Sale and leaseback, asset outsourcing and capital market impacts

Journal of Corporate Real Estate

Volumn 6, Issue 2, 2004, Pages 118-132

  Devaney, Steven ^a   Lizieri, Colin ^b  

^a UNIVERSITY OF READING   (United Kingdom)

^b UNIVERSITY OF READING   (United Kingdom)

Author keywords

Capital markets; Event study; Outsourcing; Sale and leaseback

Indexed keywords

EID: 84992974157     PISSN: 1463001X     EISSN: 14791048     Source Type: Journal    
DOI: 10.1108/14630010410812298     Document Type: Article

References (9)

1. For reviews see Rodriguez, M. and Sirmans, C. (1996) ‘Managing Corporate Real Estate: Evidence from the Capital Markets’, Journal of Real Estate Literature, Vol. 4, pp. 13-33; Lizieri, C., Ward, C. and Lee, S. (2001) ‘Financial Innovation in Property Markets: Implications for the City of London’, Final Report: Corporation of London. A discussion of European corporate outsourcing can be found in Nappi-Choulet, I. (2002) ‘Corporate Property Outsourcing in Europe: Present Trends and a New Approach for Real Estate Economics’, paper presented to the IPD European Property Strategies Conference, Wiesbaden, May 2002.
2. This differs from practice in the USA, where, under US GAAP, the properties must remain on the balance sheet and a corresponding liability be raised against them.
3. Beattie, V., Goodacre, A. and Thomson, S. (2000) ‘Recognition versus Disclosure: An Investigation of the Impact on Equity Risk Using UK Operating Lease Disclosures’, Journal of Business Finance & Accounting, Vol. 27, Nos 9-10, November-December, pp. 1185-1224.
4. See for example Moody's Investors Service (2001) ‘European Telecommunications Operators’ Use of Sale and Leaseback Transactions Can Pressure Ratings’, Special Comment, October 2001, Report 70915, London.
5. See Hill, M. (2001) ‘Corporate Real Estate: Its Role in Maximising Shareholder Value’, Journal of Corporate Real Estate, Vol. 3, No. 4, pp. 335-345.
6. Gibson, V. and Barkham, R. (2001) ‘Corporate Real Estate Management in the Retail Sector: A Study of the Relationship between the Management of the Corporate Real Estate and Corporate Performance’, Journal of Real Estate Research, Vol. 22, Nos 1-2, pp. 107-127.
7. The author suspect that many such decisions are based on somewhat uncertain or speculative figures. Further, many of the outsourcing deals examined have been motivated more by capital than by revenue impacts.
8. The Abbey National deal has been featured in more detail in a previous issue of the Journal of Corporate Real Estate: see Asson, T. (2002) ‘Real Estate Partnerships: A New Approach to Corporate Real Estate Outsourcing’, Journal of Corporate Real Estate, Vol. 4, No. 4, pp. 327-333.
9. Adams, A. and Clarke, R. (1996) ‘Stock Market Reactions to Sale and Leaseback Announcements in the UK’, Journal of Real Estate Research, Vol. 13, pp. 31-46.