Examining Land Value Capture Mechanisms and Their Potential for Urban Infrastructure Financing in Nigeria

Land value capture instruments, which redirect infrastructure-induced land value increases from private landowners to public authorities, represent a potentially significant source of urban infrastructure financing in Nigeria. This study empirically examines the potential and existing practice of land value capture mechanisms in three Nigerian urban contexts: Lagos, Abuja, and Kaduna. Using a mixed-methods analytical design, the study estimates infrastructure-induced land value increases around recent transport and amenity investments using spatial difference-in-differences analysis of property price data from estate agency records spanning 2017 to 2023. Institutional analysis of existing land value capture provisions in Nigerian legislation including the Land Use Act, the CAMA, and state urban development laws was conducted. Interviews with 20 planning finance officials, real estate economists, and legal experts assessed political feasibility and design considerations for value capture implementation. Findings are expected to demonstrate substantial land value increments around BRT corridors in Lagos, FCDA infrastructure investments in Abuja, and industrial infrastructure in Kaduna, suggesting considerable untapped revenue potential. The study identifies the legal and institutional framework modifications needed to operationalize value capture. Recommendations propose piloting of betterment levies around defined transport infrastructure investment areas, reform of the property rating system to capture development gains, land readjustment mechanisms for large-scale redevelopment areas, and a legislative amendment package to enable value capture at state level. Keywords: Land value capture, Infrastructure financing, Urban planning, Nigeria, Property taxation.