REDEVELOPMENT OF REAL ASSETS

Authors
Citation
Jt. Williams, REDEVELOPMENT OF REAL ASSETS, Real estate economics, 25(3), 1997, pp. 387-407
Citations number
12
Categorie Soggetti
Business Finance",Economics
Journal title
ISSN journal
10808620
Volume
25
Issue
3
Year of publication
1997
Pages
387 - 407
Database
ISI
SICI code
1080-8620(1997)25:3<387:RORA>2.0.ZU;2-H
Abstract
Real assets can be redeveloped repeatedly. Unlike financial assets, th e option to redevelop real assets can be exercised infinitely often. F or a depreciating real asset, the optimal exercise policy and resultin g market values are calculated analytically and compared to the standa rd solution with at most one redevelopment. Relative to the standard s olution, redevelopment is on average more frequent and less extensive, and the resulting market values are greater.