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Article
Publication date: 7 August 2017

Kim Hin David Ho, Kwame Addae-Dapaah and Fang Rui Lina Peck

The purpose of this paper is to examine the common stock price reaction and the changes to the risk exposure of the cross-listing for real estate investment trusts (REITs).

Abstract

Purpose

The purpose of this paper is to examine the common stock price reaction and the changes to the risk exposure of the cross-listing for real estate investment trusts (REITs).

Design/methodology/approach

The paper adopts the event study methodology to assess the abnormal returns (ARs). Pre- and post-cross-listing changes in the risk exposure for the domestic and foreign markets are examined, via a modified two-factor international asset pricing model. A comparison is made for two broad cross-listings, namely, the depositary receipts and the dual ordinary listings, to examine the impacts from institutional differences.

Findings

Cross-listed REITs generally experience positive and significant ARs throughout the event window, implying significant superior returns associated with the cross-listing for REITs. On systematic risks, REITs exhibit significant decline in their domestic market β coefficients after the cross-listing. However, the foreign market β coefficients do not yield conclusive evidence when compared across the sample.

Research limitations/implications

Results are consistent with prudential asset allocation for potential diversification gains from the cross-listing, as the reduction from the domestic market beta is more significant than changes in the foreign market beta.

Practical implications

The results and findings should incentivise REIT managers to explore viable cross-listing.

Social implications

Such cross-listing for REITs should enhance risk diversification.

Originality/value

This is a pioneer study on cross-listing of REITs. It provides a basis for investment decision making, and could provoke further research and discussion.

Details

Journal of Property Investment & Finance, vol. 35 no. 5
Type: Research Article
ISSN: 1463-578X

Keywords

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Article
Publication date: 1 June 2002

Kwame Addae‐Dapaah

Abstract

Details

Journal of Property Investment & Finance, vol. 20 no. 3
Type: Research Article
ISSN: 1463-578X

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Article
Publication date: 1 April 2014

Kim Hin/David Ho and Kwame Addae-Dapaah

The purpose of this paper is to help us understand the real estate cycle and offers an analysis using a vector auto regression (VAR) model. The authors study the key…

Abstract

Purpose

The purpose of this paper is to help us understand the real estate cycle and offers an analysis using a vector auto regression (VAR) model. The authors study the key international cities of Hong Kong, Kuala Lumpur and Singapore. The authors find four key outcomes. One, the real estate cycle is generally different from the underlying business cycle in local markets for the cities studies. Two, the real estate cycle is more exaggerated in the construction and development areas than in rents and vacancies. Three, the vacancy cycle tends to lead the rental cycle. And four, new construction completions tend to peak when vacancy is also peaking. The authors believe that future research should try to help understand the linkages that drive these outcomes. For example, are rigidities in the local permit and construction markets responsible for the link between construction peaks and vacancy peaks?

Design/methodology/approach

Real estate market cyclical dynamics and its estimation via VAR model offers an insightful set of practical and empirical models. It affirms a comprehensive theoretical underpinning for analysing the prime office and residential sectors of the capitol cities of Kuala Lumpur, Singapore and Hong Kong in the fast developing Asia region. Its unrestricted form also provides an effective and insightful way of modelling real estate market cyclical dynamics utilising only real estate market indicators, furnished by real estate market data providers.

Findings

The office rental VAR model for Singapore (SOR), KL (KOR) and HK (HOR) show good fits. In the HOR model, rents and vacancies are negatively signed and significant for certain lagged relationships with other variables and with rents themselves. The office CV VAR model for Singapore (SOCV), KL (KOCV) and HK (HOCV) show good fits. In the HOCV model, capital values (CVs) and initial yields are negatively signed and significant for certain lagged relationships with other variables and with CVs themselves. Impulse response functions specified for seven years to mirror a medium-term real estate market cycle “die out” to zero for the stationary VAR models that are estimated for the endogenous variables. The accumulated responses asymptote to some non-zero constant.

Practical implications

The VAR model offers a complete and meaningful dynamic system of solely real estate variables for international real estate investors and policy makers in decision making. Its unrestricted form offers an effective and insightful way of modelling real estate market cyclical dynamics utilising only real estate market indicators, which can be reliably provided by a dedicated real estate information and consultancy provider of international standing.

Originality/value

The theoretical model offers a complete dynamic model system of the real estate space market, comprising a unique system of six linked equations that denote the relationship among supply, demand, construction, vacancy and rent over time, inclusive of price response slopes and lags. The VAR model enables the investigation of the effect of the lagged values of all the variables concerned. It also enables the explicit and rigorous quantitative forecasts of say rents and CVs when the rest of the variable can be forecasted beforehand.

Details

International Journal of Managerial Finance, vol. 10 no. 2
Type: Research Article
ISSN: 1743-9132

Keywords

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Article
Publication date: 1 March 1999

Kwame Addae‐Dapaah and Cindy Yeo

The retail industry of Singapore has been in a depression since 1993, as a result of structural problems which are a function of, among other things, over‐supply of retail…

Abstract

The retail industry of Singapore has been in a depression since 1993, as a result of structural problems which are a function of, among other things, over‐supply of retail space vis‐à‐vis retail performance, and rising rentals. This paper argues that percentage lease agreements (also called “turnover rents”), by fostering partnerships between landlords and tenants, could be a viable shopping center management tool for salvaging the retail industry of Singapore.

Details

Property Management, vol. 17 no. 1
Type: Research Article
ISSN: 0263-7472

Keywords

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Article
Publication date: 7 March 2016

Kenneth Appiah Donkor-Hyiaman and DeGraft Owusu-Manu

Most households in Sub-Saharan African cannot afford adequate housing. Most often, their pension benefits are also meagre, usually resulting from low contribution levels…

Abstract

Purpose

Most households in Sub-Saharan African cannot afford adequate housing. Most often, their pension benefits are also meagre, usually resulting from low contribution levels and mismanagement. Coupled with low life expectancies, most would not live to enjoy the benefits of pensions, thus validating the need to utilize their hitherto deferred pension benefits for immediate housing investment and consumption.

Design/methodology/approach

Quantitative research methodology via the present value technique was used in valuing pension benefits to demonstrate the potential of pension schemes as savings mobilization mechanisms for long-term pension-backed housing financing in Ghana.

Findings

Policy wise, the paper provides some evidence to support proposals for the development of pension-backed housing finance systems in Ghana with lessons for Sub-Saharan Africa. The authors demonstrate that the Tier 2 defined contribution mandatory occupational pension scheme could serve the purpose of a savings mobilization mechanism for long-term housing financing. The authors observe that by increasing the Tier 2 contribution rate to 30 per cent, the majority of the sample, mainly of the middle-income class, could accumulate between US$11,000 and US$17,000 over their working life. At the same rate, between US$5,783 and US$9,550 could have been raised as savings between 2010 (when implementation began) and 2014. This could form a substantial equity contribution in a mortgage investment and or borrowed on a housing microfinance basis.

Originality/value

The paper contributes to the ongoing debate on the need to develop alternate savings mechanisms and collateral assets using pension assets, other than property, for mortgage financing. The proposals made are aimed at influencing policy by way of advocating for the use of latent pension equity to improve the housing conditions of members while they are alive, and also to suggest pension-backed housing financing as an alternative investment option. A comprehensive study would be required to settle issues of scalability, pricing and model design.

Details

International Journal of Housing Markets and Analysis, vol. 9 no. 1
Type: Research Article
ISSN: 1753-8270

Keywords

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