The Effects Of Financing Structure Of A Share Real Estate Enterprises On Performance

The real estate industry, as the focus of social concern, has become one of the hot investing fields in Chinese economic system. Not only does it concern the well-being of the citizens, but also the development of upstream-downstream industries. The real estate industry is characteristic both of its large industrial chain and intensive capital, where a massive investment is required, as well as a relatively long payback period. For this feature, the companies have to tap into lines of credit and other financing channels to ensure a smooth project, which shows that the development of such kind of companies is closely bound up with the assistance from the field of finance, resulting in the complexity and diversity of the enterprises’financing structure. Over the past 2 decades, the real estate enterprises have been expanding rapidly, and there’s a savage trend in its development patterns. With a great variety of financing modes turning up, especially the massive rises in indirect financing represented by debt financing, among which mainly comprises bank credits and financial institutions. However, direct financing like equity financing constitutes a relatively lower proportion, showing a serious lack of the function of social supervision.This paper mainly adopts the way of normative research and empirical research to analyze the effects of financing structure of A share real estate enterprises on performance, choosing 2008-2012 open financial data of 128 real estate enterprises that have been listed on Shanghai and Shenzhen A-share markets as the basis for calculating each index, constructing panel data, establishing the financing structure index of real estate enterprises and relevant evaluation index of its performance. Then the performance of the company can be divided into three parts: profitability, operation capability, development capability. The result of each performance can be achieved by employing factor analysis method, after which the regression equation with first-order lag item is established separately. It can thus be concluded that endogenous financing has a positive impact on the profitability, operation capability, development capability and comprehensive operating performance of real estate enterprises that are listed on A-share market; equity financing has a positive impact on the company’s operation capability, but it also has a negative effect on the development capability of the company in the long term; commercial credit has a negative impact on the company’s operation capability, but a positive one on its development capability; bank credit has a positive impact on the company’s profitability, yet a negative one on its operation capability.