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Factors Affecting Foreign Investor Choice in Types of U.S. Real Estate

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Abstract

Using transaction level data, we present the first analysis of the way that foreign investors choose among different types of United States real estate. Our findings based on the conditional logit model analysis for the 1980-91 period are consistent with the hypothesis that foreign investors behave in a traditional profit maximizing, risk minimizing fashion. In choosing among investments in four major categories (apartment, office, retail and industrial) foreign investor choice is most sensitive to changes in capitalization rates, market activity and current rent levels.

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  • Deborah Ford & Hung-Gay Fung & Daniel A. Gerlowski, 1998. "Factors Affecting Foreign Investor Choice in Types of U.S. Real Estate," Journal of Real Estate Research, American Real Estate Society, vol. 16(1), pages 99-112.
    • Handle: RePEc:jre:issued:v:16:n:1:1998:p:99-112
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    1. D.N. Saxena, 1989. "Foreign Direct Investment," Foreign Trade Review, , vol. 24(1), pages 76-97, April.
    2. Alan J. Ziobrowski & Richard Curcio, 1991. "Diversification Benefits of U.S. Real Estate to Foreign Investors," Journal of Real Estate Research, American Real Estate Society, vol. 6(2), pages 119-142.
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    Cited by:

    1. Hassan Gholipour Fereidouni & Usama Al-mulali & Miswan Abdul Hakim Bin Mohammed, 2013. "The Effects of Transaction Costs, Landlord and Tenant Practices and Property Rights on Foreign Real Estate Investment," Margin: The Journal of Applied Economic Research, National Council of Applied Economic Research, vol. 7(3), pages 351-370, August.
    2. Canfei He & Junsong Wang & Shaoming Cheng, 2011. "What attracts foreign direct investment in China’s real estate development?," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 46(2), pages 267-293, April.
    3. Steven Devaney & David Scofield & Fangchen Zhang, 2019. "Only the Best? Exploring Cross-Border Investor Preferences in US Gateway Cities," The Journal of Real Estate Finance and Economics, Springer, vol. 59(3), pages 490-513, October.

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    JEL classification:

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

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