Stephen Miller (Economics; Center for Business and Economic Research) had his paper, "Does Debt  Management Matter for  REIT Returns?", with co-authors Zhilan Feng, Clarkson University, and Dogan Tirtiroglu, Ryerson University appear as the lead article in the Journal of Real Estate Finance and Economics, January 2025.

Asset and debt management are two essential managerial tasks in any firm. The traditional view holds that asset management primarily drives real estate investment trust (REIT) returns because: (1) interest tax shields are not a source of incremental value for REITs and (2) the plain tangibility of real estate assets helps to diminish the financial distress costs of REITs. This paper examines empirically whether debt management also matters for the operating returns (i.e., ROA, ROE, ΔROA or ΔROE) of a portfolio of REITs. Applying a novel dynamic decomposition method to ΔROA or ΔROE and defining ROA and ROE under the net income and funds from operations metrics guide our empirical approach. Our findings show that the effects of debt management on REITs’ operating profitability cannot be ruled out. The direction of these effects, however, appears to be opposite to that of asset management. These results call for renewed and further investigations of optimal REIT capital structure.