UNIVERSITY OF NIGERIA, ENUGU CAMPUS

FACULTY OF ENVIRONMENTAL STUDIES

DEPARTMENT OF ESTATE MANAGEMENT

AN ASSIGNMENT WRITTEN IN PARTIAL FULFILLMENT OF THE

REQUIREMENTS FOR THE COURSE: APPLIED PROPERTY MANAGEMENT

(ESM 551)

TOPIC: AN ASSESSMENT OF THE PROPERTY MANAGEMENT MEASURES

ADOPTED IN MANAGING PROPERTY IN ASATA, ENUGU STATE.

(CASE STUDY OF PROPERTY LOCATED AT NO. 14 O’CONNOR STREET, ASATA)

BY

SAMUEL UWEM ANIEKAN

REG. NO: 2015/199591

LECTURER I/C: DR. MRS O. J. AKALEMEAKU

JANUARY, 2021
INTRODUCTION

Just like the functioning of a human system through efficient maintenance and responding to the
needs of the system, a real property would only achieve the goals of its owner through efficient
and effective property administration. Property administration looks at the overall operational
functions of a property for example its maintenance, rent collections, inspections, etc. and this
work is primarily focused on; firstly, to give a theoretical understanding of the various concepts
of property management administration and secondly, a brief report of the administration of a
subject property located at No.14 O’Connor Street, Asata, Enugu state using the various concepts
of property management administration described in the subsequent sub-heeding.

Google Map view of Enugu showing the case study area (ASATA, ENUGU STATE)

THEORETICAL FRAMEWORK OF PROPERTY ADMINISTRATION

This section hopes to give brief theoretical description of some administrative features of a
property as would be discussed in the case study.

1. MARKETING OF VACANT SPACE

This involves a situation where an agent went in search of prospective tenants or buyers, employing
various advertising strategies such as: circulation of property bulletin; advertisement in firm’s
website and social media pages; fixing letting or sales boards; personal contacts with friends,
relatives and colleagues. In the case of letting, either individual or corporate tenants are targeted
while marketing.

2. SERVICE CHARGE ADMINISTRATION

Property companies maintains a service charge account for properties with exceptional facilities
such as lifts, central air conditioning, swimming pools, etc. or serviced properties or multi-
occupied properties. This ensures proper maintenance of the facilities and services provided. It is
meant to cover costs of cleaning and gardening to shared areas; maintenance and running of stand
– by generators; clearing of refuse; maintenance of water pumps; routine maintenance and running
of lifts; general security of property, sewage treatment and maintenance among others. Tenants
normally pay service charge to the firm alongside rent payment. The amount of service charge is
usually dependent on the number of services provided and the space. In some of the properties, it
is estimated as a percentage of the total rent. However, service charge administration differs from
property to property. Some are collected quarterly and some are collected yearly. Fee from service
charge is also deducted.

3. RENT NEGOTIATION
Negotiation is another important phase property management administration. Letters of offer
which usually state the sale/ letting conditions entailing disposal price/ rent, deposit payable , legal,
statutory and other fees, et cetera are forwarded to the prospective buyers/ tenants. The prospective
buyers/ tenants or their agents either writes back accepting the offer or have the offer letter signed,
dated and returned to the firm indicating acceptance. Where there is counter offer from them, a
letter of acceptance containing same conditions is forwarded to them if the seller/ lessor consent;
otherwise a letter rejecting the counter offer will be sent to them.

4. ROUTINE MANAGEMENT INSPECTION

Routine management inspection are inspection usually conducted every 3 to 6 months to make
sure the property is still in a good state of repair with no suspicious or illegal activity going on.
Some things to look out for during routine management inspection include; Maintenance issues,
damages, lease violations etc.
5. TENANT SELECTIONS
This involves the assessment of prospective tenants to ensure that they are worthy of being
admitted into the premises. This looks at the financial strength of the prospective tenants amidst
other criteria and it one of the most important aspect of property management administration.

6. RENT COLLECTION (PERIODICALLY)

This aspects looks at the rent collections methods, procedures and mediums. It emphasis how
respective property manager desires to retrieve rent from their tenants and how the rent should be
paid. Some resort to only bank cheques and transfer due to the large monetary sum involves while
others prefer cash collection especially in cheap apartments.

7. ASSIGNMENT AND SUB-LETTING

Assignment refers to the concept of transferring the entire leasehold duration to a third party
without a reverse back period while sub-letting in the other hand refers to the leasing of a leasehold
interest to a sub-leasee with a remainder duration to reverse back to the initial leasee before the
expiration of the original leasehold duration.

8. INSURANCE
This involves the letting go of a sum of money periodically by the property manager or the property
owner as the case may be so as to insure the concerned property against future unforeseen
circumstances e.g. fire outbreak, building collapse etc.

9. RENT REVIEWS
Rent review are simply referred to as an upward or downward adjustment of the rent payable by a
leasee to commensurate with the prevalent economic situations, standard of the building etc. It is
usually done after some prescribed duration of years and it is introduced by an appropriate rent
reviews correspondences.

