Perspective Of Institutional Investors Research Articles

Owner‐occupied housing and household asset allocation

This second of two related papers in this Journal, reviews empirical evidence available from the literature on the problem of household's optimal portfolio when owner‐occupied housing is included in the list of available assets, namely the risk‐return performance of residential investment, and its usefulness in efficient mixed‐asset portfolios. The risk‐return characteristics of the housing asset is highly dependent on the type of perspective under analysis (household or institutional investor's perspective) and therefore, the two housing investment approaches could lead to different conclusions about the role of housing investment in an portfolio context. The consumption demand for housing together with the markets imperfections place serious constraint on the household's portfolio problem.

The Strategic Management of Open‐ended Property Funds

German open‐ended property fund shows that a strategic management of property investment is indispensable. Suggests that it is possible and fruitful to adapt the instruments for strategic management used by industrial companies to fit the needs of property companies (such as the five‐forces model and the value chain developed by Porter, the strategic portfolio analysis developed by McKinsey, etc.). In the long‐term perspective of institutional investors, dynamic factors such as use, flexibility, productivity and competitive advantages play a much more important role. These thoughts have led to the need to build an operational model for the analysis and “strategic” valuation of property portfolios. This kind of portfolio approach emerges as an effective and flexible instrument for identifying and visualizing strategic development potentials and problem configurations within the assets of open‐ended property funds and other institutional investors.