THE IMPACT OF STRUCTURAL CHANGES ON CORPORATE REAL ESTATE OWNERSHIP: EVIDENCE FROM GERMANY

Although real estate resources represent a high percentage of the corporate assets of non-property companies, their future role is unclear. Longevity and difficulty in revising property-related decisions clash under dynamically changing environmental conditions. This makes it necessary to consider the ownership strategy and its altering role in order to avoid inefficiencies and not to hinder companies in mastering structural change successfully. In a first step, data from a telephone company survey (CATI) among 69 corporate real estate managers of German companies are grouped by performing a two-step cluster analysis according to the degree to which they are affected by structural change. The resulting clusters are then tested regarding differences in their ownership strategy. The empirical analysis shows that firms highly affected by structural change exhibit a higher willingness to decrease the proportion of ownership. The decline in real estate assets is particularly evident in the office segment and in increased acceptance of sale-and-rent-back solutions. First hints show that structural change and associated new business requirements change the relevance of CRE ownership. To avoid competitive disadvantages, especially European firms should scrutinize their high ownership ratios.

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New Business Practices and the Corporate Real Estate Portfolio: How Responsive is the UK Property Market?

10.15396/eres1998_204 ◽

1998 ◽

Keyword(s):

Real Estate ◽

Business Practices ◽

Property Market ◽

Corporate Real Estate ◽

New Business ◽

The Uk

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Statistical Approaches to Structural Change in Regional Interindustry Models

Environment and Planning A Economy and Space ◽

10.1068/a181189 ◽

1986 ◽

Vol 18 (9) ◽

pp. 1189-1207

Author(s):

B Ó Huallacháin

Keyword(s):

Structural Change ◽

Structural Changes ◽

Washington State ◽

Multivariate Statistical Analyses ◽

Input Output ◽

Multivariate Statistical ◽

State Data ◽

System A ◽

Statistical Approaches ◽

The Impact

The conventional approach to assessing structural change in regional input – output tables is to measure the impact of coefficient change on the estimation of outputs and multipliers. The methods developed and tested in this paper focus exclusively on the coefficients. Univariate and multivariate statistical analyses can be used to identify and measure various types of changes ranging from coefficient instability to changes in interindustry relationships as a system. A distinction is made between structural changes in input relationships and those in output relationships. The methods are tested by using Washington State data for the years 1963 and 1967. The results are compared with previous analyses of change in these data.

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Corporate real estate, capital structure and value creation

Journal of European Real Estate Research ◽

10.1108/jerer-11-2016-0043 ◽

2017 ◽

Vol 10 (3) ◽

pp. 384-404 ◽

Cited By ~ 2

Author(s):

Maria-Teresa Bosch-Badia ◽

Joan Montllor-Serrats ◽

Anna-Maria Panosa-Gubau ◽

Maria-Antonia Tarrazon-Rodon

Keyword(s):

Real Estate ◽

Capital Structure ◽

Structure Theory ◽

Trade Off ◽

Content Type ◽

Default Option ◽

Bankruptcy Costs ◽

Corporate Real Estate ◽

Tax Savings ◽

The Impact

Purpose This paper aims to analyse the corporate rent-vs-buy decision on real estate through the trade-off theory and default option in the framework of a corporation that aims to optimise its capital structure. Design/methodology/approach The methodological core of this paper comprises the trade-off theory that approaches the optimal capital structure by counterbalancing debt tax savings with bankruptcy costs. Impacts on the default option and the default barrier are made explicit. The paper also explores the practical applicability of the renting scenarios in the European context by examining the regimes of real estate investment trusts in different countries from the demand-side of commercial renting. Findings Analytical relationships with tax savings, bankruptcy costs, default option and default barrier are identified for the renting-vs-buying real estate decisions. Research limitations/implications The theoretical model assumes simplifications, such as constant debt, to make it operational. The paper centres exclusively on the trade-off capital structure theory. Practical implications This paper is an analysis of corporate real estate decisions together with capital structure. Applications are not only quantitative but also conceptual and strategic. Originality/value Identifying the main variables that govern the impact of corporate real estate decisions on capital structure and interweaving different approaches generates a conceptual framework that enlightens strategic thinking in this field.

