An Assessment of Strategic Management Practice in the Leasing of Commercial Properties in Nairobi CBD, Kenya

Abstract

Long term wealth is the main motivating factor in commercial real estate investment. Leasing plays a major role in commercial properties long term planning in achieving targeted cashflows and the subsequent returns. Inefficient property management practices have been concluded as leading to diminishing property returns. The lack of strategic direction and therefore key performance indicators leads to little or no value addition thus the casual treatment of the property management profession. The objectives of the study included To establish the conventional tools of strategic management practice applicable to leasing of commercial properties; determine the extent of applicability of the tools of strategic management practice in leasing of commercial properties within Nairobi CBD; determine the constraints on the practice of strategic property management in the leasing of commercial properties within Nairobi CBD; and design a strategic management framework for the leasing of commercial properties within Nairobi CBD. The research was confined to Nairobi CBD due to the fact that the city centre presents a mature real estate industry in terms of reviewing strategic property management services. The sample consisted of 35 buildings randomly selected from this target population of 421 commercial buildings in Nairobi CBD as identified in a field study by the author. The sampled buildings within the Nairobi CBD were randomly selected using a google map with satellite aerial images of commercial buildings. The CBD for the purposes of this study was hereby defined as the area between University Way, River Road, Haile Selassie Avenue and Uhuru Highway. This study involved the use of a semi-structured questionnaire which was administered to managers of commercial properties within Nairobi CBD. The questionnaires contained open and close-ended questions for the purpose of collecting primary data. Secondary data was acquired from real estate journals, unpublished scholarly works and published text books. Data analysis was conducted using SPSS and MS Excel. The descriptive statistics utilized in the study included the mean, frequencies, standard deviation, minima and maxima. Z-test was additionally carried out on the data. Data collected and analysed was represented in form of tables and figures...