Digital library of construction informatics and information technology in civil engineering and construction
 
ITC
Digital library
SciX
Tower of Babel
Home All papers Browse by series Browse by authors Browse by keywords Browse by years
Paper: eres2012_278
Paper title: Using clustering methods for a practicable real estate portfolio allocation process
Authors: Kristin Wellner
Summary: By moving asset allocation models from the scientific theory to the investment reality, institutional real estate investors are confronted with a number of practical problems. Starting with a diversified international real estate portfolio by using the portfolio theory, this research paper shows a pragmatic approach to transform the calculated results into a real allocation process for finding a practical target portfolio for direct investments. However, the literature of the last 20 years shows a high level of diversification effects by using the portfolio theory also for real estate portfolios. But there is still a dilemma to transform these results into a daily allocation process. The new transformation process “as a result of this paper” is using clustering methods and different return calculations, offering more possibilities for choosing the suitable components for an existing real estate portfolio. With a top down to bottom up procedure according to a counter-current principle, it is possible to find properties which are suitable in practice. The paper gives an outlook on the practicable application of the results using the Markowitz theory in consideration of the uncertain and imperfect real estate markets. In practical consideration, there are still problems regarding the properties of direct real estate investments and their markets, for example the characteristics of properties, real estate market situations and sizes. On the basis of empirical statistical tests based on real estate total return indices, this paper aims to find a solution to overcome these difficulties.
Type: normal paper
Year of publication: 2012
Series: ERES:conference
Download paper: /pdfs/eres2012_278.content.ppt
Citation: Kristin Wellner (2012). Using clustering methods for a practicable real estate portfolio allocation process. 19th Annual European Real Estate Society Conference in Edinburgh, Scotland, http://itc.scix.net/paper/eres2012_278
hosted by University of Ljubljana University of Ljubljana

includes:

CIB
W78

ECCE

ITcon
© itc.scix.net
inspired by SciX, ported by Robert Klinc [2019]