Wang, Y; Gong, E; Zhang, Y; Yao, Y and Zhou, X (2024) Risk assessment of infrastructure reits projects based on cloud model: A case study of China. Engineering, Construction and Architectural Management, 31(11), pp. 4330-4352. ISSN 0969-9988
Abstract
Purpose: The need for infrastructure is growing as urbanization picks up speed, and the infrastructure REITs financing model has been crucial in reviving the vast infrastructure stock, alleviating the pressure on government funds and diversifying investment entities. This study aims to propose a framework to better assess the risks of infrastructure REITs, which can serve for the researchers and the policy makers to propose risk mitigation strategies and policy recommendations more purposively to facilitate successful implementation and long-term development of infrastructure REITs. Design/methodology/approach: The infrastructure REITs risk evaluation index system is established through literature review and factor analysis, and the optimal comprehensive weight of the index is calculated using the combination weight. Then, a risk evaluation cloud model of infrastructure REITs is constructed, and experts quantify the qualitative language of infrastructure REITs risks. This paper verifies the feasibility and effectiveness of the model by taking a basic REITs project in China as an example. This paper takes infrastructure REITs project in China as an example, to verify the feasibility and effectiveness of the cloud evaluation method. Findings: The research outcome shows that infrastructure REITs risks manifest in the risk of policy and legal, underlying asset, market, operational and credit. The main influencing factors in terms of their weights are tax policy risk, operation and management risk, liquidity risk, termination risk and default risk. The financing project is at a higher risk, and the probability of risk is 64.2%. Originality/value: This research contributes to the existing body of knowledge by supplementing a set of scientific and practical risk evaluation methods to assess the potential risks of infrastructure REITs project, which contributes the infrastructure financing risk management system. Identify key risk factors for infrastructure REITs with underlying assets, which contributes to infrastructure REITs project management. This research can help relevant stakeholders to control risks throughout the infrastructure investment and financing life cycle, provide them with reference for investment and financing decision-making and promote more sustainable and healthy development of infrastructure REITs in developing countries.
| Item Type: | Article |
|---|---|
| Uncontrolled Keywords: | cloud model; infrastructure financing; infrastructure reits; risk assessment |
| Index terms: | risk mitigation, China, body of knowledge, financing, decision-making, methodology, literature review, strategy, infrastructure financing, developing country, default, implementation, project management, risk assessment, factor analysis, risk management, risk factor, effectiveness, life cycle, infrastructure investment, influencing factor, urbanization, liquidity, case study, management risk |
| Subjects: | urban planning, contractual arrangements, knowledge management, economic analysis, environmental hazards, research methods, Geography, financial risk, development economics, data analysis and analytics, risk assessment, data collection methods, dispute resolution, value management, decision analysis, statistical analysis, management, performance management, project management theory and practice |
| Topics: | Quality Management, Legal Issues, Sustainability, Procurement, Risk Management, Project Management, Geographical Context, International Construction, Governance, Information Management, Research Practice, Cost Management, Business Strategy |
| Descriptive scope: | 5 PCTEA |
N.B. Descriptive scope is a count of how many of the five facets of empirical research are indicated by the words used in title, abstract and keywords. It is not intended as a judgement on the research; merely a count of the kind of word we would expect to indicate Phenomenon, Concepts, Theoretical framing, Empirical techniques, Analytical techniques. If all five are present, then a code of “5 PCTEA” will indicate this. If you feel the coding for this record is questionable, we welcome discussion around the terms we matched or the way we categorized them. The facet you would expect may not be coded, or a facet may be coded inappropriately. This can also bear on a larger question, of which facets should be treated as defining in construction management research. Please get in touch, and we will look at it. More details here