Pandemic Risk Exposure: Impacts of COVID-19 Virus on Real Estate Investments

Abstract

The pandemic caused by the Covid-19 virus has severely impacted the real estate industry. The research investigates the relationship between the spread of the virus and REITs performances in Europe, considering the role played by localization and diversification of properties in the real estate portfolios. The results show that Covid-19 had heterogeneous impacts depending on property types. Moreover, risks associated to Covid-19 may be described by synthetic indexes that represent the degree of vulnerability of economic activities carried out in the real estates.

Note:
Funding Information: The research is financed by the "Hybrid Sustainable Worlds" POR FESR 2014-2020 Veneto Region, Action 1.1.4, Resolution of the Regional Council n. 822 of June 23, 2020 “Call for support for Research and Development projects carried out by regional innovative networks and industrial districts", ID n. 10290827.

Declaration of Interests: The authors declare that they have no known competing financial interests or personal relationships that could have appeared to influence the work reported in this paper.

Keywords: Covid-19, commercial real estates, REITs, vulnerability, abnormal returns

JEL Classification: G1, I10, D80, R10, R30