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Do Management Changes Matter? An Empirical Investigation of REIT Performance

Author

Listed:
  • G. Stacy Sirmans

    (Department of Risk Management/Insurance, Real Estate and Business Law, College of Business, Room 248 RBB, Florida State University, Tallahassee, FL 32306-1110)

  • H. Swint Friday

    (Department of Finance, College of Business, Room DW 201C, Texas A&M University ? Corpus ChristiCorpus Christi, TX 78412)

  • Russell M. Price

    (Department of Finance, College of Business, Florida State University, Tallahassee, FL 32306-1110)

Abstract

Management’s (board of directors or executive officers) contribution to a firm is difficult to directly observe, although stock return performance can be a source of information. This study addresses this issue by extending the work of McIntosh, Rogers, Sirmans and Liang (1994) by analyzing management changes within REITs from 1984 to 2002. The findings indicate a significant relationship between negative performance and a management change from a period three months prior to the change in management. Logit and probit analysis are used to determine whether negative firm performance (measured by its relationship to market returns) can predict the likelihood of a management change. No predictive ability is found.

Suggested Citation

  • G. Stacy Sirmans & H. Swint Friday & Russell M. Price, 2006. "Do Management Changes Matter? An Empirical Investigation of REIT Performance," Journal of Real Estate Research, American Real Estate Society, vol. 28(2), pages 131-148.
    • Handle: RePEc:jre:issued:v:28:n:2:2006:p:131-148
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    References listed on IDEAS

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    Cited by:

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    2. Wang PeiZhi & Muhammad Ramzan, 2020. "Do corporate governance structure and capital structure matter for the performance of the firms? An empirical testing with the contemplation of outliers," PLOS ONE, Public Library of Science, vol. 15(2), pages 1-25, February.
    3. Jinliang Li & Robert M. Mooradian & Shiawee X. Yang, 2009. "The Information Content of the NCREIF Index," Journal of Real Estate Research, American Real Estate Society, vol. 31(1), pages 93-116.

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    JEL classification:

    • L85 - Industrial Organization - - Industry Studies: Services - - - Real Estate Services

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