{"title":"Determinants of REIT Credit Ratings","authors":"C. Dodd, M. Hill","doi":"10.1080/10835547.2018.12090017","DOIUrl":null,"url":null,"abstract":"Executive Summary This study examines the determinants of credit ratings for real estate investment trusts (REITs). Probit and ordered probit results generally suggest reduced ratings (S&P and Fitch) for REITs with greater financial constraints. Higher rated REITs are larger with greater dividends, lower cash holdings, and less volatile dividends. The significance of leverage is conditional on econometric methodology and operating performance measure. Unlike for Fitch, operating performance influences S&P's rating assignments through earnings and not FFO. The latter challenges the credibility of S&P in the effective monitoring of REITs and highlights differences in financial characteristics accounted for by rating agencies.","PeriodicalId":35895,"journal":{"name":"Journal of Real Estate Portfolio Management","volume":null,"pages":null},"PeriodicalIF":0.0000,"publicationDate":"2018-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"2","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"Journal of Real Estate Portfolio Management","FirstCategoryId":"1085","ListUrlMain":"https://doi.org/10.1080/10835547.2018.12090017","RegionNum":0,"RegionCategory":null,"ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q2","JCRName":"Economics, Econometrics and Finance","Score":null,"Total":0}
引用次数: 2
Abstract
Executive Summary This study examines the determinants of credit ratings for real estate investment trusts (REITs). Probit and ordered probit results generally suggest reduced ratings (S&P and Fitch) for REITs with greater financial constraints. Higher rated REITs are larger with greater dividends, lower cash holdings, and less volatile dividends. The significance of leverage is conditional on econometric methodology and operating performance measure. Unlike for Fitch, operating performance influences S&P's rating assignments through earnings and not FFO. The latter challenges the credibility of S&P in the effective monitoring of REITs and highlights differences in financial characteristics accounted for by rating agencies.
期刊介绍：
The Journal of Real Estate Portfolio Management (JREPM) is a publication of the American Real Estate Society (ARES). Its purpose is to disseminate applied research on real estate investment and portfolio management.
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