Rising demand for commercial properties and hotel rooms in Nigeria has shifted investors' focus away from residential property developments, as they react to emerging trends, reports Business Day.

An increase in business activities due to the recovery of the economy is creating a huge demand for office and retail space, and hotel accommodation.

Estate manager Chudi Ubosi, in an interview with BusinessDay, says there is a huge short fall in commercial real estate, particularly in hotel accommodation. There has been a spike in the number of investments in this area, as investors move to cash in on higher returns.

Another factor prompting investors to move away from residential developments is the drastic reduction in lending to the real estate sector. Banks currently tend to favour high end commercial developments.

Dave Oguejiofor of Capital Alliance Property Investment Company (CAPIC), says the current boom in the hotel industry, which is driven by the recovery of the economy means hotels will need to increase their capacities.