Individual assets, market structure and the drivers of return

Much prior research on the structure and performance of UK real estate portfolios has relied on aggregated measures for sector and region. For these groupings to have validity, the performance of individual properties within each group should be similar. This paper analyses a sample of 1,200 properties using multiple discriminant analysis and cluster analysis techniques. It is shown that conventional property type and spatial classifications do not capture the variation in return behaviour at the individual building level. The major feature is heterogeneity - but there may be distinctions between growth and income properties and between single and multi-let properties that could help refine portfolio structures.

Taking the LEED? Analyzing spatial variations in market penetration rates of eco-labeled properties

This paper investigates the impact of policies to promote the adoption of LEED-certified buildings across CBSA in the United States. Drawing upon a unique database that combines data from a large number of sources and using a number of regression procedures, the determinants of the proportion LEED-certified space for more than 170 CBSA in the US is modeled. LEED-certified space still accounts for a relatively small proportion of commercial stock in all markets. The average proportion is less than 1%. There is no conclusive evidence of a positive impact of policy intervention on the levels of LEED-certified space. However, after accounting for bias introduced by non-random assignment of policies, we find preliminary evidence of a positive impact of city-level green building incentives. There is a significant positive association between market size and indicators of economic vitality on proportions of LEED-certified space.

Towards an improved understanding of farmers' behaviour: the integrative agent-centred (IAC) framework

An effective approach to research on farmers' behaviour is based on: i) an explicit and well-motivated behavioural theory; ii) an integrative approach; and iii) understanding feedback processes and dynamics. While current approaches may effectively tackle some of them, they often fail to combine them together. The paper presents the integrative agent-centred (IAC) framework, which aims at filling this gap. It functions in accordance with these three pillars and provides a conceptual structure to understand farmers' behaviour in agricultural systems. The IAC framework is agent-centred and supports the understanding of farmers' behavior consistently with the perspective of agricultural systems as complex social-ecological systems. It combines different behavioural drivers, bridges between micro and macro levels, and depicts a potentially varied model of human agency. The use of the framework in practice is illustrated through two studies on pesticide use among smallholders in Colombia. The examples show how the framework can be implemented to derive policy implications to foster a transition towards more sustainable agricultural practices. The paper finally suggests that the framework can support different research designs for the study of agents' behaviour in agricultural and social-ecological systems.

The impact of news on measures of undiversifiable risk: evidence from the UK stock market

Using UK equity index data, this paper considers the impact of news on time varying measures of beta, the usual measure of undiversifiable risk. The empirical model implies that beta depends on news about the market and news about the sector. The asymmetric response of beta to news about the market is consistent across all sectors considered. Recent research is divided as to whether abnormalities in equity returns arise from changes in expected returns in an efficient market or over-reactions to new information. The evidence suggests that such abnormalities may be due to changes in expected returns caused by time-variation and asymmetry in beta.

“Financial alchemy” or a zero sum game? Real estate finance, securitisation and the UK property market

Following the US model, the UK has seen considerable innovation in the funding, finance and procurement of real estate in the last decade. In the growing CMBS market asset backed securitisations have included $2.25billion secured on the Broadgate office development and issues secured on Canary Wharf and the Trafford Centre regional mall. Major occupiers (retailer Sainsbury’s, retail bank Abbey National) have engaged in innovative sale & leaseback and outsourcing schemes. Strong claims are made concerning the benefits of such schemes – e.g. British Land were reported to have reduced their weighted cost of debt by 150bp as a result of the Broadgate issue. The paper reports preliminary findings from a project funded by the Corporation of London and the RICS Research Foundation examining a number of innovative schemes to identify, within a formal finance framework, sources of added value and hidden costs. The analysis indicates that many of the gains claimed conceal costs – in terms of market value of debt or flexibility of management – while others result from unusual firm or market conditions (for example utilising the UK long lease and the unusual shape of the yield curve). Nonetheless, there are real gains resulting from the innovations, reflecting arbitrage and institutional constraints in the direct (private) real estate market

Farmers' management of rice varietal diversity in the mid-hills of Nepal: implications for on-farm conservation and crop improvement

Season-long monitoring of on-farm rice (Oryza sativa, L.) plots in Nepal explored farmers' decision-making process on the deployment of varieties to agroecosystems, application of production inputs to varieties, agronomic practices and relationship between economic return and area planted per variety. Farmers deploy varieties [landraces (LRs) and modern varieties (MVs)] to agroecosystems based on their understanding of characteristics of varieties and agroecosystems, and the interaction between them. In marginal growing conditions, LRs can compete with MVs. Within an agroecosystem, economic return and area planted to varieties have positive relationship, but this is not so between agroecosystems. LRs are very diverse on agronomic and economic traits; therefore, they cannot be rejected a priori as inferior materials without proper evaluation. LRs have to be evaluated for useful traits and utilized in breeding programmes to generate farmer-preferred materials for marginal environments and for their conservation on-farm.

On-farm management of rice genetic diversity: understanding farmers' knowledge on rice ecosystems and varietal development

The paper highlights the methodological development of identifying and characterizing rice (Oryza sativa L.) ecosystems and the varietal deployment process through participatory approaches. Farmers have intricate knowledge of their rice ecosystems. Evidence from Begnas (mid-hill) and Kachorwa (plain) sites in Nepal suggests that farmers distinguish ecosystems for rice primarily on the basis of moisture and fertility of soils. Farmers also differentiate the number, relative size and specific characteristics of each ecosystem within a given geographic area. They allocate individual varieties to each ecosystem, based on the principle of ‘best fit’ between ecosystem characteristics and varietal traits, indicating that competition between varieties mainly occurs within the ecosystems. Land use and ecosystems determine rice genetic diversity, with marginal land having fewer options for varieties than more productive areas. Modern varieties are mostly confined to productive land, whereas landraces are adapted to marginal ecosystems. Researchers need to understand the ecosystems and varietal distribution within ecosystems better in order to plan and execute programmes on agrobiodiversity conservation on-farm, diversity deployment, repatriation of landraces and monitoring varietal diversity. Simple and practical ways to elicit information on rice ecosystems and associated varieties through farmers’ group discussion at village level are suggested.