Corporate Real Estate Holdings: Fool' s Gold or Crown Jewel?

Takanori Fukushima, Nobuyuki Isagawa, Tomohiro Mae, Satoru Yamaguchi and Takashi Yamasaki
Additional contact information
Takanori Fukushima: Mizuho Securities, Strategic Solutions Department
Nobuyuki Isagawa: Graduate School of Business Administration, Kobe University
Tomohiro Mae: Sumitomo Mitsui Trust Bank, Alternative Assets Investment Department
Satoru Yamaguchi: Hiroshima University of Economics
Takashi Yamasaki: Graduate School of Business Administration, Kobe University

No 2013-03, Discussion Papers from Kobe University, Graduate School of Business Administration

Abstract: This paper aims to introduce new evidence of consistently negative impacts on enterprise value when corporations increase real estate holdings. Adopting a different approach from previous studies, our data analysis shows that corporate real estate portfolios and enterprise value share an inverse relationship. Surprisingly, this trend was seen during the Japanese real estate bubble in the late 1980' s. Previous reports from the United States and Singapore show that only in the retail sector do increases in corporate real estate holdings have a positive influence on stock performance. However, our research indicates that the stock performance of Japanese firms in the retail sector was negative across the board for firms in other sectors.

Keywords: Corporate real estate; Stock performance; Systematic risk; Stock market (search for similar items in EconPapers)
Pages: 24 pages
Date: 2013-01
New Economics Papers: this item is included in nep-sea and nep-ure
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