Purpose

This study aims to extensively investigate the efficiency of real estate investment trusts (REITs) in Saudi Arabia.

Design/methodology/approach

The study employs the data envelopment analysis on 17 Saudi REITs with an innovative profit-oriented approach in selecting REITs' inputs and outputs.

Findings

It is found that the traditional approach underestimates the efficiency of Saudi REITs in comparison with the profit-oriented approach, implying that relying on the traditional approach in assessing the efficiency of REITs will underestimate their efficiency and provide misleading results about their actual performance. However, both approaches showed that Saudi REITs are very efficient in utilizing their inputs, and the major source of their inefficiency is related to their scale inefficiency. Moreover, small Saudi REITs are more efficient than large ones. Finally, a higher level of debt is supposedly associated with lower levels of efficiency, indicating that Saudi REITs should not rely on debt funding because there is no tax advantage from using debt.

Originality/value

This paper has several contributions to the literature. First, it employs an innovative profit-oriented approach in selecting REITs' inputs and outputs. Second, this study focuses on analyzing the efficiency of REITs in Saudi Arabia, which is the largest country in the Middle East region, regarding size, stock market capitalization and gross domestic product. Finally, to the best of the author's knowledge, this is the first study to investigate the efficiency of REITs in Saudi Arabia, and it provides substantial information for REITs' investors and managers about the current efficiency of the Saudi REITs industry.

中文翻译：

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沙特阿拉伯 REITs 行业的效率：以利润为导向的方法

目的

本研究旨在广泛调查沙特阿拉伯房地产投资信托 (REIT) 的效率。

设计/方法/方法

该研究对 17 家沙特 REITs 进行了数据包络分析，以创新的以利润为导向的方法来选择 REITs 的投入和产出。

发现

研究发现，与以利润为导向的方法相比，传统方法低估了沙特 REITs 的效率，这意味着依赖传统方法评估 REITs 的效率将低估其效率，并提供对其实际业绩的误导性结果。然而，这两种方法都表明沙特 REITs 在利用其投入方面非常有效，其效率低下的主要原因与其规模效率低下有关。此外，小型沙特 REITs 比大型 REITs 更有效率。最后，据推测，较高的债务水平与较低的效率水平相关，这表明沙特 REIT 不应依赖债务融资，因为使用债务没有税收优势。

原创性/价值

这篇论文对文献有几个贡献。首先，它在选择 REITs 的投入和产出时采用了创新的以利润为导向的方法。其次，本研究重点分析中东地区最大国家沙特阿拉伯的 REITs 在规模、股票市值和国内生产总值方面的效率。最后，据作者所知，这是第一项调查沙特阿拉伯 REITs 效率的研究，它为 REITs 的投资者和管理人员提供了有关沙特 REITs 行业当前效率的大量信息。