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Office Rent Determinants: a Hedonic Panel Analysis

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  • Franz Fuerst

    ()
    (Department of Real Estate & Planning, University of Reading Business School)

Abstract

It has been frequently observed that office markets are subject to particularly high fluctuations in rents and vacancy levels, thus exposing real estate investors to considerable risk regarding expected future income streams. This paper analyzes the determinants of office rents and their variability over time and across sub-markets to gain insight into the rent price formation and its stability across space and over time. No support is found for the single-market hypothesis which states that arbitrage opportunities effectively align real estate pricing schemes in various parts of city. Instead, the results suggest that the importance of hedonic pricing factors varies both over time and across submarkets.

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File URL: http://www.henley.reading.ac.uk/rep/fulltxt/1208.pdf
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Bibliographic Info

Paper provided by Henley Business School, Reading University in its series Real Estate & Planning Working Papers with number rep-wp2008-12.

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Length: 48 pages
Date of creation: 2008
Date of revision:
Handle: RePEc:rdg:repxwp:rep-wp2008-12

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Postal: PO Box 218, Whiteknights, Reading, Berks, RG6 6AA
Phone: +44 (0) 118 378 8226
Fax: +44 (0) 118 975 0236
Web page: http://www.henley.reading.ac.uk/
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Related research

Keywords: Real estate; office market; hedonic analysis; panel analysis; market fragmentation; efficient markets; spatiotemporal models;

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References

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