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Using REIT Data to Assess the Economic Worth of Mega-Events: The Case of the 2020 Tokyo Olympics

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  • Ogawa, Ryoh

Abstract

This paper proposes an alternative approach to evaluate the effects of hosting mega-events, such as the Olympics, Football World Cup, and World Expo. Based on capitalization hypothesis, previous literature studies examined whether the announcement of mega-events affects prices of firms’ stock or real estate property. In contrast, I utilize data on Real Estate Investment Trust (REIT), whose price is a hybrid of stock and property. The standard event study methodology with high-frequent data allows the estimation of abnormal returns due to the mega-event of interest, and clarifies the relationship between level of returns and characteristics of REIT’s property. I present an empirical example—the 2020 Tokyo Olympics—and the results are as follows: 1) investors judged that the comprehensive effects would be positive; 2) the effect becomes smaller as the distance from Host City (Tokyo-to) increases; 3) even in areas far from Tokyo-to, real estate used for hotels and commercial facilities are relatively susceptible to the Olympics.

Suggested Citation

  • Ogawa, Ryoh, 2017. "Using REIT Data to Assess the Economic Worth of Mega-Events: The Case of the 2020 Tokyo Olympics," MPRA Paper 78829, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:78829
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    References listed on IDEAS

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    Cited by:

    1. Chia-Lin Chang & Shu-Han Hsu & Michael McAleer, 2018. "An Event Study Analysis of Political Events, Disasters, and Accidents for Chinese Tourists to Taiwan," Sustainability, MDPI, vol. 10(11), pages 1-77, November.
    2. Chang, C-L. & Hsu, S.-H. & McAleer, M.J., 2018. "An Event Study of Chinese Tourists to Taiwan," Econometric Institute Research Papers 2018-003/III, Erasmus University Rotterdam, Erasmus School of Economics (ESE), Econometric Institute.

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    More about this item

    Keywords

    mega-events; Olympic Games; Real Estate Investment Trust; event study;
    All these keywords.

    JEL classification:

    • G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading
    • L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Restaurants; Recreation; Tourism
    • R30 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - General
    • R53 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis - - - Public Facility Location Analysis; Public Investment and Capital Stock

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