Real estate portfolio construction and estimation risk

The use of MPT in the construction real estate portfolios has two serious limitations when used in an ex-ante framework: (1) the intertemporal instability of the portfolio weights and (2) the sharp deterioration in performance of the optimal portfolios outside the sample period used to estimate asset mean returns. Both problems can be traced to wide fluctuations in sample means Jorion (1985). Thus the use of a procedure that ignores the estimation risk due to the uncertain in mean returns is likely to produce sub-optimal results in subsequent periods. This suggests that the consideration of the issue of estimation risk is crucial in the use of MPT in developing a successful real estate portfolio strategy. Therefore, following Eun & Resnick (1988), this study extends previous ex-ante based studies by evaluating optimal portfolio allocations in subsequent test periods by using methods that have been proposed to reduce the effect of measurement error on optimal portfolio allocations.

Asset allocation, cross-class correlation and the structure of property returns

Practical applications of portfolio optimisation tend to proceed on a “top down” basis where funds are allocated first at asset class level (between, say, bonds, cash, equities and real estate) and then, progressively, at sub-class level (within property to sectors, office, retail, industrial for example). While there are organisational benefits from such an approach, it can potentially lead to sub-optimal allocations when compared to a “global” or “side-by-side” optimisation. This will occur where there are correlations between sub-classes across the asset divide that are masked in aggregation – between, for instance, City offices and the performance of financial services stocks. This paper explores such sub-class linkages using UK monthly stock and property data. Exploratory analysis using clustering procedures and factor analysis suggests that property performance and equity performance are distinctive: there is little persuasive evidence of contemporaneous or lagged sub-class linkages. Formal tests of the equivalence of optimised portfolios using top-down and global approaches failed to demonstrate significant differences, whether or not allocations were constrained. While the results may be a function of measurement of market returns, it is those returns that are used to assess fund performance. Accordingly, the treatment of real estate as a distinct asset class with diversification potential seems justified.

Large is fast, small is tight: determinants of speed and affinity in subunit capture by a periplasmic chaperone

The chaperone/usher pathway assembles surface virulence organelles of Gram-negative bacteria, consisting of fibers of linearly polymerized protein subunits. Fiber subunits are connected through 'donor strand complementation': each subunit completes the immunoglobulin (Ig)-like fold of the neighboring subunit by donating the seventh β-strand in trans. Whereas the folding of Ig domains is a fast first-order process, folding of Ig modules into the fiber conformation is a slow second-order process. Periplasmic chaperones separate this process in two parts by forming transient complexes with subunits. Interactions between chaperones and subunits are also based on the principle of donor strand complementation. In this study, we have performed mutagenesis of the binding motifs of the Caf1M chaperone and Caf1 capsular subunit from Yersinia pestis and analyzed the effect of the mutations on the structure, stability, and kinetics of Caf1M-Caf1 and Caf1-Caf1 interactions. The results suggest that a large hydrophobic effect combined with extensive main-chain hydrogen bonding enables Caf1M to rapidly bind an early folding intermediate of Caf1 and direct its partial folding. The switch from the Caf1M-Caf1 contact to the less hydrophobic, but considerably tighter and less dynamic Caf1-Caf1 contact occurs via the zip-out-zip-in donor strand exchange pathway with pocket 5 acting as the initiation site. Based on these findings, Caf1M was engineered to bind Caf1 faster, tighter, or both faster and tighter. To our knowledge, this is the first successful attempt to rationally design an assembly chaperone with improved chaperone function.

Crystal structures of Λ-[Ru(phen)2dppz]2+ with oligonucleotides containing TA/TA and AT/AT steps show two intercalation modes

The ruthenium complex [Ru(phen)2(dppz)] (where phen is a phenanthroline and dppz a dipyridyl–phenazine ligand) is known as a ‘light switch’ complex because its luminescence in solution is significantly enhanced in the presence of DNA. This property is poised to serve in diagnostic and therapeutic applications, but its binding mode with DNA needs to be elucidated further. Here, we describe the crystal structures of the L enantiomer bound to two oligonucleotide duplexes. The dppz ligand intercalates symmetrically and perpendicularly from the minor groove of the d(CCGGTACCGG)2 duplex at the central TA/TA step, but not at the central AT/AT step of d(CCGGATCCGG)2. In both structures, however, a second ruthenium complex links the duplexes through the combination of a shallower angled intercalation into the C1C2/G9G10 step at the end of the duplex, and semi-intercalation into the G3G4 step of an adjacent duplex. The TA/TA specificity of the perpendicular intercalation arises from the packing of phenanthroline ligands against the adenosine residue.

