Sustainable construction and financing—asset-backed securitization of expressway’s usufruct with redeemable rights

Journal article (2021)

Authors

Qiming Zhang Beijing Jiaotong University
Linda Yin Nor Tjia City University of Hong Kong
B. Wang Urban Development Management - Architecture and the Built Environment
A. Ersoy Urban Development Management - Architecture and the Built Environment
Research Group
Urban Development Management (Architecture and the Built Environment) (TU Delft)
Copyright: © 2021 Qiming Zhang, Linda Yin Nor Tjia, B. Wang, A. Ersoy
DOI: https://doi.org/10.3390/su13169113
More Info
expand_more

Published Date

2021

Language

English

Faculty

Architecture and the Built Environment

Department

Management in the Built Environment

Research Group

Urban Development Management

Abstract

Asset-backed securitization will greatly promote the sustainability of infrastructure construction and financing. However, there are quite limited researches conducted in this field. Given the project characteristics of infrastructure project securities, this paper proposes the issuance steps of redeemable asset-backed notes (ABN) based on the infrastructure project’s usufruct as the basic asset. Taking the expressway franchise as an example, the issuing scale and coupon rate of the redeemable ABN are determined by the expected cash flow of the expressway, the term structure of random interest rates, and the option-adjusted spread (OAS). In addition, this research analyzes the duration, convexity, and OAS.