march, 2017
Event Details
Sala de Recepcions, 690 Building Language:
Event Details
Sala de Recepcions, 690 Building
Language: English
This paper studies the impact of real estate prices on the payout policy of firms. Firms use corporate real estate (CRE) assets as collateral to obtain debt. Through this collateral channel, positive shocks to the value of CRE assets allow firms to increase their leverage in order to finance not only investments but also payouts. We find that an increase in the value of CRE assets results in an increase in cash dividends and share repurchases. These effects are stronger in periods of increasing values of CRE, as well as for firms with few investment opportunities and low leverage. We also find that firms that experienced positive shocks to the value of their CRE assets smooth their dividends more.
Organizer
Anil Kumar
Time
(Wednesday) 13:00
Location
Facultat d'Economia i Empresa
Diagonal 690
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