Performance Of Real Estate Companies Research Articles

DETERMINANTS OF PROFITABILITY OF REAL ESTATE COMPANIES: FGLS APPROACH EMPLOYED

The purpose of this research: The aim of this scientific work is empirically investigate the firm specific and macroeconomic factors that influence the financial performance of real estate companies in the US and UK.Originality / value of the research: The contribution of this empirical work is twofold. First of all, it is the first study where specific and macroeconomic variables are used to determine profitability of the real estate companies in US and UK, after global financial crisis period. Secondly, up to our best knowledge there is no study that employed political stability variable to determine profitability.Methodology: To empirically investigate the relationship between the dependent and independent variables, we conducted regression analysis. To correct for autocorrelation and heteroscedasticity, feasible generalized least square (FGLS) model is employed.Findings: Capital adequacy and capital structure, as well as management efficiency and corporate tax rate, were found to have a strong and significant impact on the financial performance of the real estate companies.

IMPACT OF REVENUE RECOGNITION (PSAK 72) ON THE FINANCIAL PERFORMANCE OF REAL ESTATE

This research aims to apply revenue recognition based on PSAK 72 to the financial performance of real estate companies. The real estate sector is considered one of the sectors significantly affected by the issuance of PSAK 72, which replaced the previous standard, PSAK 44. This research analysis uses qualitative content analysis techniques and non-probability purposive sampling techniques on real estate companies listed on the Indonesia Stock Exchange that meet the criteria. Fifty-six companies become the research sample. The results show that the application of revenue recognition based on PSAK 44 makes the company's financial performance look better when compared to using PSAK 72. The settings in PSAK 72 make income from long-term contracts in companies unable to be recognized in 2020. Therefore, the revenue value in 2020 for each company will be smaller than the revenue recognized under PSAK 44.

The Influence of E-Marketing on Performance of Real Estate Enterprises: Based on Super-Efficiency DEA and Grey Entropy Methods

E-marketing is an important tool for real estate enterprises. We evaluate 3 online marketing channels of 44 Chinese real estate companies. Super-efficiency DEA and grey entropy methods are applied to analyse the influence of E-marketing on the performance of real estate enterprises. We find that E-marketing will affect the business performance of real estate companies. Real estate company managers should adopt more strategies to improve corporate performance.

Value Creation of Real Estate Company Spin-off Property Service Company Listing

Abstract The paper took 12 groups of parent companies and subsidiaries as the samples, in which the property service companies, spun from the real estate companies, have successfully on the capital market. The research showed that the average abnormal return (AAR) of real estate companies’ stocks was positive on the first announcement date of possible spin-off listing, while the cumulative average abnormal return (CAAR) remained positive for 21 days during the (–11, 9) days around the first announcement of possible spin-off and listing. Further, the changes in operating performance of real estate companies and property service companies were analysed after the successful spin-off for 3 consecutive years, compared with the year before the spin-off and listing. The results showed that after the spin-off and listing, real estate companies and property service companies have greatly improved their performance. Therefore, the fact that real estate companies spun off property service companies created positive values for shareholders.

Distance to Headquarter and Real Estate Equity Performance

We study the effect of geographic portfolio diversification of real estate firms on their investment performance before and after the global financial crisis (GFC). In addition to previously used dispersion metrics, we also account for the distance of the properties to the corporate headquarters. We document a notable shift in the non-market performance of real estate companies after the crisis. Pre-GFC, we do not find a difference in non-market performance across equities based on geographic diversification. Post-GFC, equities with high geographic dispersion significantly outperform the market, while firms with concentrated property holdings do not deliver a significant alpha. Increased real estate equity market sophistication and strong institutional presence can explain why this effect is only observed for dispersed small firms, those invested outside gateway metro areas, or companies with low institutional ownership.

