ANALYSIS OF DIRECT AND INDIRECT PROPERTY INVESTMENT PERFORMANCE IN ABUJA, NIGERIA

Purpose: The study aims at analysing the performance of direct and indirect property investment in Abuja, Nigeria, with a view to determining the most performed investment option.

Design/methodology/approach: To achieve this aim, the study analysed longitudinal data collected from registered estate surveying and valuation firms in Abuja using simple random techniques and 150 rental and sale transactions between 2011 and 2024 were retried and analysed. The study employed descriptive techniques, including the holding period of return (total return), risk-return analysis, and risk-adjusted returns.

Findings: The results revealed that indirect property investment was found to be more volatile but offered attractive returns with higher risk. However, direct property investment returns were found to be less volatile and offered lower but stable and comparable returns. The result further revealed that, based on risk-return analysis of direct and indirect property investment, direct property investment outperformed indirect property investment; however, based on risk-adjusted return, indirect property investment performed better than direct property investment.

Research limitations/Implications: The limitations include the use of only direct office property investment and the use of United Property Development Company (UPDC) share returns.

Practical implications: A risk-neutral investor could leverage direct property investment performance attributes over indirect property investment, while a risk lover's investor could take advantage of indirect property investment based on its risk-adjusted content.

Originality/value – The study revealed the 41% (0.41) and 46% (0.46) risk per unit of investment for direct and indirect property investment, respectively. The study revealed 41% (0.41) and 46% (0.46) risk-adjusted risk to return ratios for direct and indirect property investment, respectively.