FINANCING THROUGH THE SYSTEM OF SECURITIZATION, TARGETING CORPORATE REAL ESTATE: THEORETICAL FINDINGS BEST FIT FOR EURO-ZONE ECONOMIES

Noriko Ashiya

ERES from European Real Estate Society (ERES)

Abstract: This paper has two objectives: (1) to formulate a theory of financing through the system of real estate securitization as one option among various kinds of corporate real estate strategies for representative firms aiming for profit expansion; and (2) to show that the nominal interest rate as well as the rate of capital depletion would help sustain money circulation between the firm and the investors who bought the released securities. This posited result implies the importance of the role of these two factors ñ nominal interest rate and the rate of capital depletion ñ as key determinants of the robustness of such a securitization system. Note that this paper presents an analytical framework as simply as possible, so that it can present an accurate and plausible conclusion to clearly show which factor would be essential in the construction of long lasting, default-free, scheme of real estate securitization. It also examines the ramifications of the findings in a systematic manner.

JEL-codes: R3 (search for similar items in EconPapers)
Date: 2010-01-01
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Persistent link: https://EconPapers.repec.org/RePEc:arz:wpaper:eres2010_013

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