Dynamics of the Direct and Indirect Real Estate Markets in China

29 Pages Posted: 27 May 2012

See all articles by Graeme Newell

Graeme Newell

Western Sydney University - School of Economics and Finance

K.W. Chau

The University of Hong Kong - Ronald Coase Centre for Property Rights Research - Economics

Siu Kei Wong

University of Hong Kong

Keith McKinnell

affiliation not provided to SSRN

Date Written: 2005

Abstract

The significant economic development of China in recent years has seen a major contribution by both the direct and indirect real estate markets in China to this enhanced international economic status, with potential investment opportunities for international real estate investors in both of these real estate markets.

This study examines the risk-adjusted performance of the direct real estate markets in China (Beijing, Shanghai, Guangzhou, Shenzhen) and the indirect real estate markets in China (real estate companies on the Shanghai and Shenzhen stockmarkets) over 1995-2002, as well as assessing the dynamics between these two important real estate markets in China.

Over this eight-year period, the office markets and real estate companies are seen to significantly under-perform the other asset classes on a risk-adjusted basis; however, evidence of portfolio diversification benefits is also seen for both the office markets and the real estate companies in China.

Keywords: China, funds management, direct real estate, listed real estate companies, risk-adjusted performance analysis, lead-lag relationships

JEL Classification: G12, G14

Suggested Citation

Newell, Graeme and Chau, Kwong Wing and Wong, Siu Kei and McKinnell, Keith, Dynamics of the Direct and Indirect Real Estate Markets in China (2005). Journal of Real Estate Portfolio Management, Vol. 11, No. 3, 2005, Available at SSRN: https://ssrn.com/abstract=2067195

Graeme Newell (Contact Author)

Western Sydney University - School of Economics and Finance ( email )

Locked Bag
Penrith South DC, NSW 1797
Australia

Kwong Wing Chau

The University of Hong Kong - Ronald Coase Centre for Property Rights Research - Economics ( email )

Ronald Coase Centre for Property Rights Research
Pokfulam Road
Hong Kong
Hong Kong
(852)28592128 (Phone)
(852)25599457 (Fax)

Siu Kei Wong

University of Hong Kong ( email )

Pokfulam Road
Hong Kong, HK
China

Keith McKinnell

affiliation not provided to SSRN ( email )

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