Hotel Real Estate Investment Trusts' Risk Features and Beta Determinants

Hyunjoon Kim, Zheng Gu, Anna S. Mattila

Research output: Contribution to journalArticle

52 Citations (Scopus)

Abstract

This study examines the risk features of hotel real estate investment trust (REIT) firms. In particular, it investigates the systematic and unsystematic risk of hotel REIT stocks and the determinants of their systematic risk, or beta. Using the financial data of 19 U.S. hotel REIT firms from 1993 through 1999, the authors found that 84% of the firms'total risk was contributed by firm-specific, unsystematic risk. Systematic risk correlated positively with debt leverage and growth but negatively with firm size. These findings suggest that growth via mergers and acquisitions and less reliance on debt financing may help lower systematic risk and enhance hotel REITs'value.

Original languageEnglish (US)
Pages (from-to)138-154
Number of pages17
JournalJournal of Hospitality and Tourism Research
Volume26
Issue number2
DOIs
StatePublished - Jan 1 2002

Fingerprint

real estate
determinants
firm
debt
indebtedness
firm size
merger
Hotels
Real estate investment trusts
Systematic risk
acquisition
Values

All Science Journal Classification (ASJC) codes

  • Education
  • Tourism, Leisure and Hospitality Management

Cite this

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Hotel Real Estate Investment Trusts' Risk Features and Beta Determinants. / Kim, Hyunjoon; Gu, Zheng; Mattila, Anna S.

In: Journal of Hospitality and Tourism Research, Vol. 26, No. 2, 01.01.2002, p. 138-154.

Research output: Contribution to journalArticle

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