Financial Flexibility and Investment: Evidence from REIT At-the-Market (ATM) Equity Offerings

This article examines changes in real estate investment around the establishment of at-the-market (ATM) equity programs by equity REITs. We document a significant increase in the rate of investment following an ATM program announcement and its subsequent use. However, we find that ATM access has a differential impact on the investment activity of REITs facing more significant financial constraints. We also provide further evidence that REITs with ATM programs generate positive long-run returns in excess of that of similarly timed SEOs.