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.

Futures trading, spot price volatility and market efficiency: evidence from European real estate securities futures

In 2007 futures contracts were introduced based upon the listed real estate market in Europe. Following their launch they have received increasing attention from property investors, however, few studies have considered the impact their introduction has had. This study considers two key elements. Firstly, a traditional Generalized Autoregressive Conditional Heteroskedasticity (GARCH) model, the approach of Bessembinder & Seguin (1992) and the Gray’s (1996) Markov-switching-GARCH model are used to examine the impact of futures trading on the European real estate securities market. The results show that futures trading did not destabilize the underlying listed market. Importantly, the results also reveal that the introduction of a futures market has improved the speed and quality of information flowing to the spot market. Secondly, we assess the hedging effectiveness of the contracts using two alternative strategies (naïve and Ordinary Least Squares models). The empirical results also show that the contracts are effective hedging instruments, leading to a reduction in risk of 64 %.

The dilemma of scope and scale for construction professional service firms

Construction professional service (CPS) firms sell expertise and provide innovative solutions for projects founded on their knowledge, experience, and technical competences. Large CPS firms seeking to grow will often seek new opportunities in their domestic market and overseas by organic or inorganic growth through mergers, alliances, and acquisitions. Growth can also come from increasing market penetration through vertical, horizontal, and lateral diversification. Such growth, hopefully, leads to economies of scope and scale in the long term, but it can also lead to diseconomies, when the added cost of integration and the increased complexity of diversification no longer create tangible and intangible benefits. The aim of this research is to investigate the key influences impacting on the growth in scope and scale for large CPS firms. Qualitative data from the interviews were underpinned by secondary data from CPS firms’ annual reports and analysts’ findings. The findings showed five key influences on the scope and scale of a CPS firm: the importance of growth as a driver; the influence of the ownership of the firm on the decision for growth in scope and scale; the optimization of resources and capabilities; the need to serve changing clients’ needs; and the importance of localization. The research provides valuable insights into the growth strategies of international CPS firms. A major finding of the research is the influence of ownership on CPS firms’ growth strategies which has not been highlighted in previous research.

Spiritual capital: the co-evolution of an ethical framework based on Abrahamic religious values in the Islamic tradition

Purpose – The aim of this paper is to investigate how values from within Abrahamic religions could be adopted to improve liberal market economies’ (LMEs’) corporate governance business practices. Design/methodology/approach – The concept of spiritual capitalism is explained from an Islamic perspective by adopting three universal Abrahamic values to critically analyse LMEs and offer an ethical alternative to current capitalism concerns. Findings – It is found that LMEs can be improved by considering all stakeholders, putting ethics before economics, and introducing shared risk/reward plus lower debt. Originality/value – The paper compares LMEs/Co-ordinated market economies (CMEs)/Islamic countries economies (ICEs) within an ethical framework for LMEs.

Environmental justice and conceptions of the green economy

Green economy has become one of the most fashionable terms in global environmental public policy discussions and forums. Despite this popularity, and its being selected as one of the organizing themes of the United Nations Rio+20 Conference in Brazil, June 2012, its prospects as an effective mobilization tool for global environmental sustainability scholarship and practice remains unclear. A major reason for this is that much like its precursor concepts such as environmental sustainability and sustainable development, green economy is a woolly concept which lends itself to many interpretations. Hence, rather than resolve long-standing controversies, green economy merely reinvigorates existing debates over the visions, actors and policies best suited to secure a more sustainable future for all. In this review article, we aim to fill an important gap in scholarship by suggesting various ways in which green economy may be organized and synthesized as a concept, and especially in terms of its relationship with the idea of social and environmental justice. Accordingly, we offer a systemization of possible interpretations of green economy mapped onto a synthesis of existing typologies of environmental justice. This classification provides the context for future analysis of which, and how, various notions of green economy link with various conceptions of justice.

Public real estate and the term structure of interest rates: a cross-country study

Using a variation of the Nelson-Siegel term structure model we examine the sensitivity of real estate securities in six key global markets to unexpected changes in the level, slop and curvature of the yield curve. Our results confirm the time-sensitive nature of the exposure and sensitivity to interest rates and highlight the importance of considering the entire term structure of interest rates. One issue that is of particular of interest is that despite the 2007-9 financial crisis the importance of unanticipated interest rate risk weakens post 2003. Although the analysis does examine a range of markets the empirical analysis is unable to provide definitive evidence as to whether REIT and property-company markets display heightened or reduced exposure.

The co-development of technology and new buildings: incorporating building integrated photovoltaics

Current approaches for the reduction of carbon emissions in buildings are often predicated on the integration of renewable technologies into building projects. Building integrated photovoltaics (BIPV) is one of these technologies and brings its own set of challenges and problems with a resulting mutual articulation of this technology and the building. A Social Construction of Technology (SCOT) approach explores how negotiations between informal groups of project actors with shared interests shape the ongoing specification of both BIPV and the building. Six main groups with different interests were found to be involved in the introduction of BIPV (Cost Watchers, Design Aesthetes, Green Guardians, Design Optimizers, Generation Maximizers and Users). Their involvement around three sets of issues (design changes from lack of familiarity with the technology, misunderstandings from unfamiliar interdependencies of trades and the effects of standard firm procedure) is followed. Findings underline how BIPV requires a level of integration that typically spans different work packages and how standard contractual structures inhibit the smooth incorporation of BIPV. Successful implementation is marked by ongoing (re-)design of both the building and the technology as informal fluid groups of project actors with shared interests address the succession of problems which arise in the process of implementation.