pH-tunable hydrogelators for water purification: structural optimisation and evaluation

A focused library of potential hydrogelators each containing two substituted aromatic residues separated by a urea or thiourea linkage have been synthesised and characterized. Six of these novel compounds are highly efficient hydrogelators, forming gels in aqueous solution at low concentrations (0.03–0.60 wt %). Gels were formed through a pH switching methodology, by acidification of a basic solution (pH 14 to ≈4) either by addition of HCl or via the slow hydrolysis of glucono-δ-lactone. Frequently, gelation was accompanied by a dramatic switch in the absorption spectra of the gelators, resulting in a significant change in colour, typically from a vibrant orange to pale yellow. Each of the gels was capable of sequestering significant quantities of the aromatic cationic dye, methylene blue, from aqueous solution (up to 1.02 g of dye per gram of dry gelator). Cryo-transmission electron microscopy of two of the gels revealed an extensive network of high aspect ratio fibers. The structure of the fibers altered dramatically upon addition of 20 wt % of the dye, resulting in aggregation and significant shortening of the fibrils. This study demonstrates the feasibility for these novel gels finding application as inexpensive and effective water purification platforms.

Assessing the impact of occupant behaviour on the electricity consumption for lighting and small power in office buildings

Lighting and small power will typically account for more than half of the total electricity consumption in an office building. Significant variations in electricity used by different tenants suggest that occupants can have a significant impact on the electricity demand for these end-uses. Yet current modelling techniques fail to represent the interaction between occupant and the building environment in a realistic manner. Understanding the impact of such behaviours is crucial to improve the methodology behind current energy modelling techniques, aiming to minimise the significant gap between predicted and in-use performance of buildings. A better understanding of the impact of occupant behaviour on electricity consumption can also inform appropriate energy saving strategies focused on behavioural change. This paper reports on a study aiming to assess the intent of occupants to switch off lighting and appliances when not in use in office buildings. Based on the Theory of Planned Behaviour, the assessment takes the form of a questionnaire and investigates three predictors to behaviour individually: 1) behavioural attitude; 2) subjective norms; 3) perceived behavioural control. The paper details the development of the assessment procedure and discusses preliminary findings from the study. The questionnaire results are compared against electricity consumption data for individual zones within a multi-tenanted office building. Initial results demonstrate a statistically significant correlation between perceived behavioural control and energy consumption for lighting and small power

Simulation of a domestic ground source heat pump system using a three-dimensional numerical borehole heat exchanger model

Common approaches to the simulation of borehole heat exchangers (BHEs) assume heat transfer in circulating fluid and grout to be in a quasi-steady state and ignore fluctuations in fluid temperature due to transport of the fluid around the loop. However, in domestic ground source heat pump (GSHP) systems, the heat pump and circulating pumps switch on and off during a given hour; therefore, the effect of the thermal mass of the circulating fluid and the dynamics of fluid transport through the loop has important implications for system design. This may also be important in commercial systems that are used intermittently. This article presents transient simulation of a domestic GSHP system with a single BHE using a dynamic three-dimensional (3D) numerical BHE model. The results show that delayed response associated with the transit of fluid along the pipe loop is of some significance in moderating swings in temperature during heat pump operation. In addition, when 3D effects are considered, a lower heat transfer rate is predicted during steady operations. These effects could be important when considering heat exchanger design and system control. The results will be used to develop refined two-dimensional models.

