An Evaluation of Property Company Discounts in Europe

Shilling James

ERES from European Real Estate Society (ERES)

Abstract: Discounts in the market price of a company (or fund) holding an asset to the book value of the underlying asset have been extensively studied in equity markets. Explanations such as accumulated capitalgain liabilities, management costs and institutional characteristics have been suggested as reasons for the observed discounts. However there has been little research on this phenomenon in real estate markets, despite a belief that such discounts are pervasive. Using data collected by Merrill Lynch and EPRA it is possible to investigate how discounts to net asset values vary cross-sectionally by using the approach of Shin and Stulz (2000). To do this we measure growth opportunities by identifying the total volatility and the systematic (beta) risk of a firm. We then use cross section regression techniques to study the relationship between the firmÌs discount to NAV and the risk measures across European markets.

JEL-codes: R3 (search for similar items in EconPapers)
Date: 2003-06-01
References: Add references at CitEc
Citations:

Downloads: (external link)
https://eres.architexturez.net/doc/oai-eres-id-eres2003-121 (text/html)

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:arz:wpaper:eres2003_121

Access Statistics for this paper

More papers in ERES from European Real Estate Society (ERES) Contact information at EDIRC.
Bibliographic data for series maintained by Architexturez Imprints ().