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Stylized Facts About Industrial Property Construction

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Abstract

This paper investigates the relationship between industrial property construction and the macroeconomy. The paper uses vector autoregressions to model this relationship, which allows the lags inherent in the construction process to be modeled. The results indicate that employment shocks account for the majority of the variation in industrial property construction. Shocks in output and nominal interest rates also exhibit some influence, but their influence is through employment. Finally, the paper shows that these economic variables affect industrial construction with a lag, although the lags are generally shorter than those report for office property.

Suggested Citation

  • John L. Kling & Thomas E. McCue, 1991. "Stylized Facts About Industrial Property Construction," Journal of Real Estate Research, American Real Estate Society, vol. 6(3), pages 293-304.
    • Handle: RePEc:jre:issued:v:6:n:3:1991:p:293-304
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    References listed on IDEAS

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    1. Cooley, Thomas F. & Leroy, Stephen F., 1985. "Atheoretical macroeconometrics: A critique," Journal of Monetary Economics, Elsevier, vol. 16(3), pages 283-308, November.
    2. Burbidge, John & Harrison, Alan, 1984. "Testing for the Effects of Oil-Price Rises Using Vector Autoregressions," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 25(2), pages 459-484, June.
    3. Angeloni, Ignazio, 1985. "The dynamic behavior of business loans and the prime rate : A comment," Journal of Banking & Finance, Elsevier, vol. 9(4), pages 577-580, December.
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    Cited by:

    1. Tony McGough & Sotiris Tsolacos, 1999. "Interactions within the Office Market Cycle in Great Britain," Journal of Real Estate Research, American Real Estate Society, vol. 18(1), pages 219-232.
    2. Robert Thompson & Sotiris Tsolacos, 2000. "Projections in the Industrial Property Market using a Simultaneous Equation System," Journal of Real Estate Research, American Real Estate Society, vol. 19(2), pages 165-188.
    3. Thomas E. McCue & John L. Kling, 1994. "Real Estate Returns and the Macroeconomy: Some Empirical Evidence from Real Estate Investment Trust," Journal of Real Estate Research, American Real Estate Society, vol. 9(3), pages 277-288.
    4. Kim Hin David Ho & Satyanarain Rengarajan, 2017. "Industrial Real Estate Market Dynamics in Singapore: A VAR Approach," International Real Estate Review, Global Social Science Institute, vol. 20(4), pages 417-450.
    5. Asieh Mansour & Marvin C. Christensen, 2001. "An Alternative Determinant of Warehouse Space Demand: A Case Study," Journal of Real Estate Research, American Real Estate Society, vol. 21(1/2), pages 77-88.

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    JEL classification:

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

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