Commercial real estate return distributions: a review of literature and empirical evidence

This paper review the literature on the distribution of commercial real estate returns. There is growing evidence that the assumption of normality in returns is not safe. Distributions are found to be peaked, fat-tailed and, tentatively, skewed. There is some evidence of compound distributions and non-linearity. Public traded real estate assets (such as property company or REIT shares) behave in a fashion more similar to other common stocks. However, as in equity markets, it would be unwise to assume normality uncritically. Empirical evidence for UK real estate markets is obtained by applying distribution fitting routines to IPD Monthly Index data for the aggregate index and selected sub-sectors. It is clear that normality is rejected in most cases. It is often argued that observed differences in real estate returns are a measurement issue resulting from appraiser behaviour. However, unsmoothing the series does not assist in modelling returns. A large proportion of returns are close to zero. This would be characteristic of a thinly-traded market where new information arrives infrequently. Analysis of quarterly data suggests that, over longer trading periods, return distributions may conform more closely to those found in other asset markets. These results have implications for the formulation and implementation of a multi-asset portfolio allocation strategy.

Individual assets, market structure and the drivers of return

Much UK research and market practice on portfolio strategy and performance benchmarking relies on a sector‐geography subdivision of properties. Prior tests of the appropriateness of such divisions have generally relied on aggregated or hypothetical return data. However, the results found in aggregate may not hold when individual buildings are considered. This paper makes use of a dataset of individual UK property returns. A series of multivariate exploratory statistical techniques are utilised to test whether the return behaviour of individual properties conforms to their a priori grouping. The results suggest strongly that neither standard sector nor regional classifications provide a clear demarcation of individual building performance. This has important implications for both portfolio strategy and performance measurement and benchmarking. However, there do appear to be size and yield effects that help explain return behaviour at the property level.

Repetitive visiting as a pre-return transnational strategy among youthful Trinidad returnees

Building upon existing Caribbean research by Condon and Duval, we assess how repetitive visiting is, or is not, important to youthful return migrants in their 30s and 40s, who have decided to return more permanently to Trinidad. Is it influential in their social and economic adaptations on return, and does this transnational practice lead to a more permanent return? Our analysis is based on 40 detailed narratives which were collected in 2004-2005. For some returnees, repetitive visiting is influential, for others one visit is enough and for a few, it makes no difference. Yet it is certainly a common practice for 'keeping in touch' among our transnational informants.

Questions of Friendship and Degrees of Transnationality among Second-Generation Return Migrants to Barbados

While the academic literature has demonstrated the importance of social networks in relation to the process of migration, investigations have rarely examined in detail the personal-social adjustment issues that migrants and return migrants face. This study examines the context and types of friendship pattern that young return migrants from Britain cultivate in Barbados. The research centres on a wholly under-researched demographic groupyoung return migrants or second-generation Barbadians who have decided to return to the birthplace of their parents. The investigation is based on 51 in-depth interviews carried out with these young returnees to Barbados. Presenting a taxonomy of friendship types, it is argued that, for the 'Bajan-Brits' under study, the cultivation of new friendships is highly problematic. The research identifies what we refer to as the 'insular transnational', the 'we are different' and the 'all-inclusive transnational' friendship types among the young returnees. Our analysis also shows that problems of friendship are highly gendered, with females reporting the most problems due to what is perceived as sexual and workplace competition. It is stressed that these circumstances exemplify the essentially 'hybrid', 'liminal' and 'in-between' positionality of these second-generation migrants within contemporary Barbadian society.

'Black skins-white masks': Postcolonial reflections on 'race', gender and second generation return migration to the Caribbean

This paper illustrates the opportunities afforded by the adoption of postcolonial discourse in development geography, drawing specifically on issues of transnationalism, hybridity and inbetweeness. The utility of such notions and associated approaches is illustrated by the authors' current research on the migration of young, second generation and foreign-born 'Bajan-Brits' to the small Caribbean island nation of Barbados, the homeland of their parents. Focussing on issues of 'race' and gender, the paper examines the experiences of return migration among this cohort from an interpretative perspective framed within postcolonial discourse. It argues that notwithstanding the considerable sociocultural problems of adjustment encountered, these Bajan-Brit 'returnees' may be seen as occupying positions of relative economic privilege. Theirs is a liminal space derived by virtue of having been born and/or raised in the UK and being of the black 'race'. Accordingly, they are demonstrated to be both advantaged and disadvantaged; both transnational and national; and black but, in some senses, symbolically white.