Radisson Hotel Project in Edo Sparks Debate Over Debt, Equity, and Investment Climate

The ongoing review of the Radisson Hotel project in Edo State has ignited a heated exchange between the current administration and the Peoples Democratic Party (PDP), highlighting the complexities of public-private partnerships and the broader implications for investment in Nigeria’s tourism and hospitality sector.

At the heart of the controversy is the state government’s disclosure that it is currently servicing a monthly Irrevocable Standing Payment Order of N385 million for the Radisson Hotel project. According to Kassim Afegbua, Edo’s Commissioner for Information and Strategy, this financial obligation stems from a N25 billion capital market facility secured by the previous administration under Governor Godwin Obaseki. The commissioner emphasized that this liability has prompted a comprehensive review of the transaction, including the underlying agreements and the structure of the project’s equity arrangement.

Mr. Afegbua expressed concern that, despite the state’s substantial financial exposure, a private investor reportedly holds 80 percent equity in the project, while the state retains only 20 percent. He noted that preliminary records indicate the state raised the initial N25 billion and began the project before introducing a private investor. The commissioner questioned the clarity of the private investor’s financial contribution prior to the equity restructuring and pointed out the absence of evidence for a competitive bidding process. He stressed that the review is not politically motivated but is focused on transparency, due process, and accountability in public finance management. The review also extends to other inherited projects, such as the Museum of West African Art, with the aim of determining the state’s financial obligations, liabilities, and benefits.

In response, the PDP in Edo has described the state government’s comments as “misleading and politically motivated,” characterizing them as part of a “desperate smear campaign” against the Obaseki administration. Dan Osa-Ogbegie, the PDP’s state Publicity Secretary, asserted that the Radisson Hotel project was a properly structured public-private partnership (PPP). He explained that the state’s N2 billion contribution served as seed equity to de-risk the project and attract credible private capital. Additional funds, including portions of bond proceeds, were reportedly deployed as loans to a Special Purpose Vehicle (SPV) established for the project, with clear repayment obligations tied to the hotel’s future operations.

The PDP spokesperson dismissed claims that the hotel was sold cheaply or transferred to political cronies, insisting that at no point did former Governor Obaseki have any direct or indirect ownership interest in the hotel. He further argued that the state’s investment had already appreciated significantly, even before the hotel commenced operations, describing this as evidence of strategic, long-term economic planning. The PDP maintained that the financing structure—combining project-finance loans, equity contributions, and asset-backed repayment mechanisms—reflects standard global practice in modern infrastructure development. The party warned that repeated public attacks on investors could undermine Edo State’s credibility and deter much-needed capital, questioning how such actions would create jobs or improve livelihoods for the state’s youth.

This dispute comes at a time when the tourism and hospitality sector in Nigeria, and across Africa, is increasingly reliant on innovative financing models and public-private partnerships to deliver large-scale projects. The Radisson Hotel project, with its blend of state and private investment, is emblematic of the challenges and opportunities facing African destinations seeking to upgrade their infrastructure and attract international brands. The debate over equity, transparency, and the role of government in such ventures is likely to shape future investment strategies, not only in Edo but across the continent.

For Africa’s tourism industry professionals, the situation in Edo offers important lessons. The need for clear governance, competitive bidding, and transparent equity arrangements is paramount to building investor confidence and ensuring that public resources are used effectively. At the same time, the ability to communicate the benefits of development finance and PPPs to the public is crucial for sustaining support for ambitious projects that can drive economic growth and job creation.

As the review of the Radisson Hotel project continues, the current administration has pledged to act within the law, including engaging regulatory and anti-corruption agencies if necessary. The PDP, meanwhile, has vowed to defend what it sees as a record of fiscal discipline and investment-led growth under Obaseki, urging residents to focus on results rather than rhetoric.

The outcome of this debate will be closely watched by stakeholders across Africa’s travel and hospitality sectors, as it may set new precedents for how large-scale tourism investments are structured, managed, and communicated in the years ahead.