The transformation of Africa’s digital ecosystem rests not only on internet access but on the strength of its underlying infrastructure. These infrastructures ensure that the digital rails that help people run their businesses, trust content and go about almost every aspect of life are safe, effective and accessible. In an era of rapid digitisation, the physical structures that facilitate the effective transmission, storage, and processing of data situate data centers as critical requirements in meeting the exponential growth in data usage. They are crucial to the operations of financial institutions, e-commerce players, AI developers, and governments as these institutions gradually migrate operations to the cloud. The localisation of data storage and computing in Africa has become imperative as internet penetration deepens and demand for cloud computing and AI services gain traction.
Lagos, Nigeria’s commercial capital, ranks third in Africa by number of data centres (13), behind Johannesburg (31) and Nairobi (15). According to Arizton Advisory & Intelligence’s latest Nigeria Data Centre Market Research, Nigeria hosts a total of 16 operational data centres, valued at $278M in 2024, with an estimated load capacity of 136.7MW. Of these 16, Lagos is home to 13 – 10 of which are concentrated in Victoria Island, Lekki, and Eko Atlantic, likely accounting for approximately $226M of the current market value. By 2030, the country’s data centre market is projected to grow to $671M, with a load capacity expected to climb to 279.4MW.
Amazon Web Services (AWS), Google Cloud Platform (GCP), and Microsoft’s Azure Platform are key drivers to this growth, with their presence underscoring the city’s strategic importance and the rising demand for local hosting capacity to ensure compliance, latency, and data sovereignty requirements. Today, Lagos has become the landing point for several subsea fibre optic cables. In 2024, 2Africa – a consortium of 8 members including Meta landed the world’s longest submarine cable at Mopo-Onibeju Lekki, Lagos. The 45,000km-long cable is planned to link 33 countries across Africa, the Middle East, Europe, and South Asia. It joins an extensive subsea cable system that includes MainOne, African Coast to Europe (ACE), Glo-1, Equiano by Google, West Africa Cable System (WACS), Nigeria-Cameroon Submarine Cable System (NCSCS), and SAT-3/WASC.
The spread of subsea cables has catalysed internet speed & affordability for businesses and consumers, though some contend that broadband costs remain high. This infrastructure underpins Lagos’ capacity to host data centres at scale, attracting investors who are drawn to the city’s proximity to submarine cable landing points, access to coastal water resources for colling systems, and rapid urbanisation. Prominent facilities include 20MW MDXi (a subsidiary of MainOne, now Equinix), Open Access Data Centres (OADC) Lagos LOS1 (1.5MW), Rack Centre LGS 2 (12MW), Rack Centre LGS 1 (1.5MW), and Africa Data Centres (10MW). Key projects in the pipeline include Kasi’s 5MW centre, OADC’s planned expansion to a 24MW capacity, and Bharti Airtel’s 35MW Nxtra facility, all expected by 2027.
With just 16 operational data centres – including colocation facilities, Nigeria accounts for about 8% of Africa’s total of 198 – just 1% of the global data centre capacity. Telecom operators and cloud providers are identifying opportunities and investing in colocation and hyperscale facilities to bridge the nation’s digital infrastructure gap. Colocation centres – akin to the shared economy model, have become a key revenue engine in the data centre market, providing digitally driven businesses with the opportunity to lease rack space and scale their operations without huge upfront capital costs. These colocation centres offer cooling systems, power, internet connectivity, and security. With this, businesses can deploy their own servers in a controlled environment.
For real estate investors, the implications of this evolving market are clear. The Lagos data centre market is seeing strong growth, driven by fintech, cloud adoption, and AI, creating long-term demand for power-secure, strategically located real estate. While major players are expanding, supply has not yet outpaced demand, and the market remains tilted toward owner-built facilities rather than leasable space. As such, investors are better off providing land or delivering custom-fit spaces near infrastructure hubs such as power substations and undersea cable landing points. The opportunity lies in land banking and build-to-suit developments rather than speculative leasing.
As Nigeria’s digital economy grows and enabling policies take shape, both government and private sector execute their digital plans, driving demand for locally hosted, secure, and scalable infrastructure. With its deepening subsea connectivity, Lagos is positioned to become a leading digital hub in Africa.