Analysis of Value Creation in Real Estate

ABSTRACT :Real Estate is a strategic sector in the Spanish economy, that, during the last years, has beensubjected to large fluctuations, including numerous retailer bankruptcies and that, frequently, generate distruston shareholders since they fear that their investments will not be compensated. With the aim of obtainingrelevant information about the capacity of these companies to create value for their shareholders, we haveanalyzed Real Estate companies that are listed in the Spanish stock market. The financial data has beenprocessed and the necessary variables have been calculated in order to make an exhaustive analysis of valuecreation for these companies, following the main theories of the ad hoc literature. The results obtained point toconstruction companies and civil engineering companies that achieve the creation of value for theirshareholders, and that, therefore, are among the most capable of facing potential trust crisis from shareholders,in the face of instability situations in the financial markets.

Keywords:CAPM, Real Estate, ROA, ROE, Value Creation