Property Portfolio Performance and Management Practice in Lagos Metropolis: An Empirical Study.
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Date
2009-03-01
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Faculty of Environmental Design and Management, Obafemi Awolowo University, Ife
Abstract
This paper against the background of increasing challenges to property portfolio management practice in Nigeria property market, examined the whole gamut of property portfolio management as currently practiced by estate surveyors in Nigeria. This was with particular reference to the methods being used in property portfolio management practice and the performance of properties under management.
The study administered questionnaires on 75 practicing estate surveyors and 150 property owners, the sample sizes of which were selected through purposive sampling having stratified the study area into five zones. The total response for the managers and the property owners were 44(59%) and 76(51%) respectively. Statistical tools employed in analyzing data on management practices were frequency distribution and percentages as well as mean and standard deviation of all respondents rankings for each factor considered. The results of the measure of property portfolio (34 in all) performances by internal rate of returns (IRR) were analyzed using the mean of returns measure, standard deviation of returns, Sharpe (1966) Index, and the differential return measure.
The study revealed that, it is the traditional property management practice that was given prominence in the study area. The results showed that, on mean return basis, 21 (62%) of the 34 measured portfolios performed above the targeted (Treasury bill) rate of 14.38% and that property returns exhibited little variations for the period of measurement. However, out of the 34 measured portfolios across the zones, only nine (9) (26%) of the managers showed better performance in their respective zones. The results concluded that the current practice is less able to cope with the dynamism which today’s property market demands.
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Keywords
Property portfolio, Manager, Management practice, Performance