Vegetation and environmental dynamics in the southern Black Sea region since 18 kyr BP derived from the marine core 22-GC3

Sediments from the Black Sea, a region historically dominated by forests and steppe landscapes, are a valuable source of detailed information on the changes in regional terrestrial and aquatic environments at decadal to millennial scales. Here we present multi-proxy environmental records (pollen, dinoflagellate cysts, Ca, Ti and oxygen isotope data) from the uppermost 305 cm of the core 22-GC3 (42°13.53′N, 36°29.55′E) collected from a water depth of 838 m in the southern part of the Black Sea in 2007. The records span the last ~ 18 kyr (all ages are given in cal kyr BP). The pollen data reveal the dominance of the Artemisia-steppe in the region, suggesting rather dry/cold environments ~ 18–14.5 kyr BP. Warming/humidity increase during melt-water pulses (~ 16.1–14.5 kyr BP), indicated by δ18O records from the 22-GC3 core sediment and from the Sofular Cave stalagmite, is expressed in more negative δ13C values from the Sofular Cave, usually interpreted as the spreading of C3 plants. The records representing the interstadial complex (~ 14.5–12.9 kyr BP) show an increase in temperature and moisture, indicated by forest development, increased primary productivity and reduced surface run-off, whereas the switch from primary terrigenous to primary authigenic Ca origin occurs ~ 500 yr later. The Younger Dryas cooling is clearly demonstrated by more negative δ13C values from the Sofular Cave and a reduction of pines. The early Holocene (11.7–8.5 kyr BP) interval reveals relatively dry conditions compared to the mostly moist and warm middle Holocene (8.5–5 kyr BP), which is characterized by the establishment of the species-rich warm mixed and temperate deciduous forests in the low elevation belt, temperate deciduous beech-hornbeam forests in the middle and cool conifer forest in upper mountain belt. The border between the early and middle Holocene in the vegetation records coincides with the opening of the Mediterranean corridor at ~ 8.3 kyr BP, as indicated by a marked change in the dinocyst assemblages and in the sediment lithology. Changes in the pollen assemblages indicate a reduction in forest cover after ~ 5 kyr BP, which was likely caused by increased anthropogenic pressure on the regional vegetation.

Electrochromic and electrofluorochromic properties of a new boron dipyrromethene–ferrocene conjugate

A new boron dipyrromethene–ferrocene (BODIPY–Fc) conjugate with pentafluorophenyl as the meso substituent and two Fc termini was synthesized and its spectroscopic and electrochemical features were analyzed. An intramolecular charge transfer from the donor Fc to the acceptor BODIPY has been predicted by theory and confirmed experimentally, leading to efficient fluorescence quenching when the dyad is in the neutral state. Fluorescence can be triggered by oxidizing both ferrocenyl units either chemically or electrochemically. Eventually, a fully reversible fluorescence switch is evidenced by coupling TIRF microscopy with electrolysis in an electrochemical cell.

Safety and quality and stage of distribution

Let 0 denote the level of quality inherent in a food product that is delivered to some terminal market. In this paper, I characterize allocations over 0 and provide an economic rationale for regulating safety and quality standards in the food system. Zusman and Bockstael investigate the theoretical foundations for imposing standards and stress the importance of providing a tractable conceptual foundation. Despite a wealth of contributions that are mainly empirical (for reviews of these works see, respectively, Caswell and Antle), there have been relatively few attempts to model formally the linkages between farm and food markets when food quality and consumer safety are at issue. Here, I attempt to provide such a framework, building on key contributions in the theoretical literature and linking them in a simple model of quality determination in a vertically related marketing channel. The food-marketing model is due to Gardner. Spence provides a foundation for Pareto-improving intervention in a deterministic model of quality provision, and Leland, building on the classic paper by Akerlof, investigates licensing and minimum standards when the information structure is incomplete. Linking these ideas in a satisfactory model of the food markets is the main objective of the paper.

International office investment in global cities: the production of financial space and systemic risk

The paper explores the relationships between UK commercial real estate and regional economic development as a foundation for the analysis of the role of real estate investment in local economic development. Linkages between economic growth, development, real estate performance and investment allocations are documented. Long-run regional property performance is not the product of long-run economic growth, and weakly related to indicators of long-run supply and demand. Changes in regional portfolio weights seem driven by neither market performance nor underlying fundamentals. In the short run, regional investment shifts show no clear leads or lags with market performance.