The effect of leverage on the performance of real estate companies

PurposeThis paper aims to investigate the impact of leverage on the total shareholder return of European publicly traded real estate vehicles in three periods: Crisis Period (2007-2009), Rebound Period (2009-2014) and the Whole Period.Design/methodology/approachCross-sectional analysis is used and the leverage effect on the performance is controlled for seven other independent variables (local market risk premium, size, book-to-market, short-term debt, cash); moreover, regional differences are accounted for.FindingsIt is established that during the Crisis Period, leverage levels are negatively associated with performance: this relationship also holds throughout the Whole Period, implying that for real estate securities, the cost of financial distress is larger than the potential gain from taxation, although the economic significance of it is limited. The Fama and French (1992) three factors, including size, book-to-market and local market risk premium, are found to be relevant, which is consistent with the literature. In addition, the UK and Sweden regions are identified as significant.Originality/valueEven if there is sizeable body of literature on determinants of leverage and determinants of asset returns, little work has been done on how leverage affects the returns of European real estate companies. In addition, this paper takes advantage of observations from a full economic cycle and the possible effects of the crisis period.

The Impact of Intellectual Capital on Firm Performance of the Turkish Real Estate Companies Before and After the Crisis

Purpose- The main purpose of this study is to find the impact of intellectual capital on firm performance of real estate companies listed in Borsa Istanbul, using data of 27 listed companies over the period 2004-2015. Value Added Intellectual Coefficient (VAIC) method is utilized as a measure of intellectual capital (IC). Methodology- An OLS regression is used to examine the impact of intellectual capital (VAIC); Human capital efficiency (HCE), Structural capital efficiency (SCE), and Capital employed efficiency (CEE) on market, productivity, and financial performance. Findings- The findings show that SCE consider as a key role of value creation in real estate companies where has a positive significant relation with MB, ROE, and EPS before the crisis and with ROA and ROE after the crisis. HCE show a positive significant relation with ROA and ROE before the crisis and a negative significant association with MBand ATO after the crisis. CEE show a negative significant impact on ATO after the crisis. VAIC shows a significant positive impact on ROA, ROE, and EPS before the crisis, while it has the same relation with ROE after the crisis. Conclusion- Although the good result of using intellectual capital for value creation, real estate Turkish companies still weakly depend on its intellectual capital.

The Effect of Relational Capabilities and Managerial Capabilities on Performance Outcome: A Comparison between Architecture Firms and Real Estate Development Companies

Building projects are complex, unique and involve many stakeholders, such as contractors, architects, engineers, investors and developers. Creating and maintaining networks to partners and clients is of crucial importance for a successful project completion and for the competitive advantage of project-based organizations. The aim of this paper is to investigate the role of coordinative capabilities, specifically relational capabilities (RC) and managerial capabilities (MC) for the strategic performance of real estate development companies and architecture firms. It is hypothesized that RC and MC, which are embedded in the organization itself and developed through projects and individual capabilities, influence the strategic performance of architects and real estate developers, and thus lead to competitive advantage and higher firm performance of these companies. The research framework is empirically evaluated by using data from 97 real estate development companies and 79 architecture firms from Austria, Germany, and Switzerland. The hypotheses are tested by applying a stepwise regression analysis. Further on, the findings for these two types of professional service firms are compared and their implication discussed. Our results indicate that under higher environmental uncertainty, relational capabilities are more important for the performance of architecture firms and managerial capabilities are more important for the performance of real estate companies.

The impact of financial crisis on UAE real estate and construction sector: analysis and implications

PurposeThe purpose of this paper is to analyze the performance of real estate and construction companies in the United Arab Emirates (UAE) during the pre (2006‐2007) and post (2008‐2009) global financial crisis periods.Design/methodology/approachA ratio analysis was conducted on a sample of six companies in the real estate and construction sector. A nonparametric test, namely the Wilcoxon matched‐pairs signed rank test, was employed to see whether the calculated ratios differ between the pre‐crisis and post‐crisis periods.FindingsThe findings reveal a negative impact of the business cycle on the performance of real estate companies in the UAE. There is a significant fall in the liquidity, profitability, leverage and activity ratios after the financial crisis.Research limitations/implicationsThe limitations of the study revolve around factors such as limited sample size, non‐availability of data for the aforesaid periods, low transparency in revealing some financial details and non‐availability of yearly industry averages.Practical implicationsThe companies in this sector could be obligated to ensure better transparency in revealing financial information to the public. Implementation of stringent regulatory policies in the real estate sector will help the unprecedented downturn in these companies.Originality/valueThis is the first empirical study conducted to examine the impact of the global financial crisis on the performance of the real estate and construction companies in the UAE.