Corporate real estate management and bank profitability

Kenneth Donkor-Hyiaman,Benjamin Ajabuin,De-Graft Owusu-Manu,Esther Narhkwor Terkper,Eric Paul Tudzi

doi:10.30585/jrems.v3i4.651

Abstract

Acquiring property for any business is capital intensive and for that matter, strategically managing such assets is considered equally important. This paper provides an analysis of the value-adding attributes of corporate real estate management (CREM) and bank performance in Ghana. The multiple regression method was applied to a cross-section of both primary and secondary data sourced from 25 commercial banks in Ghana. The study shows that the banks identify with the value-adding attributes of corporate real estate asset management even though there are variations in the level of importance to individual banks. These variations are attributable to the unique mandates of the banks. Further analysis shows that CREM has significantly positive impacts on bank profitability by strategies that help to increase innovations, increase productivity, and promote marketing and sales. The finding suggests that optimizing these CREM strategies could help increase bank profits.

Highlights

Most corporate entities require some form of real property to perform their core functions, which makes the management of all such properties important (Ijasan, 2013)
The first section is on the asset profile of the banks, followed by bank performance and profitability, value adding attributes of Corporate real estate (CRE), and the regression results
The model explains about 72.77% of variations in bank performance. This implies that Corporate real estate management (CREM) is essential in assessing overall bank profitability in Ghana

Summary

Introduction

Most corporate entities require some form of real property to perform their core functions, which makes the management of all such properties important (Ijasan, 2013). Corporate real estate management (CREM) can be defined as the management of real estate by companies or organizations whose core business is not real estate business (Lindholm et al, 2006). It is a new area within the real estate and business community (Omar & Heywood, 2014). Appel-Meulenbroek et al (2010), further adds that the key focus of CREM should be to contribute to the brand of the core business of the organization by aligning real estate assets. There is the need for organizations to redirect their focus toward the strategic perspective of CRE as an important tool to enhance the performance of businesses towards achieving their core objectives

Results

Discussion

Conclusion