Efficiency measurement of real estate investment trusts traded in BIST with data envelopment analysis and Malmquist total factor productivity index

Abstract

Purpose- The aim of the study is to measure the efficiency of real estate investment trusts traded on BIST with data envelopment analysis and the Malmquist total factor productivity index. Efficiency and productivity were measured using the Malmquist total productivity analysis and the Data Envelopment Analysis approach, both of whose application fields have grown recently. Methodology- The Malmquist total factor productivity index is used to analyze changes in total factor productivity of 20 real estate investment trusts operating in 2019–2020–2021, as well as the reasons for these changes, on the axis of variables such as current ratio, leverage ratio, long-term debt-to-asset ratio, short-term debt-to-asset ratio, equity-to-asset ratio, return on assets, net profit margin, and gross profit margin. Findings- The results of the analysis show that 8 companies that are relatively efficient according to their CCR technical efficiency values have been identified; these are ALGYO, AVGYO, HLGYO, MRGYO, MSGYO, PAGYO, RYGYO, and SNGYO. It has been observed that these companies have been effective in an output-oriented way over the past three years. Conclusion- The firms that are below the efficiency limit need to take a few things into account, according to the results. They need to alter a few input variables to reach a higher level of efficiency. It is anticipated that all these findings will support the decision-making of the companies and the investors who are considering investing in these companies. Keywords: Real estate investment trusts, data envelopment analysis, Malmquist total factor productivity index, efficiency measurement. JEL Codes: C67, L25, G29