  $2,200 per m² major shopping centres.

Kigali, Rwanda

According to the 2017 report from Turner & Townsend, Kigali has the highest construction cost in Africa, with a $1,117.12 per m² cost. Compared to 2022, Kigali ranks third with a $1,700 per m² for Standard offices, $2,000 per m² Prestige offices and  $1,500 per m² major shopping centres.

Kampala, Uganda

According to the International Construction Market Survey (ICMS), in 2017, in commercial property, business-type office space cost $879 per m² while medium A-grade CBD offices of up to 20 cost $930 per m². However, premium high-rise offices in the CBD of Kampala cost $1389. Among Kenya, Tanzania and Uganda, the survey showed that Uganda’s construction cost was the most expensive.

From the Statista report, Uganda ranks fifth with its Standard offices’ high-rise cost at $1,400 per m², Prestige offices’ high-rise cost at $2,300 per m², and major shopping centres cost $1,100 per m².

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