Harnessing real estate investment through proper tenant selection in Nigeria

Harnessing real estate investment through proper tenant selection in Nigeria Purpose – The main objective of investment in real estate is to derive adequate returns from its management; selection of suitable tenants is one of the challenges to attaining this in Nigeria. Many prospective tenants of residential properties usually appear good at the recruitment stage but often become belligerent with grave challenge to the property managers. The paper aims to examine the criteria set by property managers in selecting residential tenants in Nigeria with a view to establishing a proper process for identification of potentially bad tenants at the recruitment stage. Design/methodology/approach – The paper opted for an exploratory study with questionnaires administered to estate surveyors (professional property managers in Nigeria). Respondents were randomly selected based on Bartlett et al. 's model with margin of error set at 0.05, p =0.5, and t ‐value=1.96. Relative importance index analysis of the data was carried out to determine the ranking of the criteria. Findings – The paper provides insight into tenant selection through proper process using a weighted scorecard. It suggests that an application of a scorecard will reduce the incidence of bad tenancy and enable investors to derive value from investment in real estate. Research limitations/implications – The framework of tenant selection process adopted was based on criteria set by the respondents; researchers are therefore encouraged to test the applicability of the suggested weighted scorecard. Practical implications – There are implications for development of computer software using the weighted scorecard to further ease the process of tenant selection and make it an inter‐disciplinary study. Originality/value – This paper identified the need for proper tenant selection to enable investors in residential property to harness adequate and remunerative return. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Property Management Emerald Publishing

Harnessing real estate investment through proper tenant selection in Nigeria

Property Management, Volume 29 (4): 15 – Aug 16, 2011

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Publisher
Emerald Publishing
Copyright
Copyright © 2011 Emerald Group Publishing Limited. All rights reserved.
ISSN
0263-7472
DOI
10.1108/02637471111154827
Publisher site
See Article on Publisher Site

Abstract

Purpose – The main objective of investment in real estate is to derive adequate returns from its management; selection of suitable tenants is one of the challenges to attaining this in Nigeria. Many prospective tenants of residential properties usually appear good at the recruitment stage but often become belligerent with grave challenge to the property managers. The paper aims to examine the criteria set by property managers in selecting residential tenants in Nigeria with a view to establishing a proper process for identification of potentially bad tenants at the recruitment stage. Design/methodology/approach – The paper opted for an exploratory study with questionnaires administered to estate surveyors (professional property managers in Nigeria). Respondents were randomly selected based on Bartlett et al. 's model with margin of error set at 0.05, p =0.5, and t ‐value=1.96. Relative importance index analysis of the data was carried out to determine the ranking of the criteria. Findings – The paper provides insight into tenant selection through proper process using a weighted scorecard. It suggests that an application of a scorecard will reduce the incidence of bad tenancy and enable investors to derive value from investment in real estate. Research limitations/implications – The framework of tenant selection process adopted was based on criteria set by the respondents; researchers are therefore encouraged to test the applicability of the suggested weighted scorecard. Practical implications – There are implications for development of computer software using the weighted scorecard to further ease the process of tenant selection and make it an inter‐disciplinary study. Originality/value – This paper identified the need for proper tenant selection to enable investors in residential property to harness adequate and remunerative return.

Journal

Property ManagementEmerald Publishing

Published: Aug 16, 2011

Keywords: Property management; Selection of tenants; Estate surveyors; Bad tenants; Arrears of rent; Real estate; Investments

References

  • Environmental preferences of homeowners: further evidence using the AHP method
    Bender, A.; Din, A.; Hoesli, M.; Brocher, S.
  • Decision Making for Leaders
    Saaty, T.L.

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