Economic evidence in regulatory disputes: revisiting the court-regulatory agency relationship in the US and the UK

This article examines the issue of the appropriate scope of review of economic evidence enshrined in the discretionary assessments of utility regulators in the US and the UK. It advances a balance of institutional competencies approach to the question of the degree of deference owed to the regulatory agency’s economic assessments. In doing so, it revisits the doctrinal positions advanced in the US and UK for the substantive review of administrative discretion, so as to become attuned to the challenges posed by economic evidence. Drawing on insights from political science and economics, the suggested approach illuminates the institutional disadvantages of the courts that may warrant a high degree of deference. At the same time, however, it remains sensitive to the polycentric elements of regulatory disputes as well as to a number of institutional realties that may attenuate the weight of such comparative institutional disadvantages.

Scoring rules and abnormally low bids criteria in construction tenders: a taxonomic review

In the global construction context, the best value or most economically advantageous tender is becoming a widespread approach for contractor selection, as an alternative to other traditional awarding criteria such as the lowest price. In these multi-attribute tenders, the owner or auctioneer solicits proposals containing both a price bid and additional technical features. Once the proposals are received, each bidder’s price bid is given an economic score according to a scoring rule, generally called an economic scoring formula (ESF) and a technical score according to pre-specified criteria. Eventually, the contract is awarded to the bidder with the highest weighted overall score (economic + technical). However, economic scoring formula selection by auctioneers is invariably and paradoxically a highly intuitive process in practice, involving few theoretical or empirical considerations, despite having been considered traditionally and mistakenly as objective, due to its mathematical nature. This paper provides a taxonomic classification of a wide variety of ESFs and abnormally low bids criteria (ALBC) gathered in several countries with different tendering approaches. Practical implications concern the optimal design of price scoring rules in construction contract tenders, as well as future analyses of the effects of the ESF and ALBC on competitive bidding behaviour.

Protocol for ACCESS: a qualitative study exploring barriers and facilitators to accessing the emergency contraceptive pill from community pharmacies in Australia

Introduction The rate of unplanned pregnancy in Australia remains high, which has contributed to Australia having one of the highest abortion rates of developed countries with an estimated 1 in 5 women having an abortion. The emergency contraceptive pill (ECP) offers a safe way of preventing unintended pregnancy after unprotected sex has occurred. While the ECP has been available over-the-counter in Australian pharmacies for over a decade, its use has not significantly increased. This paper presents a protocol for a qualitative study that aims to identify the barriers and facilitators to accessing the ECP from community pharmacies in Australia. Methods and analysis Data will be collected through one-on-one interviews that are semistructured and in-depth. Partnerships have been established with 2 pharmacy groups and 2 women's health organisations to aid with the recruitment of women and pharmacists for data collection purposes. Interview questions explore domains from the Theoretical Domains Framework in order to assess the factors aiding and/or hindering access to ECP from community pharmacies. Data collected will be analysed using deductive content analysis. The expected benefits of this study are that it will help develop evidence-based workforce interventions to strengthen the capacity and performance of community pharmacists as key ECP providers. Ethics and dissemination The findings will be disseminated to the research team and study partners, who will brainstorm ideas for interventions that would address barriers and facilitators to access identified from the interviews. Dissemination will also occur through presentations and peer-reviewed publications and the study participants will receive an executive summary of the findings. The study has been evaluated and approved by the Monash Human Research Ethics Committee.

Pension scheme redesign and wealth redistribution between the members and sponsor: the USS rule change in October 2011

The redesign of defined benefit pension schemes usually results in a substantial redistribution of wealth between age cohorts of members, pensioners, and the sponsor. This is the first study to quantify the redistributive effects of a rule change by a real world scheme (the Universities Superannuation Scheme, USS) where the sponsor underwrites the pension promise. In October 2011 USS closed its final salary scheme to new members, opened a career average revalued earnings (CARE) section, and moved to ‘cap and share’ contribution rates. We find that the pre-October 2011 scheme was not viable in the long run, while the post-October 2011 scheme is probably viable in the long run, but faces medium term problems. In October 2011 future members of USS lost 65% of their pension wealth (or roughly £100,000 per head), equivalent to a reduction of roughly 11% in their total compensation, while those aged over 57 years lost almost nothing. The riskiness of the pension wealth of future members increased by a third, while the riskiness of the present value of the sponsor’s future contributions reduced by 10%. Finally, the sponsor’s wealth increased by about £32.5 billion, equivalent to a reduction of 26% in their pension costs.

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.