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Commercial Property Exposure and Corporation Financing Choice.

  • Academic Journal
  • Jing Yang1 jyang@fullerton.edu
  • International Journal of Business. 2022, Vol. 27 Issue 2, p1-30. 30p.
  • Article
  • This study explores the possible relationship between a corporation's capital structure and its commercial property exposure as well as property market characteristics. Using data from the heavily levered and rapidly growing U.S. telecommunications industry, we find a positive association between leverage and commercial property exposure via commercial property ownership since the 1996 telecommunications industry deregulation, after controlling for traditional capital structure determinants, and the association is particularly prominent during the 2007-2009 Great Recession. A possible justification is the collateral effect of real estate properties on leverage. The exposure through property leases also play (albeit smaller) roles in the financing choice. Our findings generally suggest a non-trivial influence of real estate exposure to the firms' financing choices, especially when the capital market is tight hence the collateral effect is critical. [ABSTRACT FROM AUTHOR]
Additional Information
capital structure
location effect
real estate exposure
531210 Offices of Real Estate Agents and Brokers
531310 Real estate property managers
522291 Consumer Lending
517910 Other telecommunications
517919 All Other Telecommunications
517911 Telecommunications Resellers
811213 Communication Equipment Repair and Maintenance
Copyright of International Journal of Business is the property of International Journal of Business and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)
1Finance Department, California State University at Fullerton Fullerton, CA 92834, USA
1083-4346
10.55802/ijb.027(2).006
156808235

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