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Article
Publication date: 12 February 2021

Tess Lambourne

The purpose of this paper is to determine if there is an impact of sustainability on the market in terms of a green premium or a brown discount on the price of commercial…

Abstract

Purpose

The purpose of this paper is to determine if there is an impact of sustainability on the market in terms of a green premium or a brown discount on the price of commercial and residential real estate. It also seeks to identify the incentives and barriers for sustainable developments perceived by real estate professionals.

Design/methodology/approach

The paper investigates the impact of sustainability features on the valuation of buildings in the United Arab Emirates (UAE). The study uses a qualitative structured questionnaire to determine the views of certified real estate valuers and advisors on this subject.

Findings

The results suggest a green premium of at least 1% in the UAE, coming from both supply-side and demand-side, and in commercial and residential sectors. Key barriers for the recognition of green building value include availability of reliable market data, lack of relevant technical skills and apparent client disinterest. Initiatives that would encourage green buildings include financial incentives for key stakeholders, raising and enforcing building standards, and higher energy prices. This paper identifies policy measures that local authorities may consider in transforming to a more sustainable economy. It is expected that such changes would convey to the real estate industry and affiliated stakeholders the financial benefits to be gained from investing in green buildings.

Research limitations/implications

The UAE is not a transparent environment in terms of building prices and rents, and it can be challenging even for experienced professionals to determine whether an observed higher value can truly be considered a green premium. The second issue is that the results may be affected by a “voluntary response bias”, whereby recipients who are interested in sustainability are more likely to have responded to the survey.

Practical implications

This paper identifies policy measures that local authorities may consider in transforming to a more sustainable economy. It is expected that such changes would convey to the real estate industry and affiliated stakeholders the financial benefits to be gained from investing in green buildings.

Originality/value

Most research exploring the value of green buildings originates from developed economies and its applicability to the Middle East is questionable due to its differing origins and unusual development path. This article offers new insights into an under-researched market.

Details

Journal of Property Investment & Finance, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1463-578X

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Article
Publication date: 2 March 2012

Georgia Warren‐Myers

The purpose of this paper is to synthesise the plethora of research that has been conducted into the relationship between sustainability and market value in real estate

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9509

Abstract

Purpose

The purpose of this paper is to synthesise the plethora of research that has been conducted into the relationship between sustainability and market value in real estate, by critically analysing the research and the applicability of sustainability and value research in valuation practice.

Design/methodology/approach

The research on the relationship between sustainability and market value in real estate is examined from the perspective of its usefulness to the valuation profession in providing guidance, information and evidence to be used in valuation practice.

Findings

Existing research conducted into the relationship between sustainability and market value has not provided the valuation profession with evidence which would allow the incorporation of normative theories on the value of sustainability in valuation practice. This review highlights the lack of evidence, and the applicability of current research into sustainability and value to the valuation profession in providing guidance and information in valuing real estate incorporating sustainability.

Practical implications

This paper highlights the limited applicability of research to date in regard to the relationship between sustainability and market value for the valuation profession. The lack of historical evidence, data or information on the quantifiable effects on market value of this new trend (sustainability), leaves the valuation profession uncertain as to the relationship between sustainability and market value. There is a probable risk of valuers interpreting strategic research incorrectly, and making inappropriate adjustments or comparisons because of their lack of knowledge and limited sustainability assessment skills. Although there is an evolving body of knowledge, there is a need for extensive analysis of unbiased, evidence‐based research in individual and broader markets to provide guidance, evidence and knowledge of the implications of sustainability in the valuation of real estate.

Originality/value

The examination of research investigating the relationship between sustainability and value from a valuation perspective provides an alternative insight into the applicability of current research in valuation practice. The increasing profile and role of sustainability in the real estate sector needs to be addressed in valuation practice; however, the variety of research to date needs to be interpreted by valuers in the correct context. This paper brings to light the applicability of sustainability and value research for the broader valuation profession, and the potential implications of misuse or misunderstanding of that research.

Details

Journal of Property Investment & Finance, vol. 30 no. 2
Type: Research Article
ISSN: 1463-578X

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Article
Publication date: 24 May 2013

Louis J. Grabowski and Lars Mathiassen

Sound real estate decisions are both financially and strategically essential to corporate success. Given their importance, this paper aims to illustrate how the actor…

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1875

Abstract

Purpose

Sound real estate decisions are both financially and strategically essential to corporate success. Given their importance, this paper aims to illustrate how the actor network theory (ANT) can be a valuable alternate lens to bounded rational and political perspectives in providing insights into corporate real estate decision‐making processes.

