We study long-horizon shareholder returns in a comprehensive sample of Real Estate Investment Trust mergers, to test whether or not the anomaly of post-merger underperformance observed in conventional firms applies to the case of REITs. Constructing synthetic benchmark portfolios controlling for...

We study long-horizon shareholder returns in a comprehensive sample of Real Estate Investment Trust mergers. REITs enjoy tax-advantaged status if they conform to net income pay-out requirements. This unique feature results in limitations on management's ability to command free cash flows and to...