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The Determinants of the Debt Maturity Decision for Real Estate Investment Trusts

Author

Listed:
  • Michael J. Highfield

    (Mississippi State University Mississippi State, MS 39762-9580)

  • Kenneth D. Roskelley

    (Louisiana Tech University Ruston, LA 71272-0046)

  • Fang Zhao

    (Siena College, Loudonville, NY 12211-1462)

Abstract

This research uses the maturity of incremental bond issues and the weighted-average maturity of all outstanding debt and tests various theories from the corporate debt maturity literature to discover if real estate investment trust (REIT) debt maturity is influenced by liquidity risk, asymmetric information, personal taxes, and agency problems. The findings reveal that there is little to no evidence for the liquidity and asymmetric information hypotheses; however, there is evidence that personal taxes influence the maturity of REIT incremental debt issues, and agency problems play a role in determining the incremental and average debt maturity of REITs

Suggested Citation

  • Michael J. Highfield & Kenneth D. Roskelley & Fang Zhao, 2007. "The Determinants of the Debt Maturity Decision for Real Estate Investment Trusts," Journal of Real Estate Research, American Real Estate Society, vol. 29(2), pages 173-200.
    • Handle: RePEc:jre:issued:v:29:n:2:2007:p:173-200
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    References listed on IDEAS

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    Cited by:

    1. Dong Chen & Yanmin Gao & Mayank Kaul & Charles Ka Yui Leung & Desmond Tsang, 2016. "The Role of Sponsors and External Management on the Capital Structure of Asian-Pacific REITs: The Case of Australia, Japan, and Singapore," International Real Estate Review, Global Social Science Institute, vol. 19(2), pages 197-221.
    2. Isil Erol & Dogan Tirtiroglu, 2011. "Concentrated Ownership, No Dividend Payout Requirement and Capital Structure of REITs: Evidence from Turkey," The Journal of Real Estate Finance and Economics, Springer, vol. 43(1), pages 174-204, July.
    3. Jamie Alcock & Eva Steiner & Kelvin Tan, 2014. "Joint Leverage and Maturity Choices in Real Estate Firms: The Role of the REIT Status," The Journal of Real Estate Finance and Economics, Springer, vol. 48(1), pages 57-78, January.
    4. Chinmoy Ghosh & Le Sun, 2014. "Agency Cost, Dividend Policy and Growth: The Special Case of REITs," The Journal of Real Estate Finance and Economics, Springer, vol. 48(4), pages 660-708, May.
    5. Sebehela, Tumellano, 2015. "Rationally financing an acquisition," Journal of Economics and Business, Elsevier, vol. 81(C), pages 1-20.

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    JEL classification:

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

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