Preferred orientation in an angled intercalation site of a chloro-substituted lambda- [Ru(TAP)2(dppz)]2+ complex bound to d(TCGGCGCCGA)2

The crystal structure of the ruthenium DNA ‘light-switch’ complex -[Ru(TAP)2(11-Cl-dppz)]2+ (TAP = tetraazaphenanthrene, dppz = dipyrido[3,2-a':2',3'-c]phenazine)) bound to the oligonucleotide duplex d(TCGGCGCCGA)2 is reported. The synthesis of the racemic ruthenium complex is described for the first time, and the racemate was used in this study. The crystal structure, at atomic resolution (1.0 Å), shows one ligand as a wedge in the minor groove, resulting in the 51 kinking of the double helix, as with the parent lambda-[Ru(TAP)2(dppz)]2+. Each complex binds to one duplex by intercalation of the dppz ligand and also by semi-intercalation of one of the orthogonal TAP ligands into a second symmetrically equivalent duplex. The 11-Cl substituent binds with the major component (66%) oriented with the 11-chloro substituent on the purine side of the terminal step of the duplex.

House price dynamics and their reaction to macroeconomic changes

This article applies a three-regime Markov switching model to investigate the impact of the macroeconomy on the dynamics of the residential real estate market in the US. Focusing on the period between 1960 and 2011, the methodology implemented allows for a clearer understanding of the drivers of the real estate market in “boom”, “steady-state” and “crash” regimes. Our results show that the sensitivity of the real estate market to economic changes is regime-dependent. The paper then proceeds to examine whether policymakers are able to influence a regime switch away from the crash regime. We find that a decrease in interest rate spreads could be an effective catalyst to precipitate such a change of state.

Analytical calculation of resonant inductance for zero voltage switching in phase-shifted full-bridge converters

The phase shift full bridge (PSFB) converter allows high efficiency power conversion at high frequencies through zero voltage switching (ZVS); the parasitic drain-to-source capacitance of the MOSFET is discharged by a resonant inductance before the switch is gated resulting in near zero turn-on switching losses. Typically, an extra inductance is added to the leakage inductance of a transformer to form the resonant inductance necessary to charge and discharge the parasitic capacitances of the PSFB converter. However, many PSFB models do not consider the effects of the magnetizing inductance or dead-time in selecting the resonant inductance required to achieve ZVS. The choice of resonant inductance is crucial to the ZVS operation of the PSFB converter. Incorrectly sized resonant inductance will not achieve ZVS or will limit the load regulation ability of the converter. This paper presents a unique and accurate equation for calculating the resonant inductance required to achieve ZVS over a wide load range incorporating the effects of the magnetizing inductance and dead-time. The derived equations are validated against PSPICE simulations of a PSFB converter and extensive hardware experimentations.

Early metabolic adaptation in C57BL/6 mice resistant to high fat diet induced weight gain involves an activation of mitochondrial oxidative pathways

We investigated the short-term (7 days) and long-term (60 days) metabolic effect of high fat diet induced obesity (DIO) and weight gain in isogenic C57BL/6 mice and examined the specific metabolic differentiation between mice that were either strong-responders (SR), or non-responders (NR) to weight gain. Mice (n = 80) were fed a standard chow diet for 7 days prior to randomization into a high-fat (HF) (n = 56) or a low-fat (LF) (n = 24) diet group. The (1)H NMR urinary metabolic profiles of LF and HF mice were recorded 7 and 60 days after the diet switch. On the basis of the body weight gain (BWG) distribution of HF group, we identified NR mice (n = 10) and SR mice (n = 14) to DIO. Compared with LF, HF feeding increased urinary excretion of glycine conjugates of β-oxidation intermediate (hexanoylglycine), branched chain amino acid (BCAA) catabolism intermediates (isovalerylglycine, α-keto-β-methylvalerate and α-ketoisovalerate) and end-products of nicotinamide adenine dinucleotide (NAD) metabolism (N1-methyl-2-pyridone-5-carboxamide, N1-methyl-4-pyridone-3-carboxamide) suggesting up-regulation of mitochondrial oxidative pathways. In the HF group, NR mice excreted relatively more hexanoylglycine, isovalerylglycine, and fewer tricarboxylic acid (TCA) cycle intermediate (succinate) in comparison to SR mice. Thus, subtle regulation of ketogenic pathways in DIO may alleviate the saturation of the TCA cycle and mitochondrial oxidative metabolism.