The increasing development all over the world gives the real estate industry an opportunity to thrive which includes the REITs sector. Since the establishment of J-REITs in 2001, it has been growing rapidly across Asia. The IMF report showed that Asia continues to be the main growth engine of the world and is projected to grow in years to come. However, investors still remain cautious when dealing with Asian REITs because the markets are not established yet. Previous studies have proved that Asian REITs is able to show competitive advantage in most of mixed-asset scenarios and have significant roles in improving efficient global REITs portfolio returns. Since real estate is an essential part of the economy, its returns are related to the macroeconomic factors such as inflation and GDP. Excess return is used to measure the risk-adjusted performance by measuring how much risk from the macroeconomic factors is involved in producing that return. Hence, the aim of this paper is to evaluate the macroeconomic factors impact on the excess returns of Asian REITs. The data are retrieved from previous researches. The macroeconomic factors that impacted the returns are long term interest rates, short term interest rates, inflation, gross domestic product, construction index, industrial production, money supply, exchange rates and consumption risk. The excess return is found to be a good performance measurement in order for the investors to evaluate the expected returns before making an investment decision.
Asian REITs could be considered as one of the fastest growing assets in the world. Japan is currently the biggest market in Asia and Asian REITs market is very much progressing to expand with the emerging of two major regional economies, China and India. Previous studies have proved that Asian REITs are able to show competitive advantage in most of mixed-asset scenarios and have significant roles in improving efficient global REITs portfolio returns. Previous findings also have shown that REITs are able to give remarkable return compare to other asset classes. Similar with other type of portfolio investment, REITs also have high interaction with macroeconomic factors such as inflation and interest rate which represent the economic situation of the countries. The excessive return is used to measure the performance that is affected by the macroeconomic factors by setting a benchmark which will give an added value to the portfolio. Hence, the aim of this research is to review on the literature of the macroeconomic factors on excessive returns Asian REITs.
scite is a Brooklyn-based organization that helps researchers better discover and understand research articles through Smart Citations–citations that display the context of the citation and describe whether the article provides supporting or contrasting evidence. scite is used by students and researchers from around the world and is funded in part by the National Science Foundation and the National Institute on Drug Abuse of the National Institutes of Health.
customersupport@researchsolutions.com
10624 S. Eastern Ave., Ste. A-614
Henderson, NV 89052, USA
Copyright © 2024 scite LLC. All rights reserved.
Made with 💙 for researchers
Part of the Research Solutions Family.