The Financial Performance of REITs Following Initial Public Offerings
AbstractThis study examines changes in operating performance among real estate investment trusts following an initial public offering (IPO). The purpose is to determine whether there is an enhancement in the value of the underlying asset that is related to the IPO. We separately analyze equity, mortgage and diversified REITs. We also compare the operating performance of recent IPOs to those of earlier years to address the impact of the 1993 Revenue Reconciliation Act on institutional investors’ demand for REIT stock. Unlike previous analyses of industrial firms, REITs were found to have significant increases in Return on Assets and selected measures of financial performance. The post-IPO cumulative stock price decline and recovery is illustrated.
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Bibliographic InfoArticle provided by American Real Estate Society in its journal Journal of Real Estate Research.
Volume (Year): 16 (1998)
Issue (Month): 3 ()
Contact details of provider:
Postal: American Real Estate Society Clemson University School of Business & Behavioral Science Department of Finance 401 Sirrine Hall Clemson, SC 29634-1323
Web page: http://www.aresnet.org/
Postal: Diane Quarles American Real Estate Society Manager of Member Services Clemson University Box 341323 Clemson, SC 29634-1323
Find related papers by JEL classification:
- L85 - Industrial Organization - - Industry Studies: Services - - - Real Estate Services
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