Please use this identifier to cite or link to this item: https://scholarbank.nus.edu.sg/handle/10635/222935
Title: DOES MARKET CONCENTRATION OF INDUSTRIAL REITS IN A LOCALITY AFFECT MARKET RENTS?
Authors: HONG WEI CHENG BRANDON
Keywords: Real Estate
RE
Seah Kiat Ying
2016/2017 RE
Industrial REITs
REIT concentration
Structure-Conduct-Performance Paradigm
Issue Date: 18-May-2017
Citation: HONG WEI CHENG BRANDON (2017-05-18). DOES MARKET CONCENTRATION OF INDUSTRIAL REITS IN A LOCALITY AFFECT MARKET RENTS?. ScholarBank@NUS Repository.
Abstract: The proliferation of REITs in Singapore over the past decade has seen increasing market shares of supply being acquired across REITs. This dissertation seeks to fill the research gap in existing literature pertaining to REITs, which has yet to examine how the concentration of REITs in a locality affects market rents. The study focuses solely on Industrial REITs because of the lack of data from other sectors’ REITs. It uses the percentage of total supply owned by REITs in a locality as a proxy to measure the concentration of REITs in each locality. Based on existing literature on the Structure-Conduct-Performance paradigm in real estate markets, the study hypothesises that the concentration of REITs would have a positive relationship with market rents. The relationship between REIT concentration and market rents for three different factories uses (Single-user, Multiple-user, and Business Park), are analysed on two levels of scale: the regional level, and the district level. On the regional level, the results of this study suggest that there is a statistically significant positive relationship between REIT concentration and Single-user factory rents. On the district level, the results of this study suggest that there is a statistically significant positive relationship between REIT concentration and Single-user factory rents in districts located within the Central and North planning regions, as well as Multiple-user factory rents in districts located within the West planning region. However, it is determined that there are no imminent policy implications arising from the positive relationship between REIT concentration and market rents. This is because REITs do not hold a significant market share of supply in the regions or districts where a positive relationship was found; furthermore, while the results highlight a statistically significant positive relationship between concentration and rents, the coefficients are largely found to be economically insignificant.
URI: https://scholarbank.nus.edu.sg/handle/10635/222935
Appears in Collections:Bachelor's Theses

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