IIARD International Institute of Academic Research and Development

INTERNATIONAL JOURNAL OF ECONOMICS AND FINANCIAL MANAGEMENT (IJEFM )

E-ISSN 2545-5966
P-ISSN 2695-1932
VOL. 6 NO. 2 2021

---

Acquisition Cost and the Performance of Real Estate Investment in Nigeria: A Panel Data Approach

Okore Amah Okore, PhD

---

Abstract

The study examined the impact of acquisition cost on the performance of real estate investments in Nigeria. The ex-post facto research design was adopted to enable the researcher make use of secondary data to determine the cause-effect relationship of the costs of acquisition of assets and performance of real estate investments in Nigeria. The dependent and independent variables were observed over the period, 2015 to 2020. The data collected from the annual financial reports of the various quoted real estate companies in Nigeria were analyzed and tested using econometric analytical technique to determine the impact of the independent variable, on the dependent variables. The hypotheses were tested using the E-view statistical software adopting the Panel Least Square (PLS) method on the regression models adopted. The signs and significance of the regression coefficients were relied upon in explaining the nature and influence of the independent variable on the dependent variable as to determine both magnitude and direction of impact. Findings from the study revealed that investment cost had positive and significant impact on the performance of real estate investments in Nigeria while management cost, and finance cost had negative but significant impact on the performance of real estate investments in Nigeria. The study therefore, recommended that the government should make policies that will encourage real estate investment development in Nigeria, as way of diversifying the economy.

Acquisition Cost, Real Estate, Investment, Nigeria

---

References:

Abraham, M. (2009). An Exploratory study of the factors that influence the capital structure
of Real Estate firms in Kenya. MBA Thesis, Strathmore University

Adekunle, O. & Oladayo, O. (2013). Post – Merger Performance of Selected Nigerian
Deposit Money Banks – An Econometric Perspective. International Journal of
Management Sciences and Business Research, 2(8), 49-59.

Ajayi, C. A. & Fabiyi, Y. L. (1984). A Critique of Property Investment Feasibility and
Vability Appraisal Reporting in Nigeria, Quarterly Journal of Administration
April/July, 161-169.

Aliet, N. (2012). Cash management and profitability of corporate firms. A case study: MTN
Uganda Ltd. Bachelor’s degree – Business Administration of bishop Stuart University.

Ayomitunde, A. T., Akindele, D. B. & Abaka, J. M. (2019). Real Estate Development and
Economic Growth in Nigeria; Cointegration, DOLS and Granger Causality Approach,
Saudi Journal of Economics and Finanace, 3(2), 84-88

Belke, A. & Keil, J. (2017). Fundamental determinants of real estate prices: A panel study of
German regions, Econstor, Ruhr Economic Papers, No. 731

Chen, L. & Mills, T. I. (2006). Global real estate investable universe continues to expand
and develop, Hartford (USA): UBS real estate research, available at
www.ubs.com/realestate. Retrieved on 18th May, 2021
Detail Commercial Solicitors (2015). Nigeria Real Estate Guide, Volume 1,
file:///C:/Users/HP/Downloads/DETAIL_Rea_Estate_Guide_v1_2015.pdf. Retrieved
on 18th May, 2021

Elile, R. U.; Akpan, S. S. & Raju, V. (2019). Real Estate Investment Performance and
Macroeconomic Dynamics in Nigeria: A Sectorial Analysis, 8(2), 18-26

Emoh, F. I. and Uzuanje, I. (2015). The Effect of Increasing Cost of Capital on the
Profitability
of Real Estate Development in Benin City, Nigeria, Research Journal of Finance and
Accounting, 6(20), 81-91

Ihuah, P. W. (2015), Building materials costs increases and sustainability in real estate
development in Nigeria, African Journal of Economic and Sustainable Development,
4(3), 218-233

Izzo, P. J. (2004). Diversifying Among the Most Concrete of Assets, An Analysis of the
Optimal Direct U. S. Real Estate Investment Portfolio. An M.Sc thesis of Department
of Economics, Duke University, Durham, NC, USA.

Kew, J. and Watson, A. (2012). Financial Accounting: An introduction. 4th ed. Cape Town:
Oxford Universuty Press.

Liang, C. (2013). The Impact of Merger and Acquisition Announcements on Firms? Stock
Performance: Evidence from Hong Kong Stock Market. A research project submitted
in partial fulfillment of the requirements for the degree of Master of Finance Saint
Mary?s University, Halifax, Nova Scotia.

Nnubia, I. C., (2017). Effect of Capital Structure on Firm Performance of Quoted Companies
in Nigeria.Unpublished seminar work submitted to the Department of Accountancy,
University of Nigeria, Enugu Campus.

Okoro, R. C.; Effiong, J. B. & Igwe-Kalu, A. (2016). The Impact of Lack of Real Estate
Market
Research on Economic Growth and Development in Southern Nigeria, Quest Journal
of Research in Business and Management, 4(10), 68-79

Omondi, M.M. &Muturi, W. (2013). Factors affecting the financial performance of listed
companies at the Nairaobi Securities Exchange in Kenya. Research Journal of
Finance and Accounting, 4(15), 99-105.

Onwumere, J.U.J. (2009). Business and Economic Research Methods”, Enugu: Vougasen Ltd
Tudose, M.B. (2015). Capital structure and firm performance. International Journal of
Business and Commerce, 1, 166-181.

Udom, I. S. & Eze, O. R. (2015). Effect of Capital Adequacy Requirements on the
Profitability
of Commercial Banks in Nigeria, International Research Journal of Finance and
Economics, 165, 79-89

Umechukwu, A.I. (2016). The effect of capital structure on firm performance: evidence from
Nigerian quoted firms. Thesis presented to the department of Accountancy in partial
fulfillment of the requirements for the award of Ph.D in Accountancy, Faculty of
management Sciences, Chukwuemeka Odumegwu Ojukwu University, Igbariam
Campus.

DOWNLOAD PDF

---

Back