Occupiers' Perception of Commercial Leases: Empirical Evidence from Ede, Nigeria

Abstract

The purpose of this study is to examine the perception of commercial property occupiers’ towards their lease structures, terms and duration (LSTD) in Ede, Nigeria. Questionnaire survey was carried out to elicit for information from the occupiers’ in the study area. The targeted population for the study consisted of 917 shops in prime commercial areas of Ede. The sample size adopted was 12% of the population. The random sampling technique was used in selection of the sample size for the study. Structured questionnaires were administered to shop owners in the study area, which totaled 150. However, only 113 questionnaires were retrieved (i.e 75% response rate). The results from the 113 responses were collated and analyzed using both descriptive and inferential statistics. The study revealed that most occupiers in the study area are satisfied with their current lease duration which is mostly of a year (renewable) duration; most of the occupiers are however dissatisfied with some of the terms in their lease structure. It was recommended that the government should intervene in the real estate rental market in Nigeria by harmonizing the LSTD in the country. Leases should also be structured in such a way that it will be acceptable and satisfactory to both the lessees and the lessors. This will help in the mitigation of the constant conflicts experienced among stakeholders in the Nigerian rental property market as well as address the mismatch between what occupiers’ desire and what lenders or lessors provide.