Journal of Korea Planning Association (국토계획)

Korea Planning Association (대한국토도시계획학회)
권호 표지

Impact of Capital Structure on Construction Firm's Contingent Liability in Real Estate Project Finance

부동산 PF 사업의 자본구조가 건설사의 우발채무위험에 미치는 영향

  • 전재범 (강원대학교 부동산학과)
  • Received : 2013.08.13
  • Accepted : 2013.10.14
  • Published : 2013.11.30
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Abstract

PF(Project Finance) scheme has been widely used through the world for its benefits of mitigating and hedging risks by optimizing asset and capital structure in implementing huge and risky projects. However, the way real estate projects are conducted with PF scheme in Korea has unique characteristics in its capital structure and cash flows unlike in general project finance, thereby causing unexpected outcome, construction firm's contingent liability. Actually, although, even upon financial crises in late 2008, construction firm's contingent liability has negatively worked by costing in various forms and has became one of the important signals to show if the construction firm is financially viable since new IFRS in 2011, there has been just few efforts to understand how it occurs and affects construction firm's risk-reward system. Therefore, this paper is to suggest theoretical framework with relevant financial and economic theories so as to clarify impact of capital structure on construction firm's contingent liability considering unique capital structure, cash flows, and uncertainty of underlying asset in real estate PF project with loan guarantee agreement in Korea.

Keywords

References

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