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Form or function?: the effect of new sports stadia on property prices in London

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  • Ahlfeldt, Gabriel M.
  • Kavetsos, Georgios

Abstract

Professional sports facilities are among the most expensive development projects. Assessing the external effects related to these and the channels through which these effects operate is a challenging task. We propose a strategy to value the external effects stadia deliver to their neighbourhoods based on the variation of property prices. Our strategy allows for unobserved spatial heterogeneity, anticipation effects, and disentangles the stadium’s function as a sports facility from its form as a physical structure that (visually) dominates the neighbourhood. We apply this strategy to two of the largest stadium projects of the recent decade, the New Wembley and the Emirates Stadium in London. Our results suggest there are positive stadium effects on property prices, which are large compared to construction costs. Notable anticipation effects are found immediately following the announcement of the stadium plans. We further argue that stadium architecture plays a role in promoting positive spillovers to the neighbourhood.

Suggested Citation

  • Ahlfeldt, Gabriel M. & Kavetsos, Georgios, 2014. "Form or function?: the effect of new sports stadia on property prices in London," LSE Research Online Documents on Economics 47352, London School of Economics and Political Science, LSE Library.
  • Handle: RePEc:ehl:lserod:47352
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    References listed on IDEAS

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    Cited by:

    1. Gabriel M. Ahlfeldt & Nancy Holman, 2015. "Distinctively Different: A New Approach to Valuing Architectural Amenities," SERC Discussion Papers 0171, Spatial Economics Research Centre, LSE.
    2. Brad R. Humphreys & Adam Nowak, 2015. "Professional Sports Facilities, Teams and Property Values: Evidence from Seattle's Key Arena," Working Papers 15-06, Department of Economics, West Virginia University.
    3. Paul Dolan & Georgios Kavetsos & Christian Krekel & Dimitris Mavridis & Robert Metcalfe & Claudia Senik & Stefan Szymanski & Nicolas R. Ziebarth, 2016. "The Host with the Most? The Effects of the Olympic Games on Happiness," Discussion Papers of DIW Berlin 1599, DIW Berlin, German Institute for Economic Research.
    4. Dolan, Paul & Kavetsos, Georgios & Krekel, Christian & Mavridis, Dimitris & Metcalfe, Robert & Senik, Claudia & Szymanski, Stefan & Ziebarth, Nicolas R., 2016. "The host with the most? The effects of the Olympic Games on happiness," LSE Research Online Documents on Economics 67677, London School of Economics and Political Science, LSE Library.
    5. Gabriel Ahlfeldt & Pantelis Koutroumpis & Tommaso Valletti, 2017. "Speed 2.0: Evaluating Access to Universal Digital Highways," Journal of the European Economic Association, European Economic Association, vol. 15(3), pages 586-625.
    6. Felix Richter, 2014. "Winner Picking in Urban Revitalization Policies: Empirical Evidence from Berlin," ERSA conference papers ersa14p1424, European Regional Science Association.
    7. repec:oup:oxecpp:v:69:y:2017:i:4:p:918-938. is not listed on IDEAS
    8. Gabriel M. Ahfeldt, 2013. "Urbanity," SERC Discussion Papers 0136, Spatial Economics Research Centre, LSE.
    9. Geoffrey Propheter, 2014. "Local Sales Tax Revenue Redistribution and Sports: The Case of Major League Soccer in Bridgeview," Public Budgeting & Finance, Wiley Blackwell, vol. 34(3), pages 73-91, September.
    10. Norwood, Patricia & Eberth, Barbara & Farrar, Shelley & Anable, Jillian & Ludbrook, Anne, 2014. "Active travel intervention and physical activity behaviour: An evaluation," Social Science & Medicine, Elsevier, vol. 113(C), pages 50-58.

    More about this item

    Keywords

    neighbourhood amenities; property prices; sport; stadium impact;

    JEL classification:

    • F3 - International Economics - - International Finance
    • G3 - Financial Economics - - Corporate Finance and Governance

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