Valuing options to renew at future market value:the case of commercial property leases

In this study,we develop and empirically test a valuation model for a commonly encountered option in office leases:a tenant’s option to renew at future market rent(a fair market value)with lease termination as the maturity date.The model integrates decision analysis with real options analysis and market risk with private risks.“Option value”is defined as the private value of the option to either party pre-contract,while“option price”assumes a fair agreement between transacting parties and can be positive(rental premium paid)or negative(rental discount offered).Without manifest expectations,an analysis of a sample of office leases supports the model’s logic with price estimates in a practical range.The tenants’option price/value is shown to have a negative relationship with the original/renewal lease term;conversely,the landlords’option value is positively related to the original/renewal term.Comparative analyses show that transaction costs have a positive effect on tenants’option value and on prices,while vacancy costs and the vacancy period are both positively related to the landlords’option value and negatively related to price.Market rent is found to have a negative relationship with option price.Overall,this study provides a theoretical analysis and empirical tests of the value of a real option that allows option holders to renew/extend their contracts at a fair market value.

A Conceptual Framework for Commercial Property Price Indexes

The paper studies the problems associated with the construction of price indexes for commercial properties that could be used in the System of National Accounts. Property price indexes are required for the stocks of commercial properties in the Balance Sheets of the country and related price indexes for the land and structure components of a commercial property are required in the Income Accounts of the country if the Multifactor Productivity of the Commercial Property Industry is calculated as part of the System of National accounts. The paper suggests a variant of the capitalization of the Net Operating Income approach to the construction of property price indexes and uses the one hoss shay or light bulb model of depreciation as a model of depreciation for the structure component of a commercial property.

Effect of Secondary Sterilization on the Quality of Roasted Whiteleg Shrimp(Litopenaeus vannamei)

This study was carried out to investigate the effects of secondary sterilization on the quality of roasted shrimp（ Litopenaeus vannamei）with high nutrients. Roasted shrimps were vacuum packaged, with 100 g in each bag, and subjected to secondary sterilization for 30 min at 70, 80,90, 100, 110 and 120 ℃, or for 10, 20, 30, 40 and 50 min at 90℃. Then, the color, textural properties, sensory quality and pH were measured, and whether they were commercially sterile was evaluated. The results showed that with the increase of sterilizing temperature, L＊, a＊and b＊values all decreased. And with the increase of the duration of sterilization, L＊slightly decreased, while a＊and b＊slightly increased. In addition, with the increase in sterilizing temperature, the hardness, gumminess, chewiness and springiness of roasted shrimps increased at first and decreased subsequently, while the adhesiveness kept increasing, and the cohesiveness and shear force slightly declined. With the increasing duration of sterilization,the hardness, adhesiveness and chewiness rose, the cohesiveness and shear force declined, the gumminess decreased at first and increased subsequently, while the springiness increased at first and decreased subsequently. The pH of roasted shrimps varied in a complex pattern when sterilizing temperature was increased, but increased with the increasing duration of sterilization. The results showed that the roasted shrimps secondarily sterilized at 90℃ for 30 min have the best sensory quality, and are commercially sterile.

In Vitro Evaluation of the Feasibility of Commercial Zn Alloys as Biodegradable Metals

In this work, three widely used commercial Zn alloys （ZA4-1, ZA4-3, ZA6-1 ） were purchased and pre- pared by hot extrusion at 200℃. The microstructure, mechanical properties, corrosion behaviors, biocompatibility and hemocompatibility of Zn alloys were studied with pure Zn as control, Commercial Zn alloys demonstrated increased strength and superb elongation compared with pure Zn. Accelerated corrosion rates and uniform corrosion morphologies were observed in terms of commercial Zn alloys due to galvanic effects between Zn matrix and α-Al phases. 100% extracts of ZA4-1 and ZA6-1 alloys showed mild cytotoxicity while 50% extracts of all samples displayed good biocompatibility. Retardant cell cycle and inhibited stress fibers expression were observed induced by high concentration of Zn^2＋ releasing during corrosion. The hemolysis ratios of Zn alloys were lower than 1% while the adhered platelets showed slightly activated morphologies. In general, commercial Zn alloys possess promising mechanical properties, appropriate corrosion rates, significantly improved biocompatibility and good hemocompatibility in comparison to pure Zn. It is feasible to develop biodegradable metals based on commercial Zn alloys.