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Schedule

Tuesday, June 4
11:00am Real Estate Research Conference Opens
11:05am - 12:20pm Introductory Session: The Role of Research in Support of REIT Investment and Management 

Research Presentation: 
Can Securitization Work? Lessons from the U.S. REIT Market, presented by Timothy Riddiough, E.J. Plesko Chair in the Department of Real Estate and Urban Economics, University of Wisconsin School of Business 

The authors ask whether the REIT model of real estate securitization provides any measurable economic “goods” to society. While the housing market went through a severe decline caused in part by excess housing supply, balanced supply caused the commercial property market to experience a more muted downturn. The authors conjecture that an important contributing factor to the muted commercial property supply response was the “civilizing influence” of the REIT sector. Their empirical findings suggest that the REIT market indeed moderated supply outcomes in the U.S. 

Moderator:
Mike Grupe, EVP-Research & Investor Outreach, NAREIT 

Panelits:
Debra Cafaro, Chairman & CEO, Ventas 
Mike Kirby, Chairman & Director of Research, Green Street Advisors 
Joseph L. Pagliari, Jr., Clinical Professor of Real Estate, Booth School of Business, University of Chicago
Keith Pauley, Managing Director & CIO, LaSalle Investment Management
Timothy Riddiough, E.J. Plesko Chair in the Department of Real Estate and Urban Economics, University of Wisconsin School of Business
12:30pm - 2:00pm Luncheon Session

Presentation of "Distinguished Research Prize"

Guest Luncheon Speaker:
Robert Gordon, Stanley G. Harris Professor in the Social Sciences, Northwestern University
2:15pm - 3:30pm Research Panel Discussion I*: Commercial Real Estate Returns in Public and Private Markets

Research Presentation: 
Returns, Volatility, and Information Transmission Dynamics in Public and Private Real Estate Markets, presented by David Ling, McGurn Professor in the Department of Finance, Insurance and Real Estate, Hough Graduate School of Business, University of Florida 

The authors examine public and private real estate returns and volatility in aggregate and by four property types over the period 1994:Q2 – 2010:Q4. Their results, after adjusting for differences in financial leverage, property type focus and management fees, suggest that portfolios of U.S. office, industrial and retail REITs outperformed their private market benchmarks; only in the multifamily market did they find some evidence of higher returns in the private market. In aggregate, unlevered core REITs outperformed their private market benchmarks by 46 basis points per year over the sample period. 

Research Presentation: 
REIT and Commercial Real Estate Returns: A Post Mortem of the Financial Crisis, presented by Sheridan Titman, Professor of Finance, McCombs School of Business, University of Texas at Austin 

The authors examine the cross-sectional dispersion of REIT returns during the financial crisis, using the debt ratio and debt maturity structure to separate the influence purely of leverage from the effect of financial distress. They find that the share prices of REITs with higher debt-to-asset ratios and shorter maturity debt fell more during the crisis period from 2007 to early 2009, consistent with the hypothesis that both leverage and financial distress amplified stock price declines. Although REIT share prices rebounded with the recovery in commercial property values, financial distress costs had a permanent effect on REIT values. 

Moderator:
Brad Case, SVP-Research & Industry Information, NAREIT 

Panelits:
Merrie Frankel, Sr. Credit Officer & VP, Moody’s Investor Service 
Michael Hudgins, Executive Director-Global REIT Strategist, J.P. Morgan Asset Management 
David Ling, McGurn Professor, Department of Finance, Insurance & Real Estate, Hough Graduate School of Business, University of Florida 
Andrew McCulloch, Managing Director, Green Street Advisors 
Sheridan Titman, Professor-Finance, McCombs School of Business, University of Texas at Austin
3:45pm - 5:00pm Research Panel Discussion II*: Geographic Diversification in Global REIT Portfolios and U.S. REIT Holdings

Research Presentation: 
Macroeconomic Risk Factors in the Returns from International Real Estate Securities, presented by Eva Steiner, Department of Land Economy, University of Cambridge and Susan M. Wachter, Worley Professor of Financial Management and Professor of Real Estate Finance, Wharton Real Estate Department, University of Pennsylvania 

While the benefits of diversification from global real estate securities are well established, the drivers of global listed property company returns are insufficiently understood. The authors hypothesize that an indicator of mispriced credit is significant in explaining time variation of returns, and test their hypothesis using data from a large sample of firms from 20 countries over the period 1999-2011. The authors find support for the predictions of three major international asset pricing models – focusing on a global market factor, inflation, and foreign exchange rate risk – as well as for their hypothesized link between local credit conditions and returns. 

Research Presentation: 
Sources of Risk Spillovers among U.S. REITs: Asset Similarities and Regional Proximity, presented by Zeno Adams, Post-Doctoral Research Fellow, Swiss Institute of Banking and Finance, University of St. Gallen 

The authors examine risk spillovers among 74 U.S. REITs using a methodology that enables them to quantify spillover size as a function of each company’s financial condition (tranquil, normal, volatile). They find evidence for the impact of geographic proximity: REITs whose properties are located close to those of other REITs show significantly greater risk spillovers than REITs that have similar properties but at greater distances, and risk spillover disappears at distances greater than 250 miles. Their results highlight the role of geographic diversification for REITs and have implications for investment and risk management decisions of real estate investors, mortgage lenders, and others. 

Moderator:
Calvin Schnure, VP-Research & Industry Information, NAREIT 

Panelits:
Zeno Adams, Post-Doctoral Research Fellow, Swiss Institute of Banking and Finance, University of St. Gallen 
Jacques Gordon, Head of Research and Strategy – Global, LaSalle Investment Management 
Sherry Rexroad, CIO, Global REITs, BlackRock 
Susan M. Wachter, Worley Professor of Financial Management and Professor of Real Estate Finance, Wharton Real Estate Department, University of Pennsylvania 
5:00pm Program Concludes
 
*Each research panel will introduce one or two papers with a 20 minute presentation. The papers will be followed by a general discussion with REIT executives, investors and analysts, plus audience Q&A.