Journal of Forest Economics > Vol 40 > Issue 3

Financiers' Perspectives on Wooden Multistory Construction in Finland

Jaakko Jussila, Department of Forest Sciences, University of Helsinki, Finland, jaakko.a.jussila@helsinki.fi , Katariina Heikkinen, Department of Forest Sciences, University of Helsinki, Finland, Ritva Toivonen, Department of Forest Sciences, University of Helsinki, Finland
 
Suggested Citation
Jaakko Jussila, Katariina Heikkinen and Ritva Toivonen (2025), "Financiers' Perspectives on Wooden Multistory Construction in Finland", Journal of Forest Economics: Vol. 40: No. 3, pp 259-295. http://dx.doi.org/10.1561/112.00000594

Publication Date: 11 Sep 2025
© 2025 J. Jussila et al.
 
Subjects
Behavioral finance,  Uncertainty,  Forestry,  New business financing,  Financial markets,  Behavioral decision making,  Individual decision making,  New product diffusion,  Financial services
 
Keywords
JEL Codes: D81G21L73L74Q01
 

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Open Access

This is published under the terms of CC-BY.

In this article:
1 Introduction 
2 Theoretical Background 
3 Materials and Methods 
4 Results 
5 Discussion 
Appendix 
References 

Abstract

This study explores the investment funding process and financial professionals' perceptions of wooden multistory construction (WMC) projects, with particular focus on risk assessment and sustainability. Through ten thematic expert interviews, we examine: 1) funding criteria for residential construction projects, 2) the role of sustainability as a decision-making criterion, and 3) the risks and opportunities for WMC projects as perceived by financiers. Applying the lenses of prospect theory and a property investment decision model, our findings show that financiers prioritize traditional monetary criteria like profitability, competitiveness, and risk-return ratios over building materials or sustainability. Key non-monetary criteria include location, energy efficiency, and pre-marketing. Perceived risks of WMC financing include uncertainty over life cycle costs and contractor expertise regarding the new technology. Despite acknowledging WMC's potential benefits for sustainability and profitability, our study suggests that finance sector professionals emphasize negative risks over positive opportunities for WMC. This leads to a preference for financing traditional construction projects.

DOI:10.1561/112.00000594