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Rationales for Real Estate Leasing versus Owning

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Abstract

In this article, rationales for the widespread existence of commercial real estate leasing are examined. Given the tendency of tenants to abuse property to their own advantage, there must be powerful incentives on the other side to encourage landlords and property managers to participate in the widespread practice of leasing. We suggest that common leasing practices are the consequence of many rationales, including the ability of the landlord to solve free-rider problems in maintaining property desirability and informational asymmetries that exist between landlords and tenants.

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  • John Benjamin & Chris de la Torre & Jim Musumeci, 1998. "Rationales for Real Estate Leasing versus Owning," Journal of Real Estate Research, American Real Estate Society, vol. 15(3), pages 223-238.
    • Handle: RePEc:jre:issued:v:15:n:3:1998:p:223-238
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    Cited by:

    1. Noriko Ashiya, 2015. "Determinants of Potential Seller/Lessee Benefits in Sale¡VLeaseback Transactions," International Real Estate Review, Global Social Science Institute, vol. 18(1), pages 89-112.
    2. Arnold, Lutz G. & Babl, Andreas, 2014. "Alas, my home is my castle: On the cost of house ownership as a screening device," Journal of Urban Economics, Elsevier, vol. 81(C), pages 57-64.

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    JEL classification:

    • L85 - Industrial Organization - - Industry Studies: Services - - - Real Estate Services

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