The real estate risk of hospitality firms: Examining stock-return sensitivity to property values

Lee, Seul Ki; Jang, SooCheong

doi:10.1016/j.ijhm.2011.09.005

Cited by 22 publications

(15 citation statements)

References 54 publications

(61 reference statements)

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“…Energy betas are estimated for each firm-year, equalling the number of firmyear observations in Table 1. Estimation is done by least squares, consistent with recent approaches (Bartram and Bodnar, 2007;Lee and Jang, 2012). The fivefactor model yields energy betas after other risk factors are 'partialled out'.…”

Section: Methodsmentioning

confidence: 99%

Research Note: US Lodging Firms' Exposure to Energy Price Risk

Lee

Jang

2015

Tourism Economics

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To date, studies on hotel energy use have examined the implications in terms of direct cost savings, environmental sustainability and corporate social responsibility. However, as the profitability of lodging firms is subject to changes in energy prices, their value may depend on exposure to energy price volatility. This paper examines the exposure of US lodging firms to energy price risk between 2001 and 2014. The authors find that energy price considerably affected stock returns of lodging firms throughout the sample period, and conclude that participation in an energy saving programme reduces the lodging firm's stock return exposure to energy price risk, thereby enhancing firm value.

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Section: Methodsmentioning

confidence: 99%

Research Note: US Lodging Firms' Exposure to Energy Price Risk

Lee

Jang

2015

Tourism Economics

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“…Literature shows that those that do not directly own real estate assets but manage assets owned by specialised investors (REITs) normally outperform in the market given the higher average income level and the lower variability of returns. The evidence is normally justified by the opportunity for hotel companies that rent the real estate assets to focus on their core business without the risks and costs related to the real estate asset ownership and the fact that they can minimise their financial needs as well as their cost of capital (Lee and Jang, 2012).…”

Section: Literature Reviewmentioning

confidence: 99%

Real estate funds specialized in the Italian hotel industry: a case study analysis

Bindo¹,

Mattarocci²,

Roberti³

2019

26th Annual European Real Estate Society Conference

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Real estate industry is looking for new asset classes characterised by a different risk-return profile with respect to standard classes (offices, retail, residential, etc…) and the hotel industry represents a new asset class where the real estate funds are looking for new investment opportunities. The performance analysis of the hotel industry shows that hospitality assets perform differently than other real estate asset classes and significant differences are detected based on the location and the quality standard of the hotel structure. The performance in the hotel industry is significantly affected by the hotel reputation and its capability to maximize the RevPAR (through the optimization of the ADR and Occupancy rate) of the hospitality infrastructure. The performance drivers of this asset class are not comparable to other types of real estate, as the skills and information needed to evaluate the investment opportunities in the hospitality industry are unique and not frequently available for fund managers operating in other real estate segments. Literature on the diversification strategies in the hotel industry is still limited and there is scarce evidence outside the US about the performance of real estate portfolios specialised in the hotel industry. This paper analyses the Italian industry and provides evidence on the performance achieved by the opportunities related to the hotel industry by considering the case study methodology. The results highlight that the performance of the hotel industry is different than other real estate asset classes and the portfolio composition criteria normally adopted for specialised real estate funds are unique and focused prevalently on the revenues forecast and the rent sustainability.

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“…In support of research conducted by Lee and Jang (2012), Chen and Lin (2013) examined Taiwan's lodging industry and subsequently confirmed that uncertainty of market demand within the hospitality sector was one of the leading causes of hotel overdevelopment.…”

Section: Practical Implications Of Overcapacity and Undercapacitymentioning

confidence: 89%

“…The overdevelopment of lodging capacity can be inadvertently caused by concerns over the scenario of increased competition, especially if there is a rise in the number of new incoming lodging properties, which in turn can result in a drop in occupancy rates and losses in market share and profitability (Chon & Sing, 1993). Furthermore, Lee and Jang (2012) found that the overdevelopment of the US lodging industry was due in part to uncertainties in market demand. Their study pointed out that the consequences of underdevelopment tended to impose a higher level of adverse impact on stakeholders located within the hospitality industry than did the scenario of overdevelopment (Lee & Jang, 2012).…”

Section: Practical Implications Of Overcapacity and Undercapacitymentioning

confidence: 99%

“…Furthermore, Lee and Jang (2012) found that the overdevelopment of the US lodging industry was due in part to uncertainties in market demand. Their study pointed out that the consequences of underdevelopment tended to impose a higher level of adverse impact on stakeholders located within the hospitality industry than did the scenario of overdevelopment (Lee & Jang, 2012).…”

Section: Practical Implications Of Overcapacity and Undercapacitymentioning

confidence: 99%

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The economic and social impact of the gaming industry during economic downturns

Marlowe

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The real estate risk of hospitality firms: Examining stock-return sensitivity to property values

Cited by 22 publications

References 54 publications

Research Note: US Lodging Firms' Exposure to Energy Price Risk

Research Note: US Lodging Firms' Exposure to Energy Price Risk

Real estate funds specialized in the Italian hotel industry: a case study analysis

The economic and social impact of the gaming industry during economic downturns

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