Procurement practices and performance of affordable housing project in Nairobi county, Kenya.

Abstract

Affordable housing projects faced significant challenges worldwide, including cost overruns of up to 183%, affecting nine out of ten residential housing projects. In Nairobi County, Kenya, numerous affordable housing projects were stalled or remained incomplete, worsening housing shortages. This study aimed to examine the impact of procurement management practices on the performance of affordable housing projects in Nairobi County. Specifically, the study assessed the influence of supplier relationships, e-tendering, contract management, and information sharing with vendors on project performance. The research was guided by the stakeholder theory and Technological Acceptance Model 2 (TAM2). This study adopted a descriptive survey design to examine vendor management practices and their effect on affordable housing projects in Nairobi County, focusing on the Pangani and Starehe projects. The target population comprised 138 respondents, including project managers, procurement staff, contractors, and officials from relevant ministries. Census sampling was used for comprehensive coverage. Data were collected using structured questionnaires and interviews. Instrument validity and reliability were ensured through expert review, pilot testing, and statistical checks like Cronbach’s alpha. Quantitative data were analyzed using SPSS, while qualitative data underwent thematic analysis. Diagnostic tests addressed multicollinearity, heteroscedasticity, and autocorrelation, ensuring robust findings. The study found that the performance of affordable housing projects in Nairobi County is positively influenced by strong supplier relationships, efficient contract management, and the adoption of etendering practices, with supplier relationships (r = 0.613, p < 0.01) and e-tendering (r = 0.591, p < 0.01) showing the most significant correlations with project performance. While information sharing showed a moderate positive correlation with performance (r = 0.441, p < 0.05), it was identified as a less influential factor. Additionally, challenges in budget compliance, affordability, and supplier reliability were highlighted, with project timelines and resource utilization performing relatively well. The study recommends improving stakeholder collaboration, enhancing the adoption of digital technologies, and strengthening contract management practices to boost performance. For further research, the study suggests exploring the role of digital literacy in etendering.