Calibrate your Real Estate

Katz, Michael; Prins, Edmund
January 1999
Financial Executive;Jan/Feb1999, Vol. 15 Issue 1, p42
Academic Journal
The article focuses on managing corporate holdings in the real estate market. Evaluation of financial performance and the efficient use of capital for land, factory, or equipment by the return-on-fixed-assets (ROFA) method is mentioned. ROFA can be increased by a reduction of fixed-asset investments, elimination of surplus assets, consolidation of operating fixed assets, or using off-balance sheet methods such as synthetic leasing. Fruit of the Loom is given as an example of a company that actively managed its real estate portfolio by maximizing the value of surplus assets and selling a facility. Steps in the ROFA process and the market of real estate investment trusts are mentioned. INSET: Panning for Gold.


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