Nkiruka Evangeline Obi-Aso
Department of Estate Management, Nnamdi Azikiwe University, Awka, Anambra, Nigeriahttps://doi.org/10.47191/jefms/v4-i7-10
Performance of FDI in commercial real estate in Nigeria when compared to international benchmark figures is yet to be established and documented in literature. The aim of the study was to appraise the performance of FDI in commercial real estate in Nigeria from 2006 to 2017 in a bid to empirically assist foreign direct investors’ decisions on investing in the Nigerian commercial real estate sector. The objectives were to; ascertain and compare returns from foreign direct investments in commercial real estate in Nigeria with international benchmark; and to examine how FDI tax responsibilities in Nigeria compare with the global benchmark rate. The study adopted ex post facto research design, and the unit of analysis was selected foreign controlled commercial real estate investments in Lagos and Abuja. The study adopted the Jones Lang LaSalle benchmark settings for commercial real estate performance indicator due to its empiricism from an international perspective where yield is 5.7%, capital growth is 7% and rental growth is 5.5%. Data were collected on rental values, capital values, tax responsibilities, and was analyzed using T-test. The study showed a yield of 4%, (t = 6.364; p < 0.05) and a capital growth rate of 21%, (t = 1.592; p > 0.05), while there was no negative variation in FDI tax responsibilities in Nigeria and international benchmark rate cap of 30% (t = .8666; p > 0.05). The study recommended that property managers should practice tenant mix and flexible leases and spaces.
Commercial Real Estate, FDI, Real Estate Performance Benchmarking, Real Estate Returns
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