Customer Concentration and Corporate Real Estate Holdings
56 Pages Posted: 5 Nov 2019
Date Written: October 24, 2019
We present new empirical evidence that higher customer concentration leads to lower corporate real estate holdings at the supplier firm level. Further evidence shows that this effect is causal and more pronounced when the likelihood/impact of losing primary customers is higher or when suppliers have less bargaining power. Finally, we show that firms with a concentrated customer base tend to choose capitalized leasing in lieu of holding real estate.
Keywords: Customer Concentration, Corporate Real Estate Holdings, Capitalized Leasing
JEL Classification: G30, G32, R33
Suggested Citation: Suggested Citation