Feasibilty Analysis and Performance of Real Estate Development Projects in Kisumu City, Kenya

Abstract

Real estate comprises of four distinct sub-sectors of commercial, housing, retail and hospital. Performance of real estate development projects in Kisumu City have been evaluated and reported to be underperforming. The hard issues surrounding real estate in Kisumu City are related to high inflation rate, low purchasing power of the population, unhealthy competition from players in the industry, high cost of accessing the working capital. The purpose of the study is to establish. Objectives of the study are; to examine influence of financial feasibility analysis on Performance of Real Estate Development Projects in Kisumu City, to assess influence of economic feasibility Analysis on performance of real estate development projects in Kisumu City, to determine of influence of market feasibility analysis on performance of real estate development projects in Kisumu City and to establish influence of environmental feasibility analysis on performance of real estate projects in Kisumu City. Resource dependency theory and technical efficiency theory anchors the study while the study employed descriptive survey research design. The target population is 165 respondents and 117 as sample size calculated using Yamane formula of 1967. Content and construct validity of the research instruments were ensured by having the instruments reviewed by the study supervisor while reliability was ensured by split-half method. Data was analyzed using inferential statistical analysis of regression and correlation analyses and descriptive statistical analysis of mean, SD, percentage and frequency counts. The results have been presented in tables. On objective one the study reported a significant moderately strong positive correlation between financial feasibility analysis and performance of real estate development projects , (r=0.309; P0.001). On objective two, the study reported a significant weak positive correlation between economic feasibility analysis and performance of real estate development projects , (r=0.253; p0.009). On objective three, reported a significant moderately strong positive correlation between market feasibility analysis and performance of real estate development projects , (r=0.302; p0.002) and on objective five, the study reported a significant weak positive correlation between environmental feasibility analysis and performance of real estate development projects , (r=0.260; p0.007). The study concluded that feasibility analysis of financial, economic, market and environmental factors have got significant influence on performance of real estate development projects. The study recommended proper and institutional policy frameworks to enhance performance of real estate development projects