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Determinants of Investment Decisions on Uptake of Commercial Properties: A Case of Westlands Area in Nairobi – Kenya

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dc.contributor.author Hassanali, Juzer Yunus
dc.date.accessioned 2019-07-22T07:08:44Z
dc.date.available 2019-07-22T07:08:44Z
dc.date.issued 2019
dc.identifier.uri http://erepo.usiu.ac.ke/11732/4621
dc.description A Research Project Report Submitted to the Chandaria School of Business in Partial Fulfillment of the Requirement for the Degree of Master of Business Administration (MBA) en_US
dc.description.abstract This study sought to examine the determinants of investment decisions on the uptake of commercial properties in Westlands area in Nairobi – Kenya. This study set to determine the impact of prices on the uptake of commercial properties within Westlands area in Nairobi – Kenya, establish the impact of econometric factors on the uptake of commercial properties within Westlands area in Nairobi – Kenya, and determine the challenges facing investors on the uptake of commercial properties within Westlands area in Nairobi – Kenya. This study adopted a descriptive research design that enabled the study findings to be generalized to the larger population. The population was 50 commercial real estate landlords that operated in Westlands - Kenya. The sample frame was obtained from onsite building managers working in Westlands - Kenya. The study applied a census sampling technique; thus, the sample size were 50 commercial real estate landlords that operated in Westlands - Kenya. A questionnaire was developed by the researcher based on the specific objectives of the study for data collection. A pilot test was done using ten respondents. Later, the refined questionnaires were distributed in person by the researcher to determine the target population. The data analysis methods that were used in the study were descriptive and inferential analysis. Descriptive analysis involved measures of central tendency (percentages, means and standard deviations). Inferential analysis involved correlation and regression analysis, and the study results were presented in the form of tables and figures. The study revealed that prices are determined by market conditions and price changes are related to changes in macroeconomic variables. Loans are not the largest flow of investment capital since mortgage loans are illiquid and indivisible. Interest rate determines the lenders interest income on assets while credit risk carries the potential for bankruptcy since credit risk in mortgages involves the risk of defaulting, thus, potential losses create significant burdens for financial institutions, however, as lenders they are not reluctant to grant mortgage loans. The study indicated that the rate of employment is not directly related to office rent even though, econometric factors affect savings and investment power. The building’s appeal has a close relation with its rental market performance and its occupancy is lured by the physical appeal. Property location has an effect on its market value and rent, for instance, proximity to complementary business and support services are valuable inputs to property uptake. A lease defines the privileges of tenants and landlords and lease options influence the tenant’s decision of space occupation. The study showed that developers in the country do not face restrictions to raise money for development, however, the real estate business has the potential to bring unpredictable losses. There are laws in place governing the real estate market, and the economic climate of a region affects the decision to invest. For instance, stringent mortgage demands impact supply. The study revealed that population growth is not a great challenge to real estate industry. The study concludes that rental value is based on comparable leases and a well-drawn rent review clause affects the uptake of commercial properties. It also concludes that, security is considered by investors when making investment decisions, since real estate investment requires huge capital injection, and the laws of nature dictate the conceivable uses of real estate. This shows that price and econometric factors are significant to real estate uptake. The study recommends all landlords to improve on their skills necessary to manage the complex risks associated with finances. This would facilitate their ability to create financial related securities that would provide them multiple instruments by which they can access finances en_US
dc.language.iso en en_US
dc.publisher United States International University - Africa en_US
dc.subject Commercial Properties en_US
dc.subject Westlands Area en_US
dc.subject Nairobi – Kenya en_US
dc.subject Investment Decisions en_US
dc.title Determinants of Investment Decisions on Uptake of Commercial Properties: A Case of Westlands Area in Nairobi – Kenya en_US
dc.type Thesis en_US


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