10. ACCOUNTING
This refers to the monetary documentation as far as property management administration is
concerned. It looks at the revenue account, capital account, expenditures etc.
 PROPERTY ADMINISTRATION: A REPORT OF A PROPERTY LOCATED AT 14
O’CONNOR STREET ASATA, ENUGU STATE

1. PROPERTY DESCRIPTION
The property which is located at No. 14 O’connor Street, Asata, Enugu State with the coordinates
N:6026’34.3”, E:7029’58.9” is a building on three wings; two wings facing each other and one
wing directed opposite the road network. The two wings facing each other is a building on three
floors with a total of 6 units per wing while the wing which is directly opposite the road network
is a building on four floors with a total of 16 units of which four units were vacant as at the date
of inspection. Though the entire structure are interconnected with the other wings, but it has
different elevations and this could only point to the architectural proficiency of this structure.

APPROACH VIEW OF THE SUBJECT PROPERTY

The property is exquisitely and tastefully finished both interior and exterior with modern finishing
elements and this attracts some high class businesses in which the property is used for. Generally,
the property is a commercial unit with a total of 28 tenantable units and an in-house property
manager that stays within the premises of the property and cater for the day to day management of
the property.
2. MARKETING OF VACANT SPACE
The vacant space found during inspection of the property where actually marketed through various
means of advertisement which includes placing of ‘To Let’ noticed on the premises, deposition of
advertisement fliers at strategic companies, through social media medium etc.

VACANT SPACE WITHIN THE PREMISES

[[

3. RENT PASSING
After consultation with the in-house manager of the premises, the rent passing per unit was
identified to be N500, 000 (Five Hundred Thousand Naira) only.
[

4. ROUTINE MANAGEMENT INSPECTION

Routine management inspection as was discussed in the sub-heading above is actually carried out
by the in-house property manager that resides and operates within the subject property premises.
But in this case, the inspection are done more often and sometime casually as the manager notices
any default as soon as it comes due to it closeness to the property.

5. PERIODIC INSPECTION
As highlighted by the in-house property manager, this involves their entering into the premises of
the tenants to oversee the interior elements of the building and it is mostly done when a report has
been made about any malfunction or damages or when a lease duration is about to expire and a
new lease agreement is to be made. This practice as mentioned by the in-house manager could be
known as pre-vacation inspection in a real estate parlance.

6. TENANT SELECTIONS
The tenant selection criteria as far as the subject property is concerned can be said to be not as
strict and comprehensive as the one administered by real estate professionals. In this aspect, the
resident property manager looks at primarily the ability of the prospective tenants to pay the
required rents and other charges and does not undergo character, values and moral assessment.

7. RENT NEGOTIATION
On entrance as a fresh tenants, the rent passing is said to be fixed as the same amount mentioned
earlier and non-negotiable. Other fees demanded on fresh entry into this property include;

 Service Charge – 20% of rent

 Legal fee - - - - -- 5% of rent
 Agency - - - - - - 5% of rent
 Refundable Caution Deposit – N50,000
All the mentioned sum is captured and sent across in the offer letter presented by the property
manager with the designated account details for payment if the offer is accepted.

8. RENT COLLECTION (PERIODICALLY)

Rent are collected annually and only through bank transfer and cheques as physical cash are not
accepted due to the large sum involve and the insecurity currently prevalent in the society.

9. ASSIGNMENT AND SUB-LETTING

Assignment and sub-letting are not allowed in this property has the property owner restrict strongly
against such practices and this is included in the tenant agreement that is issued to tenant before
they take over possession of the premises.

10. INSURANCE
The property is not insured as at the date of this inspection. This information was made available
by the in-house property manager who acts in/on behalf of the property owner. According to the
Manager, the property owner does not fancy the idea of insurance.
11. SERVICE CHARGE
As a modern and high class commercial property in the heart of Enugu State, the property is
serviced internally. The services property by the manager to the tenants occupying the premises
includes;

 Cleaning
 Water
 Security
 General generator, though in this regards, the fuelling of this plant is done exclusively by
tenants.
The calculation measure adopted to determine how much each tenants are to contribute or pay with
regards to the services offered to them can be said to be static, fixed and equal across all tenants.
Each tenants is simply obligated to pay a service charge of 100,000 per year which is 20% of rent
paid.

12. RENT REVIEWS

The idea of rent reviews were not considered by the in-house property manager since the property
is new and rent remain same for now.

13. ACCOUNTING
Since the property is managed by an in-house manager which is not really a trained personnel for
the task, the accounting aspects of his managerial work was kept confidential and not to be revealed
to the public.

CONCLUSION
To conclude, it is pertinent to once again emphasize that just like a human system, the
proper and efficient administration of property management practices enhances not just it
aesthetics and functionality but also its economic values and this is the aim of every successful
property manager. With regards to the case study examined above, one would easily noticed that
though an untrained person might step up to manage a property but it takes only a trained
professional in the area of property management to really gives an effective and efficient
management skills needed to achieve the investment objectives of the property owners.
REFERENCE

Interview with Mr. Chidiebere Okafor (in-house property manager) on 27th January, 2021.