PURPOSE: Indirect African property investments have largely been left out of international investment portfolios due largely to lack of empirical data (Akpan & Ogunba, 2015). This study attempts to provide some performance data which might stimulate more indirect African investment. It examines the return, risk, risk adjusted performance, diversification benefits and efficient frontier of a 4-aset portfolio of REITs which include an African country (Nigeria), and selected countries from other continents (Malaysia, USA and UK).

DESIGN/METHODS FOLLOWED/APPROACH: First, the paper calculated the returns, risk and risk adjusted returns (return to risk and coefficient of variation) of the assets. Second, the paper employed Mean variance analysis to determine the efficient frontier. Third, diversification benefits of each country’s REITs in the four asset portfolio were determined. The approach in doing this was to create five scenarios: The first scenario was an unconstrained set of efficient combinations of the four assets. The four other scenarios involved a sequential exclusion of one country’s assets at a time, creating constrained sets of efficient combinations of 3 of the four assets. The highest return to risk ratio and lowest coefficient of variation of each of the constrained sets were compared with corresponding ratios of the unconstrained set to determine return enhancing and risk reducing benefits

FINDINGS: The African REITs (N-REITs) were shown to perform well on most indicators and not so well on others. It provided the lowest risk of all the four REIT assets and one of the highest risk adjusted returns. Though it provided lower (zero) return enhancing benefits relative to US and Malaysian REITs, it also provided lower (zero) risk increasing effects. The efficient frontier demonstrated that risk adverse investors should invest as high as 49.187% in N-REITs.

PRACTICAL IMPLICATIONS: There is considerable potential for investing in African (in this case, Nigerian) REITs.

ORIGINALITY/VALUE OF WORK: The paper is probably the first to consider the inclusion of African REITs in international REIT portfolio.