Asset allocation versus entrepreneurial decisions in real estate investment

Stefan Armonat and Andreas Pfnür

Publications of Darmstadt Technical University, Institute for Business Studies (BWL) from Darmstadt Technical University, Department of Business Administration, Economics and Law, Institute for Business Studies (BWL)

Abstract: (Abstract) Although the application of capital market theory is questionable in real estate investment, many institutional investors still perform asset allocation with historic real estate data. Entrepreneurial investment analysis relies on a different information setting. To date it is unclear which approach, or what data set, offers the most efficient solutions for the use of capital. In order to evaluate policy recommendations for decision making in pension fund real estate investment, we describe an empirical investigation of the investment environment in Germany. We find that current market information restricts the application of capital market models. While the use of investment models and capital market models has been strictly separated, there is no theoretically justified reason for this. Investors have to be aware that they can determine performance parameters for real estate only as approximations. Therefore, it may be fruitful to consider and compare alternative parameter estimates for determining optimal real estate allocations in pension fund investment.

Date: 2003
Note: for complete metadata visit http://tubiblio.ulb.tu-darmstadt.de/35582/
References: View references in EconPapers View complete reference list from CitEc
Citations:

Published in Arbeitspapiere des Arbeitsbereichs Öffentliche Wirtschaft am Fachbereich Wirtschaftswissenschaften der Universität Hamburg, Band Nr. 30 (2003)

Downloads: (external link)
http://www.real-estate.bwl.tu-darmstadt.de/media/b ... asset_allocation.pdf

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:dar:wpaper:35582

Access Statistics for this paper

More papers in Publications of Darmstadt Technical University, Institute for Business Studies (BWL) from Darmstadt Technical University, Department of Business Administration, Economics and Law, Institute for Business Studies (BWL) Contact information at EDIRC.
Bibliographic data for series maintained by Dekanatssekretariat ().