Nonlocal office investors: anchored by their markets and impaired by their distance

Nonlocal investors purchase and sell investment property in a distant metropolitan area. In this study, we identify capital value underperformance for nonlocal investors on both sides of the transaction, when they purchase and when they sell. The commercial real estate transactions data include a national sample of office property occurring in more than 100 U.S. markets. Using propensity-score matched sample to control for selection bias, we find that nonlocal investors overpay on the purchase by an estimated 13.8 % and sell at an estimated 7 % discount. These disadvantages relative to local investors expand with the geographic distance separating investor and asset. Nonlocal investors fundamentally overvalue similar assets sold to each other relative to assets transacted between locals, and are less patient as sellers. The positive bias in overpayment is directly tied to office rent differentials between the asset and investor markets.

Urban economic openness and IPO underpricing

We examine the empirical impact of trade openness on the short-run underpricing of initial public offerings (IPOs) using city-level real estate data. This paper represents a first attempt to employ a macroeconomic approach to explain IPO performance. We investigate an openness effect in which urban economic openness (UEO) has a significant impact on the productivity and on the prices of both direct and indirect real estate due to productivity gains of companies in more open areas. This in turn positively affects the firm’s profitability, enhancing the confidence in the local real estate market and the future company performance and decreasing the uncertainty of the IPO valuation. And as a result, we find that issuers have less incentive to underprice the IPO shares. China provides a suitable experimental ground to study the immense underpricing in developing markets, which cannot solely be accounted for by firm specific effects. First, Chinese real estate companies show strong geographic patterns focusing their businesses locally – usually at a city level. Second, we observe a degree of openness which is significantly heterogeneous across Chinese cities. Controlling for company-specific variables, location and state ownership, we find the evidence that companies whose businesses are in economically more open areas experience less IPO underpricing. Our results show high explanatory power and are robust to diverse specifications.

Moody's manual of investments : American and foreign.

1911 not published.

Risk and structural instability in US house prices

This paper employs a Component GARCH in Mean model to show that house prices across a number of major US cities between 1987 and 2009 have displayed asset market properties in terms of both risk-return relationships and asymmetric adjustment to shocks. In addition, tests for structural breaks in the mean and variance indicate structural instability across the data range. Multiple breaks are identified across all cities, particularly for the early 1990s and during the post-2007 financial crisis as housing has become an increasingly risky asset. Estimating the models over the individual sub-samples suggests that over the last 20 years the financial sector has increasingly failed to account for the levels of risk associated with real estate markets. This result has possible implications for the way in which financial institutions should be regulated in the future.

The RTC : in the midst of America's real estate crisis : hearing before the Subcommittee on Financial Institutions Supervision, Regulation and Insurance, Resolution Trust Corporation Task Force of the Committee on Banking, Finance, and Urban Affairs, House of Representatives, One Hundred Second Congress, first session, July 26, 1991.

"Serial no. 102-64."

Credit availability for small businesses, real estate, housing, and consumers : field hearing before the Subcommittee on Economic Growth and Credit Formation of the Committee on Banking, Finance, and Urban Affairs, House of Representatives, One Hundred Third Congress, first session, August 30, 1993.

Mode of access: Internet.

Occupational employment statistics : 1984 survey of selected Illinois nonmanufacturing establishments : mining, construction, finance-insurance-real estate, and services.

Cover title: Occupational employment statistics for Illinois, selected nonmanufacturing industries, 1984.

Occupational employment statistics : mining, construction, and finance-insurance-real estate.

"June 1993."

Federal estate and gift taxes, recommendations for modifications in the system of taxing estates and gifts; report of Committee on federal finance.

Cover-title.

Occupational employment in mining, construction, finance, real estate, personal services, and business services, West Virginia, 1984 /

Bibliography: p. 89.