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Retail Building Cycles: Evidence from Great Britain

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Abstract

This study examines the cyclical pattern of retail property development in Great Britain. It develops and estimates an econometric model of the volume of new development starts for retail buildings. Within the theoretical framework proposed, a dynamic specification based on changes in real retail rents and total consumer spending appears to adequately capture the cyclical variation in retail development. Changes in the values of these variables induce new retail construction within two years and an Almon polynomial lag scheme best describes the dynamic distribution of their lagged effects. Investment market influences on retail building development at the national level are not established in this study. There is also some indication of a changing economic relationship between new retail development and retail rents after mid-1995, but this can only be confirmed by appropriate tests when additional observations become available.

Suggested Citation

  • Sotiris Tsolacos, 1999. "Retail Building Cycles: Evidence from Great Britain," Journal of Real Estate Research, American Real Estate Society, vol. 18(1), pages 197-218.
    • Handle: RePEc:jre:issued:v:18:n:1:1999:p:197-218
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    6. Pain, Nigel & Westaway, Peter, 1994. "Housing, Consumption and Borrowing: An Assessment of Recent Personal Sector Behaviour in the UK," National Institute Economic Review, National Institute of Economic and Social Research, vol. 149, pages 53-64, August.
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    Cited by:

    1. Catherine Jackson & Craig Watkins, 2007. "Supply-Side Policies and Retail Property Market Performance," Environment and Planning A, , vol. 39(5), pages 1134-1146, May.
    2. Vinci, Sabato & Bartolacci, Francesca & Salvia, Rosanna & Salvati, Luca, 2022. "Housing markets, the great crisis, and metropolitan gradients: Insights from Greece, 2000–2014," Socio-Economic Planning Sciences, Elsevier, vol. 80(C).
    3. Davis, E. Philip & Zhu, Haibin, 2011. "Bank lending and commercial property cycles: Some cross-country evidence," Journal of International Money and Finance, Elsevier, vol. 30(1), pages 1-21, February.

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    JEL classification:

    • L85 - Industrial Organization - - Industry Studies: Services - - - Real Estate Services

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