Hostel Development for University Students: One sure way of making money in real estate

Recently I was passing through the university of Lagos and saw an undergoing project of several rooms student hostel to be completed this year for the next academic session , and I remembered how smart investors were making cool money off us then in my days in Ambrose Alli University, Ekpoma.
The potential here can not be underestimated considering the need and serious growth of student population numbers, already many of the institutions lacks adequate classrooms,studios,laboratories, library not to talk of hostel facilities. Unavailability of these facilities is the major reason parents prefers one higher institution to the other for their wards to pursue academic excellence.
Overcrowding and overpopulation of these hostels had made the government to come up with new policies that will encourage private investors to own and run hostels.
A lot of nigerian banks are now involve in it, for example spring bank ,zenith bank etc are now having stakes in some of the institutions.
However, this problem is not peculiar with the universities alone, you can also be thinking towards investing in these places:
Polytechnics, both federal and state, colleges of education,technical colleges, teachers trainning .

Advantages of this investment
Very High rates: No matter the place be it rural or urban ,institutions generate a lot of traffic especially in on session periods.
the rush for hostels make the rent to be higher than most urban areas with the same square meter area of rooms.
Quick returns on investment: Student pays in yearly basis so you have money in lump sum that you can easily use to build or add one more room to the existing ones you have which you can easily rent out again to build more.
The high rate of growth is noticeable mostly in these areas.
No owing of rent: Your contract with students is usually on yearly basis which terminates at the end of every session, you are paid before new tenants comes in unless the present occupier can afford to pay you new rates which are usually added almost every year.the student sojourn is always short and transitory which makes it easy for you to increase your rent after he must have packed out.
For potential investors, there are two options through which they can participate. One is by going into partnership arrangement with one or more tertiary institutions to obtain land under leasehold agreement:build and manage the hostel on agreed terms.
Two, speculate for land around tertiary institutions, obtain necessary titles and approvals from government agencies,build and then manage the hostel.

What you should know and do
-You don’t need to be a building contractor or a professional to get this done for you,
-You don’t need any government connection to do it
-It must not always be in the school premises, but should at least be in the town or close to the school, the closer it is, the higher the rate.
-You do not need to start with millions to build mega houses, you can start with small rooms (2,3 or 4) in an half plot of land then grow steadily to build bigger ones in the institutions scattered all over the nation.
But if you must start big, you need to be credit worthy, banks, mortgage and other financial institutions can collaborate and assist.
-Just identify the locations of the various higher institutions.

An architect with decades of experience

10 Comments

  1. Very informative submit, love the way you write and I believe that the information helps in a way. I don’t normally say this, but I think this is a nice job done. In case you like to change hyperlinks, I might be very happy to supply a hyperlink again to your site. Hope to listen to from you soon. Cheers

  2. I have for sale, 2 plots of virgin land together and very close to Anambra State University, Uli, Anambra State. Asking Price: N1.5 Million each O.N.O. Very suitable for Students’ hostels, school, bank, eatery, etc. Clean title. If interested, contact me on 080-3307-9388 or e-mail: ibegbuemma@yahoo.com

  3. thanks this is wonderful iam also in line of developing one hostel in uganda, it has been nice reading from your site

  4. ARC OMION, YOU ARE DOING A WONDERFUL WORK HERE. I PRAY THAT GOD SHOULD CONTINUE TO GIVE YOU WISDOM AND BLESS THE WORK OF YOUR HAND,IN JESUS NAME. DOUBLE PORTION!

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