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International Real Estate Review

International Real Estate Review ◽

10.53383/100150 ◽

2012 ◽

Vol 15 (1) ◽

pp. 107-126

Author(s):

Hongyan Du ◽

◽

Yongkai Ma ◽

Keyword(s):

Real Estate ◽

Stock Returns ◽

Positive Impact ◽

Abnormal Returns ◽

Systematic Risk ◽

Stock Performance ◽

Significant Difference ◽

Corporate Real Estate ◽

Systematic Risks ◽

The Impact

This paper attempts to study the relationships among corporate real estate (CRE), capital structure and stock performance of China¡¦s non-real estate firms, including the bidirectional relationships between debt ratio (DR) and corporate real estate ratio (CRER), the impact of CRER on stock performance, and whether this impact differs across firms with different debt levels. The results show that for the overall sample, DR has a positive effect on CRER, while CRER negatively affects DR. CRER has no significant positive impact on the abnormal returns of stocks, and even decreases those for firms in the information industry. However, it can significantly reduce the systematic risks of stock returns. Moreover, we find that CRER has no significant effect on abnormal returns regardless of the amount of debt level that a firm has, and there is no significant difference between the effects of CRER on abnormal returns for firms with different levels of debt. On the other hand, the effect of CRER on systematic risk is significantly negative for firms in the low debt group, and insignificantly positive for firms in the high debt group. The CRER of lower debt firms can significantly reduce much more systematic risk than that of the high debt firms.

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Patterns of Structural Change in the New EU Member States

DANUBE Law and Economics Review ◽

10.1515/danb-2015-0009 ◽

2015 ◽

Vol 6 (3) ◽

pp. 133-157 ◽

Cited By ~ 1

Author(s):

Peter Havlik

Keyword(s):

Structural Change ◽

Structural Changes ◽

Growth Patterns ◽

Member States ◽

Sectoral Shifts ◽

Eu Member States ◽

The North ◽

European Economies ◽

The Impact ◽

New Eu Member States

Abstract This paper analyses the extent and impact of structural changes on aggregate economic growth that occurred in European economies during the past two decades, focusing on the new EU Member States of Central and Eastern Europe. After presenting some stylised facts related to employment and output restructuring, we use a conventional shift and share analysis in order to evaluate the impact of broader sectoral shifts on GDP growth, focusing on the period 1995–2011. A decomposition of aggregate GDP/GVA growth using the shift and share analysis shows a distinct North-South pattern of growth and restructuring while the previous NMS-OMS divisions are becoming less relevant. In the North, manufacturing and trade have fuelled growth whereas in the South there has been much less structural change. Apart from these differences, our results partly differ from earlier findings of similar analyses for the NMS. Finally, we analyse differentiated impacts of the recent (2008–2011) crisis on structural changes in Europe and find interesting similarities between (groups of) NMS and OMS in terms of both growth patterns and responses to the crisis.

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The Impact of Corporate Real Estate Ownership on the Firm Value

Journal of Real Estate Analysis ◽

10.30902/jrea.2021.7.3.163 ◽

2021 ◽

Vol 7 (3) ◽

pp. 163-183

Author(s):

Gwang Ho Han ◽

Hye Eun Han ◽

Seung Han Ro

Keyword(s):

Real Estate ◽

Firm Value ◽

Corporate Real Estate ◽

The Impact ◽

Estate Ownership

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ADJUSTMENT OF CORPORATE REAL ESTATE DURING A PERIOD OF SIGNIFICANT BUSINESS CHANGE

International Journal of Strategic Property Management ◽

10.3846/ijspm.2019.7954 ◽

2019 ◽

Vol 23 (3) ◽

pp. 171-186 ◽

Cited By ~ 3

Author(s):

Howard Cooke ◽

Rianne Appel-Meulenbroek ◽

Theo Arentze

Keyword(s):

Real Estate ◽

Business Strategy ◽

Time Lag ◽

Business Environment ◽

Business Strategies ◽

Business Change ◽

Flexible Resources ◽

Corporate Real Estate ◽

New Business ◽

Dynamic Alignment

This paper seeks to understand whether the alignment process between business strategy and Corporate Real Estate (CRE) between 2007 and 2014 was dynamic. It investigated the financial data of 230 UK companies by means of a distributed time lag auto-regression model. The results show an increased commitment to CRE suggesting a reduced ability to dynamically align the portfolio. Evidence is found that CRE adjusts as turnover, profitability and employment numbers alter. However, measures of efficiency, effectiveness and productivity are not improving. The new business strategies of transient competitive advantage and blue oceans strategy require flexible resources, which require CRE to be capable of dynamic alignment. This study shows such flexibility does not yet exist in practice. Current theories of alignment should be reconsidered in light of the changing business environment. Without a dynamic alignment capability of CRE a company’s financial performance will be impaired.

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