Explaining the Variation in REIT Capital Structure: The Role of Asset Liquidation Value
AbstractWe test the Shleifer-Vishny hypothesis that asset liquidation values influence both firm leverage and the choice of debt maturity. Using panel data on real estate investment trusts, we estimate a simultaneous equation model and find that firms specializing in the most (least) liquid assets use more (less) leverage and longer (shorter) maturities. The evidence also suggests that, for REITs, debt maturity and leverage are substitutes, consistent with the theory and predictions of Barclay, Marx and Smith. Copyright 2008 American Real Estate and Urban Economics Association
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Bibliographic InfoArticle provided by American Real Estate and Urban Economics Association in its journal Real Estate Economics.
Volume (Year): 36 (2008)
Issue (Month): 1 (03)
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- Hohenstatt, Ralf & Steininger, Bertram, 2011. "The rat race of capital structure research for REITs and REOCs: Two spotlights on leverage," ZEW Discussion Papers 11-077, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
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"Real Estate Securitization and the Debt Maturity Structure: Evidence from J-REIT,"
24581, University Library of Munich, Germany, revised Sep 2010.
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