The Risk Exposure of Property Cash Flows: Evidence from the Italian Market

17 Pages Posted: 1 Dec 2009 Last revised: 29 Sep 2013

See all articles by Claudio Giannotti

Claudio Giannotti

LUM Jean Monnet university

Gianluca Mattarocci

University of Rome Tor Vergata - Department of Management and Law; University of Rome Tor Vergata - Department of Management and Law

Date Written: November 1, 2009

Abstract

The variability of cash flows of Real Estate investments is affected by specific characteristic of each investment and by the choices for the portfolio composition and for the debt structure. The Italian Real Estate funds could not be evaluated with the same approaches used for other international real estate vehicles because some characteristics are not comparable and so it is necessary to modify them. The aim of the article is to analyse the main characteristics that can define the Real Estate Investment Fund risk. Results demonstrate that the risk is highly influenced by portfolio construction choices respect to the capability of selecting best investment opportunities. The leverage policy must be considered evaluating the variability of expected inflows/outflows and the leverage sustainability.

Keywords: Rating, real estate funds, risk

JEL Classification: G20, L85

Suggested Citation

Giannotti, Claudio and Mattarocci, Gianluca, The Risk Exposure of Property Cash Flows: Evidence from the Italian Market (November 1, 2009). Bancaria No. 10-2009, Available at SSRN: https://ssrn.com/abstract=1514762

Claudio Giannotti (Contact Author)

LUM Jean Monnet university ( email )

Casamassima, BA 70010
Italy

Gianluca Mattarocci

University of Rome Tor Vergata - Department of Management and Law ( email )

Via Columbia n.2
Roma, 00133
Italy
+390672595903 (Phone)
+39062040219 (Fax)

University of Rome Tor Vergata - Department of Management and Law ( email )

Rome
Italy

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