PEM Seminar Series - Commercial Real Estate Market Structure and Transaction Liquidity — A Social Network Analysis
|Dates:||6 November 2019|
|Times:||13:00 - 14:00|
|What is it:||Seminar|
|Organiser:||Manchester Urban Institute|
|Speaker:||Dr Melanie Fangchen Zhang|
The study analyses the market network structure evolution of the selected commercial real estate (CRE) markets in the United Kingdom. While previous studies discuss investors’ behaviours at an aggregate level but assuming investors make decisions independently, this paper investigates the transaction counterparties and their transaction networks. This study uses Social Network Analysis (SNA) to investigate the role changes of foreign investors, the evolution of transaction network structure, and the influences of the changes to market liquidity. Results from selected metro markets in 2001-2015 show that, the increasing number of foreign investors provide excess market demands but have not effectively improved the asset circulation. Only a certain number of foreign investors act as “core investors” and release the liquidity in the market. The UK CRE market structure reflects an integrating process with some core investors linking the transaction networks. VECM model results suggest that it will hamper the pricing efficiency if a market has a strong degree-assortative structure i.e. large investor tend to link with other large counterparties but not small ones. Stronger links with same-country counterparties improve pricing efficiency. The findings provide a new vision on analysing the influences of overseas investors, market liquidity and stability.
Dr Melanie Fangchen Zhang
Organisation: Northumbria University
Biography: Fangchen (Melanie) Zhang is an associate lecturer in the School of Architecture and Built Environment, Northumbria University. She is currently completing her PhD degree in Real Estate and Planning, University of Reading. Melanie’s research interests specialise in real estate investment, corporate strategic management, and real estate market structure. She has also been collaborating her interests in commercial real estate with local productivity and urban economics. Her research outputs have been presented in several conferences in real estate and urban economics. Melanie has dedicated teaching in University of Reading, University of Wolverhampton, London School of Economics and Political Science and Northumbria University. The teaching topics include real estate finance, investment appraisal, urban economics and corporate real estate management.
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