Dynamics of the Direct and Indirect Real Estate Markets in China
29 Pages Posted: 27 May 2012
Date Written: 2005
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: Suggested Citation