TY - JOUR
T1 - Real Estate Investment Trusts (REITS)
T2 - A new business model in the FTSE100
AU - Haslam, Colin
AU - Tsitsianis, Nicholas
AU - Andersson, Tord
AU - Gleadle, Pauline
N1 - CC-BY-NC-ND
PY - 2015/12
Y1 - 2015/12
N2 - This paper is about the Real Estate Investment Trust (REIT) business model. REITs benefit from tax concessions and Fair Value Accounting (FVA) practices. REITs distributing over 90 percent of profits can obtain tax concessions for their shareholders. This encourages profit distribution at the expense of accumulating retained earnings in shareholder equity. The financial viability of REITs depends upon FVA because this records holding gains when property values are increased. These holding gains can be employed to generate additional financial leverage. However, REITs are exposed to property market volatility and this can quickly undermine solvency, credit ratings and financial stability.
AB - This paper is about the Real Estate Investment Trust (REIT) business model. REITs benefit from tax concessions and Fair Value Accounting (FVA) practices. REITs distributing over 90 percent of profits can obtain tax concessions for their shareholders. This encourages profit distribution at the expense of accumulating retained earnings in shareholder equity. The financial viability of REITs depends upon FVA because this records holding gains when property values are increased. These holding gains can be employed to generate additional financial leverage. However, REITs are exposed to property market volatility and this can quickly undermine solvency, credit ratings and financial stability.
U2 - 10.1016/j.accfor.2015.10.003
DO - 10.1016/j.accfor.2015.10.003
M3 - Article
SN - 0155-9982
VL - 39
SP - 239
EP - 248
JO - Accounting Forum
JF - Accounting Forum
IS - 4
ER -