caa a22 4500 445316438 CHVBK 20180317142649.0 cr unu---uuuuu 170323e20110701xx s 000 0 eng 10.1007/s11146-010-9243-6 doi (NATIONALLICENCE)springer-10.1007/s11146-010-9243-6 How Entrenchment, Incentives and Governance Influence REIT Capital Structure [Elektronische Daten] [Chinmoy Ghosh, Erasmo Giambona, John Harding, C. Sirmans] Although recent literature has confirmed the importance of viewing a firm's capital structure choices of leverage and debt maturity as jointly determined, to date there has been little analysis of the importance of traditional governance variables on a firm's capital structure decisions using a simultaneous equations approach. We examine the influence of managerial incentives, traditional managerial monitoring mechanisms and managerial entrenchment on the capital structure of Real Estate Investment Trusts (REITs). Using panel data, we estimate a system of simultaneous equations for leverage and maturity and find that firms with entrenched CEOs use less leverage and shorter maturity debt. This is consistent with the expectation that managers acting in their own self interest will choose lower leverage to reduce liquidity risk and use short maturity debt to preserve their ability to enhance their compensation and reputations by empire building. We also find evidence that traditional alignment mechanisms such as equity and option ownership have an offsetting effect; and that firms where the founder serves as CEO choose higher leverage and longer maturity debt. The results also provide evidence that leverage and maturity are substitutes, firms with high profitability and growth opportunities use less leverage and firms with liquid assets use more leverage and longer maturity debt. The Author(s), 2010 Entrenchment nationallicence Managerial incentives nationallicence Corporate governance nationallicence Capital structure nationallicence REIT nationallicence Ghosh Chinmoy University of Connecticut, 2100 Hillside Road, 06269-1041, Storrs, CT, USA aut Giambona Erasmo University of Amsterdam, Roetersstraat 11, 1018 WB, Amsterdam, The Netherlands aut Harding John University of Connecticut, 2100 Hillside Road, 06269-1041, Storrs, CT, USA aut Sirmans C. The Harold J. and Barbara W. Chastain, Eminent Scholar in Real Estate and Business Law, Florida State University, 821 Academic Way, 32306, Tallahassee, FL, USA aut The Journal of Real Estate Finance and Economics Springer US; http://www.springer-ny.com 43/1-2(2011-07-01), 39-72 0895-5638 43:1-2<39 2011 43 11146 https://doi.org/10.1007/s11146-010-9243-6 text/html Onlinezugriff via DOI 1 research-article jats NATIONALLICENCE 856 40 https://doi.org/10.1007/s11146-010-9243-6 text/html Onlinezugriff via DOI NATIONALLICENCE 700 1- Ghosh Chinmoy University of Connecticut, 2100 Hillside Road, 06269-1041, Storrs, CT, USA aut NATIONALLICENCE 700 1- Giambona Erasmo University of Amsterdam, Roetersstraat 11, 1018 WB, Amsterdam, The Netherlands aut NATIONALLICENCE 700 1- Harding John University of Connecticut, 2100 Hillside Road, 06269-1041, Storrs, CT, USA aut NATIONALLICENCE 700 1- Sirmans C. The Harold J. and Barbara W. Chastain, Eminent Scholar in Real Estate and Business Law, Florida State University, 821 Academic Way, 32306, Tallahassee, FL, USA aut NATIONALLICENCE 773 0- The Journal of Real Estate Finance and Economics Springer US; http://www.springer-ny.com 43/1-2(2011-07-01), 39-72 0895-5638 43:1-2<39 2011 43 11146 Metadata rights reserved Springer special CC-BY-NC licence nationallicence BK010053 XK010053 XK010000 NATIONALLICENCE NATIONALLICENCE NL-springer