Design/methodology/approach

This exploratory investigation uses a case study approach to retroactively examine the real estate decision‐making process over five to seven years in four organizations ranging in size from four to 125 employees. The study uses multiple data sources including 25 in‐depth interviews, site visits, archival data, websites, documents, and email correspondence.

Findings

Using the constructs of ANT, the findings reveal how real estate decision making involves iterative but identifiable phases through which heterogeneous actors seek to converge diverse interests and where artifacts affect behaviors and outcomes as much as or sometimes more than their human creators.

Research limitations/implications

Given the case study method, this research lacks generalizability. Researchers are encouraged to test the findings in different contexts.

Practical implications

The ANT perspective helps managers faced with real estate decisions to appreciate the relevant matrix of need, power, and interests; recognize and seek to control the power of artifacts; and, view real estate decision making not as simply making a choice among logical alternatives, but as orchestrating a long, complex process.

Originality/value

This investigation compares the perspectives of ANT to the classical bounded rational and political lenses in examining corporate real estate decision making; demonstrates ANT's value in providing additional insights; and, discusses its implications for understanding and managing these complex processes.

Details

Journal of Corporate Real Estate, vol. 15 no. 2
Type: Research Article
ISSN: 1463-001X

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Article
Publication date: 4 September 2017

Pernille Hoy Christensen

The purpose of this paper is to understand both the facts and the values associated with the breadth of issues, and the principles related to sustainable real estate for…

Abstract

Purpose

The purpose of this paper is to understand both the facts and the values associated with the breadth of issues, and the principles related to sustainable real estate for institutional investors. Sustainable real estate is a growing sector within the commercial real estate industry, and yet, the decision-making practices of institutional investors related to sustainability are still not well understood. In an effort to fill that gap, this research investigates the post-global financial crisis (GFC) motivations driving the implementation of sustainability initiatives, the implementation strategies used, and the predominant eco-indicators and measures used by institutional investors.

Design/methodology/approach

This paper presents the results of a three-round modified Delphi study conducted in the USA in 2011-2012 investigating the nature of performance measurements and reporting requirements in sustainable commercial real estate and their impact on the real estate decision-making process used by institutional investors. Two rounds of in-depth interviews were conducted with 14 expert panelists. An e-questionnaire was used in the third round to verify qualitative findings.

Findings

The key industry drivers and performance indicators influencing institutional investor decision making were associated with risk management of assets and whether initiatives can improve competitive market advantage. Industry leaders advocate for simple key performance indicators, which is in contrast to the literature which argues for the need to adopt common criteria and metrics. Key barriers to the adoption of sustainability initiatives are discussed and a decision framework is presented.

Practical implications

This research aims to help industry partners understand the drivers motivating institutional investors to uptake sustainability initiatives with the aim of improving decision making, assessment, and management of sustainable commercial office buildings.

Originality/value

Building on the four generations of the sustainability framework presented by Simons et al. (2001), this research argues that the US real estate market has yet again adjusted its relationship with sustainability and revises their framework to include a new, post-GFC generation for decision making, assessment, and management of sustainable real estate.

Details

Journal of Property Investment & Finance, vol. 35 no. 6
Type: Research Article
ISSN: 1463-578X

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Article
Publication date: 30 September 2021

Taran Kaur and Priya Solomon

Property management in commercial real estate (CRE) is an important operational function that needs to be managed because it brings large cost implications to the…

Abstract

Purpose

Property management in commercial real estate (CRE) is an important operational function that needs to be managed because it brings large cost implications to the organization. As India aspires to become a developed real estate market, analysis of the growing importance of automating property services and technology acceptance by stakeholders are two key concerns that need to be explicitly addressed. This study aims to examine the extent of property technology (PropTech) adoption in India and propose a technology-enabled stakeholder management model in Indian CRE.

Design/methodology/approach

The research is qualitative in nature and follows the grounded theory approach. Research data were collected by conducting a series of semi-structured interviews with 18 property management professionals from different prominent Indian companies using PropTech.

Findings

The findings suggested the nine most typical automated property management functions in Indian CRE. The result of this research is the automated property services model for stakeholder management in CRE. The model demonstrates the value of implementing technology in property services in India.

Practical implications

The study provides useful insights into how artificial intelligence (AI) in property management can be applied to address property-related challenges, various stakeholder needs and improve property performance in accordance with energy efficiency policies.

