The determinants of capital structure- In the light of a financial crisis

Abstract

This thesis investigates how the 2008 financial crisis affected the determinants of capital structure of Real Estate Investment Trusts. The crisis brought both regulatory and behavioral changes and we examined how these changes affected a firm’s financing choices. The data sample consisted of listed REITs in the United States and we compared if the same independent variables had a different impact on leverage pre- and post-crisis. The comparison was carried out with a quantitative method by running a regression and comparing the coefficients using a F-test. The results indicated that two variables, growth and profitability, had a different impact on leverage post-crisis. However, due to insignificant coefficients, the study did not conclude the magnitude of this difference.