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...

In this paper, we examine the relationship between managerial stock option holdings and the decision to announce a repurchase of the firm's common stock. Managerial stock option holdings should reinforce the traditional undervaluation, free cash flow and capital structure motives for...

Loan-to-value ratio and debt service coverage ratios have long been viewed as the two important quantitative measures of the default risk of commercial mortgages. Option-based models of default provide strong theoretic support for the importance of original loan-to-value ratio. The same...

In this paper we develop a theoretical framework for determining whether laws designed to reduce lead paint risk are consistent with efficiency. We do this in the context of both owner-occupied and rental housing, and under different informational scenarios depending on who has knowledge about...

We analyze director compensation for Real Estate Investment Trusts (REITs) and investigate the relations between director compensation and other measures of the board independence and board monitoring. Using 136 REITs in 2001, we find that REITs that pay higher equity-based compensation to their...

This paper provides a new model to explain local variation in apartment rents by introducing the notion of a spatial process. This model differs from those in the literature by explicitly specifying spatial association between pairs of locations as a function of distance between them. Data on...

Much of the literature on capital structure excludes Real Estate Investment Trusts (REITs) due mainly to the unique regulatory environment of these firms. As such, the issue of how REITs choose among different financing options when they raise external capital is largely unexplored. In this...

This study investigates the long-horizon performance of open-market stock repurchases for REITs. We develop a new methodology to model the autocorrelation of monthly returns into long-horizon buy-and-hold abnormal return estimators. Serial correlation can introduce bias (autocorrelation bias)...

We examine major sales of real property by public U.S. Real Estate Investment Trusts (REITs) 1992-2002. We find that abnormal shareholder returns are significantly positive, a result that is consistent with findings for conventional firms that sell off real estate. Because REITs do not pay...

Conflict of interest between shareholders (principal) and managers (agent) is a potential weakness of the modern corporate form. Various monitoring mechanisms - pay for performance compensation schemes, mix of cash compensation and long term compensation, the independence of the board of...