The Beauty Or The Beast? The Influence Of Aesthetics On Structural Vacancy In The Case Of Amsterdam

Financial and real estate crises and ìthe new way of workingî reduce the need for office space, and office markets become replacement markets without a quantitative need for new office buildings: New buildings drive out bad buildings. In the Netherlands, currently 13% of the office space is vacant, of which 60% is regarded redundant or structurally vacant, meaning vacancy of the same square meters for three or more years, without perspective of future tenancy. The Amsterdam office market comprises 6.7 million m2 office space, of which 1.2 million m2 is vacant. Due to the current financial crisis and the ongoing construction of new buildings, the vacancy is expected to increase over the next few years. When relocating, organisations consider buildings and locations within geographically defined markets. Though location characteristics are important, eventually their choice depends on building characteristics. Organisations prefer office buildings that facilitate their main processes, and support their image and financial yield. This paper presents results of our study on the association between structural vacancy and the exterior appearance and internal specifications of the office building. We consider the revealed preferences of office organisations by relating structural vacancy to building characteristics. Based on a stated preferences study we identified building- and location- characteristics that we expect to influence the building appreciation (value-in-use) of office users. Henceforward, we studied the physical characteristics of 200 office buildings and applied logistic regression analyses to determine if a relation exists between the physical characteristics of office buildings and the occurrence of structural vacancy. Understanding office user preferences is important to understand movements within the office market. In our study we reveal that building characteristics have a strong influence on office user preferences. Consequently, building characteristics are important when determining the potential future use of the existing office stock, and when developing new office space.