Country, sector and regional factors in European property returns

For those portfolio managers who follow a top-down approach to fund management when they are trying to develop a pan-European investment strategy they need to know which are the most important factors affecting property returns, so as to concentrate their management and research efforts accordingly. In order to examine this issue this paper examines the relative importance of country, sector and regional effects in determining property returns across Europe using the largest database of individual property returns currently available. Using annual data over the period 1996 to 2002 for a sample of over 25,000 properties the results show that the country-specific effects dominate sector-specific factors, which in turn dominate the regional-specific factors. This is true even for different sub-sets of countries and sectors. In other words, real estate returns are mainly determined by local (country specific) conditions and are only mildly affected by general European factors. Thus, for those institutional investors contemplating investment into Europe the first level of analysis must be an examination of the individual countries, followed by the prospects of the property sectors within the country and then an assessment of the differences in expected performance between the main city and the rest of the country.

Asymmetric oligopoly and foreign direct investment: implications for host-country tax-setting

We present a duopoly model with heterogeneous firms that vary in cost-efficiency, each of which can choose to serve a foreign market by either exporting or local production. We do so to analyse the effects of a host-country corporate profit tax on both the scale and composition of FDI, and find that: strategic interaction between oligopolistic firms provides for a pattern of FDI that favours cost-inefficiency to the detriment of host-country welfare; and the host-country tax rate can be optimally used to avoid such patterns of FDI and instead promote direct investment by a relatively cost-efficient firm.

Feedback regulation by Atf3 in the endothelin-1-responsive transcriptome of cardiomyocytes: Egr1 is a principal Atf3 target

Endothelin-1 promotes cardiomyocyte hypertrophy by inducing changes in gene expression. Immediate early genes including activating transcription factor 3 (Atf3), Egr1 and Ptgs2 are rapidly and transiently upregulated by endothelin-1 in cardiomyocytes. Atf3 regulates expression of downstream genes and is implicated in negative feedback regulation of other immediate early genes. To identify Atf3-regulated genes, we knocked down Atf3 expression in cardiomyocytes exposed to endothelin-1 and used microarrays to interrogate the transcriptomic effects. Of upregulated mRNAs, expression of 23 (including Egr1, Ptgs2) was enhanced and expression of 25 was inhibited by Atf3 knockdown. Using quantitative PCR, we determined that knockdown of Atf3 had little effect on upregulation of Egr1 mRNA over 30 min, but abolished the subsequent decline, causing sustained Egr1 mRNA expression and enhanced protein expression. This resulted from direct binding of Atf3 to the Egr1 promoter. Mathematical modelling established that Atf3 can suffice to suppress Egr1 expression. Given the widespread co-regulation of Atf3 with Egr1, we suggest that the Atf3-Egr1 negative feedback loop is of general significance. Loss of Atf3 caused abnormal cardiomyocyte growth, presumably resulting from dysregulation of target genes. Our data therefore identify Atf3 as a nexus in cardiomyocyte hypertrophy required to facilitate the full and proper growth response.