Decision-making factors in the constitution of a REIT
Document typeConference report
Rights accessOpen Access
Real Estate Investment Trusts (hereinafter, REIT) are investment companies which enable to capitalize real estate assets by offering company shares into stock markets. The recent positive outlook and the signs of change in the economic cycle have entailed a sharp increase of REITs constitutions. Nevertheless, real estate managers must consider its advantages compared to other alternatives of financing real estate activity. This implies the analysis of those variables affecting REITs performance such as, market price and market capitalization (compared to its net asset value), REIT expected liquidity, constitution costs, systematic risk, finance costs or tax benefits, and also other aspects like, company control, transparency requirements or regulatory limits. REITs have become a competitive way to finance real estate activity, especially considering credit constraints this industry is still experiencing. In this context, the present paper analyses what should be taken into account in the decision of establishing a REIT.
CitationSoriano, J.M., Roig, J. Decision-making factors in the constitution of a REIT. A: Congresso Internacional de Contabilidade e Auditoria. "Comunicaçao do XV Congresso Internacional de Contabilidade e Auditoria : A Contabilidade e o Interesse Público : 11 e 12 de Junho de 2015, Coimbra". coimbra: 2015, p. 1-10.