ANALYSIS OF TRENDS IN COMMERCIAL REAL ESTATE RETURNS IN NORTH-CENTRAL NIGERIA

Purpose: This study analysed the trend in commercial real estate returns in North-central Nigeria with a view to identifying nature of historical returns on office and shop property investment over a period (1999-2025).

Design/methodology/approach: The study analysed 256 and 219 office and shop properties transactions respectively selected using simple random sampling techniques. Descriptive statistics such as holding period of return (HPR), trend analysis and coefficient of variation were employed to analyse the data collected for the study. The study also utilised inferential statistics, analysis of variance (ANOVA).

Findings: The result of trend analysis revealed that returns exhibited more rising trend than falling trend in Abuja and Ilorin while Jos and Makurdi experienced more falling in trend that rising over the period of study. Furthermore, the study found that office market trend exhibited less risk and performed better than shop market over the years based on the coefficient of variation results. The result of analysis of variance revealed that returns in office investment was significantly differed from returns on shop investment, and office return had a stable rising trend than shop returns.

Research limitations/Implications: The limitation of the study involved the use only North-central commercial real estate office and shop markets in Nigeria. The research implication is that, the study has contributed to knowledge by providing informative insights from commercial real estate market situation which served as guide to real estate investment decisions.

Practical Implications: The study provided a guide for commercial real estate investor in making investment decision while choosing among investment options such as office and shop. Also, while choosing among investment locations in North central areas of Nigeria, failure to adhere to this informative guide might lead to loss of investment.

Originality/value: The study revealed that returns on commercial office property investment had a stable trend and performed better than shop property investment in Abuja and Ilorin than Jos and Makurdi within the stated period.