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Active Management in Real Estate Mutual Funds
Journal article   Peer reviewed

Active Management in Real Estate Mutual Funds

Viktoriya Lantushenko and Edward Nelling
The journal of real estate finance and economics, v 61(2), pp 247-274
01 Aug 2020
DOI: https://doi.org/10.1007/s11146-019-09722-y
Featured in Collection :   UN Sustainable Development Goals @ Drexel

Abstract

Business & Economics Business, Finance Economics Social Sciences Urban Studies
This paper examines active management in real estate mutual funds (REMFs). The REMF industry has expanded as the underlying REIT industry has developed over time, but the number of REMFs experienced a sharp decline following the global financial crisis. The likelihood of termination is greater for smaller funds and funds with higher expense ratios. Using various measures of active management (Fund R-2, Active Share, Property-Type Concentration Index, and Return Gap), we observe that real estate fund managers have become less active over time. In contrast to the findings for more broadly diversified equity funds, these activeness measures do not explain the future performance of REMFs. To the extent that geographic diversification measures activeness, we find no evidence that the performance of REMFs holding geographically diversified portfolios differs from the performance of REMFs with concentrated portfolios. Overall, our findings shed light on the uniqueness of REMFs relative to diversified equity mutual funds.

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17 Record Views
3 citations in Web of Science
8 citations in Scopus

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UN Sustainable Development Goals (SDGs)

This publication has contributed to the advancement of the following goals:

#8 Decent Work and Economic Growth

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Collaboration types
Domestic collaboration
Web of Science research areas
Business, Finance
Economics
Urban Studies
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