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Author: Yunus Yasin Dogan
Publisher:
ISBN:
Category :
Languages : en
Pages :
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Book Description
Using a sample of REITs from twelve countries around the world, we examine the determinants of REIT capital structure. We investigate firm-specific and country-specific factors, and account for the unique legal requirements that REITs face in each country. Our results suggest that legal requirements are significant determinants of the capital structure of REITs. Specifically, we find that REITs have the highest book debt ratio in countries where they must pay out most of their operating income. This result implies that REITs prefer debt financing to equity financing. Additionally, we find that in countries with no payment requirement, but leverage restrictions, REITS have lower book leverage, which suggests that internal financing is preferred to external financing. Our findings also indicate that country-specific factors do not have significant impact on REIT leverage.
Author: Yunus Yasin Dogan
Publisher:
ISBN:
Category :
Languages : en
Pages :
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Book Description
Using a sample of REITs from twelve countries around the world, we examine the determinants of REIT capital structure. We investigate firm-specific and country-specific factors, and account for the unique legal requirements that REITs face in each country. Our results suggest that legal requirements are significant determinants of the capital structure of REITs. Specifically, we find that REITs have the highest book debt ratio in countries where they must pay out most of their operating income. This result implies that REITs prefer debt financing to equity financing. Additionally, we find that in countries with no payment requirement, but leverage restrictions, REITS have lower book leverage, which suggests that internal financing is preferred to external financing. Our findings also indicate that country-specific factors do not have significant impact on REIT leverage.
Author: Yasser Alhenawi
Publisher:
ISBN:
Category :
Languages : en
Pages : 11
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Book Description
In this paper, I attempt to explain REITs borrowing behavior. With the absence of tax-deductibility advantage, several non-tax-driven benefits of leverage induce REITs managers to issue debt. Accordingly, I diagnose the relative importance of several non-tax-driven benefits of leverage in deriving the capital structure decisions of REITs. Consistent with the pecking order theory of leverage, REITs with higher existing investment use more debt; REITs with higher profitability issue less debt; and REITs with higher expected investment use less debt. I conclude that REITs managers issue debt mainly to avoid issuing equity and to maximize wealth of existing shareholders.
Author: C. F. Sirmans
Publisher: McGraw-Hill Companies
ISBN: 9780070576988
Category : Dwellings
Languages : en
Pages : 0
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Author: John A. Kilpatrick
Publisher:
ISBN:
Category :
Languages : en
Pages : 358
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Author: Bwembya Chikolwa
Publisher:
ISBN:
Category :
Languages : en
Pages : 41
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Book Description
Using panel data methodology, the determinants of capital structure in 34 Australia real estate investment trusts (A-REITs) are investigated for the period 2003 to 2008. Our results show that tangibility and size positively influence leverage, with risk having a negative impact. The A-REIT earnings payout requirement implies that profitability and growth opportunities have a low effect on leverage. No evidence is found to support A-REITs issuance of debt when interest rates are low. However, evidence is found to show that A-REITs are less likely to default on their debt obligations in a strong real estate market. Real estate sector effects are mixed and stapled management structure and international operations have significant negative signs, showing that A-REITs with these features should have lower gearing levels. The signs of the determinants show that both pecking order theory and the trade-off theory are at work in explaining the capital structure of A-REITs. We also find some support for A-REITs following the market timing theory of capital structure.
Author: Qingheng Zhu
Publisher:
ISBN:
Category :
Languages : en
Pages :
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Author: Stephanie Krewson-Kelly
Publisher: John Wiley & Sons
ISBN: 1119252768
Category : Business & Economics
Languages : en
Pages : 216
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Book Description
The go-to guide for smart REIT investing The Intelligent REIT Investor is the definitive guide to real estate investment trusts, providing a clear, concise resource for individual investors, financial planners, and analysts—anyone who prioritizes dividend income and risk management as major components to wealth-building. The REIT industry experienced a watershed event when Standard & Poors created a new Global Industry Classification Standard (GICS) sector called Real Estate. Publicly traded equity REITs have been removed from Financials, where they have been classified since their creation in 1960, and have begun trading as their own S&P Sector. This separation from banks and financial institutions has attracted new investors, but REITs require an industry-specific knowledge that is neither intuitive nor readily accessible to newcomers—until now. Using straightforward language and simple example to illustrate important concepts, this book will enable any reader to quickly learn and understand the lexicon and valuation techniques used in REIT investing, providing a wealth of practical resources that streamline the learning process. The discussion explains terminology, metrics, and other key points, while examples illustrate the calculations used to evaluate opportunities. A comprehensive list of publicly-traded REITs provides key reference, giving you access to an important resource most investors and stockbrokers lack. REITs are companies that own or finance commercial rental properties, such as malls and apartment buildings. Despite historically high total returns relative to other investments, such as the Nasdaq or S&P 500 index, most investors are unfamiliar with the REIT industry, and wary of investing without adequate background. This book gets you up to speed on the essentials of REIT investing so you can make more informed—and profitable—decisions. Understand REITs processes, mechanisms, and industry Calculate key metrics to identify suitable companies Access historical performance tables and industry-specific terminology Identify publicly-traded REITs quickly and easily REITs have consistently outperformed many more widely known investments. Over the past 15-year period, for example, REITs returned an average of 11% per year, better than all other asset classes. Since 2009, REITs have enjoyed positive returns; large cap stocks and cash are the only other classes that paralleled that record. Even in 2015, a 'year of fear' related to rising rates, REITs returned 2.4%, beating most all other asset classes. REITs have a long history (over fifty years) of performance, and have entered the big leagues. If you feel like you've been missing out, don't keep missing out. Prepare yourself, and your portfolio, to benefit from the demand for REITs that have followed the creation of a Real Estate GICS sector. The Intelligent REIT Investor gives you the information you need to invest wisely and manage your real estate risk effectively. By maintaining a tactical exposure in the brick and mortar asset class, investors should benefit from the information contained in The Intelligent REIT Investor. Join the REIT world and look forward to owning stocks that will help you to sleep well at night.
Author: Marcus Tillman Allen
Publisher:
ISBN:
Category :
Languages : en
Pages : 132
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Author: Helen X. H. Bao
Publisher:
ISBN:
Category :
Languages : en
Pages : 29
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Book Description
Using prospect theory, we develop a theoretical framework to examine the relationship between leverage and Real Estate Investment Trust (REIT) returns by introducing the concept of reference point. We postulate that firms' capital structure decisions are affected by a target leverage ratio (i.e., the reference point) as well as the observed leverage ratio. Firm-specific and time-varying target leverage determines a firm's leverage position, which when combined with market conditions will put firms in either loss or gain domains, where firms behave differently. In general, the effect of leverage on returns is positive in the gain domain and negative in the loss domain. Two hypotheses are derived and tested by using US REITs data from 1993-2013. Our empirical evidence shows strong support for our theoretical model. Compared to the conventional approach where only observed leverage is used, our model is more flexible and realistic in revealing the underlying structure of the leverage-returns relationship. It is also a potential solution to reconcile conflicting findings in the literature.
Author: Irwin Friend
Publisher:
ISBN:
Category : Capital investments
Languages : en
Pages : 22
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Book Description
