Study on the timing of investment decision of real estate projects based on the real option theory

DOI

10.2991/lemcs-14.2014.95How to use a DOI?

Keywords

real options;timing of investment decisions;real estate projects

Abstract

Real estate investment project has the real option characteristics such as long time development, high capital and high investment risk. Contrasting with the traditional evaluation method, the real option theory is more scientific one that considers the value of the management flexibility and strategic investment. Considering the management flexibility, the timing of investment can improve the value of the project. This paper builds the optimal investment timing model to explain why the developers will delay the investment. The factors affecting the optimal investment time are discussed through the sensitivity analysis.

Copyright

© 2014, the Authors. Published by Atlantis Press.

Open Access

This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

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TY  - CONF
AU  - Yang Yang
AU  - Huashan Tan
PY  - 2014/05
DA  - 2014/05
TI  - Study on the timing of investment decision of real estate projects based on the real option theory
BT  - Proceedings of the International Conference on Logistics, Engineering, Management and Computer Science
PB  - Atlantis Press
SP  - 410
EP  - 413
SN  - 1951-6851
UR  - https://doi.org/10.2991/lemcs-14.2014.95
DO  - 10.2991/lemcs-14.2014.95
ID  - Yang2014/05
ER  -