Growth Strategies and Performance of Student Housing Sector in Kenya: A Case of QWETU

Abstract

Over the past decade, Kenya’s higher education sector has experienced significant growth, with student enrollment in universities increasing from 361,379 in 2013 to over 562,100 in 2022. However, this expansion has not been matched by a corresponding investment in quality and affordable student accommodation, resulting in a persistent and widening housing deficit. Despite the growing demand, Student housing sector such as Qwetu continue to face challenges in maintaining optimal performance in terms of occupancy rates, revenue growth, and expansion. Against this backdrop, the purpose of this study was to evaluate the effect of growth strategies on the performance of Student housing sector in Kenya. The specific objectives of the study were to; examine the effect of market penetration strategy on the performance of Qwetu hostels; assess the effect of market development strategy on the performance of Qwetu hostels; establish the effect of product development strategy on the performance of Qwetu hostels and to evaluate the moderating effect of organizational factors on the relationship between growth strategies and the performance of Qwetu hostels. The study was anchored on the Resource-Based View (RBV) as the anchor theory, as well Ansoff’s Growth Matrix, the Balanced Scorecard (BSC), and Institutional Theory. A cros-ssectional-explanatory research design was adopted. The target population comprised 76 senior, mid-level, and junior managers at Qwetu Hostels. Primary data was collected using a structured questionnaire, and a pretest was conducted among eight managers from Kejani Hostels. Data was analyzed with the aid of SPSS version 29.0, using descriptive statistics such as mean and standard deviation and inferential statistics such as regression and correlation analysis. Findings demonstrated that all three growth strategies had statistically significant positive effects on performance. Market penetration explained 51.0% (R²=.510, p<.05) of variance in performance, while market development accounted for 50.2% (R²=.502, p<.05), and product development explained 42.9% (R²=.429, p<.05). Collectively, the growth strategies index explained 55.0% (R²=.550) of performance, which increased to 63.7% (R²=.637) upon inclusion of organizational factors. Moderation analysis confirmed that organizational factors significantly strengthened the relationship (β=.195, p=.058), raising explanatory power to 67.7% (R²=.677). The study concludes that penetration, development, and innovation strategies are indispensable drivers of PBSA performance, and their effectiveness is magnified when reinforced by supportive organizational cultures and leadership. It recommends intensification of targeted promotions, geographical expansion, continuous product innovation, and alignment of organizational values with strategic objectives. The study contributes to strategic management scholarship and offers practical insights for policymakers and industry leaders seeking to enhance competitiveness and sustainability in the student housing sector.