Originality/value

This paper attempts to add to the limited body of literature on technology in the property management domain. The model demonstrates how automated property services meet the needs of different stakeholders in CRE and provides remote working procedures within the COVID-19 pandemic context.

Details

Property Management, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 0263-7472

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Article
Publication date: 30 October 2019

Anna Wojewnik-Filipkowska, Anna Dziadkiewicz, Wioleta Dryl, Tomasz Dryl and Robert Bęben

Public involvement is essential in the creation of effective local strategies for the development of a sustainable built environment, yet there has been little research on…

Abstract

Purpose

Public involvement is essential in the creation of effective local strategies for the development of a sustainable built environment, yet there has been little research on stakeholder motivation and engagement in the creation of infrastructure-project value, in the entire life cycle of a given project, while different markets show that overlooking stakeholders can negatively affect the success of an infrastructure project. The purpose of this paper is to fill the theory-practice gap that has been discerned, and thus study how early public involvement determines the success of an infrastructure project, which is identified with its value creation (effectiveness, sustainability and utility).

Design/methodology/approach

This research entails a combination of methods. A case study analysis allowed observation of the role the stakeholders play and of how the relationships, perspectives, expectations and risks, along with other soft issues, continue to affect projects. The case study required comprehensive examination of project documentation and conduction of interviews. To collect data, focused group interviews and semi-structured interviews were used, supported with direct questionnaire surveys.

Findings

The study provides evidence that early public engagement can contribute to infrastructure-project value (effectiveness, sustainability and utility). Practically speaking, the stakeholder analysis performed allowed proposal of a general stakeholder analysis framework for infrastructure projects. It can be implemented at each investment phase of the project life cycle, since stakeholders and their motivation may develop and/or change over time, which necessitates development of proper managerial strategies. The findings highlight the opportunities and the challenges faced by stakeholder management.

Research limitations/implications

The limitation of this study derives from the fact that the sample size was small, which was necessary for an in-depth qualitative research and application of the case study method. The observations were made on a selected case study, within a limited period of time, thus the context of the analysis as well as the stakeholder perception was subject to possible change. The research limitations concern the provisional nature of the information obtained, the cross-sectional nature of the analysis itself, and, finally, the inability to predict all future events. Ultimately, stakeholder mapping was performed for the operational phase of the investment exclusively, while the analysis was limited to identification and classification of the stakeholders, including their relationship with the project.

Practical implications

The research conclusions provide useful input for future research on development of effective strategies for management of the shareholders that are related to a given infrastructure project, in order to achieve project success. Simultaneously, from a property perspective, the research has contributed to a better understanding of the importance of infrastructure, on the part of real estate stakeholders.

Social implications

Application of the approach proposed in the study may contribute to early development and implementation of appropriate trust-building processes. The building of relationships between stakeholders enables checks and balances, promotes short- and long-term project benefits, and increases the value of a project.

Originality/value

The novelty of the research consists in the connection, as part of infrastructure projects, of the theory of consumption values and the concept of an investment cycle with the framework of stakeholder analysis.

Details

Journal of Property Investment & Finance, vol. 39 no. 3
Type: Research Article
ISSN: 1463-578X

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Article
Publication date: 23 October 2020

Ashish Gupta and Graeme Newell

This study provides an extensive risk assessment framework for nonlisted real estate funds' (NREFs) portfolio management in India across their life cycle; that is, the…

Abstract

Purpose

This study provides an extensive risk assessment framework for nonlisted real estate funds' (NREFs) portfolio management in India across their life cycle; that is, the investment stage, the monitoring stage and the exit stage in an emerging market context. The study of risk across these three stages is a new addition to the literature and assumes importance in the context of real estate portfolio management for NREFs in the emerging markets (e.g. India), which are predominantly an opportunistic investment play.

Design/methodology/approach

The risk assessment framework is built on the multiactor/multicriteria risk priorities, using analytical hierarchy process (AHP), obtained from 35 experts in four real estate fund management professional groups; namely, investors/fund managers, valuers, consultants and international developers.

Findings

The results demonstrate that the real estate portfolio management risk priorities change across the three life cycle stages of the fund. At the investment stage, specific risks are most critical; at the monitoring stage, it is important to concentrate on all three risks – specific, systematic and management risks; and at the exit stage, systematic risk plays a crucial role. Real estate portfolio management risk evaluation at the subfactor level shows that investee/partner and location selection needs to be critically evaluated at the time of the investment; project execution and quality of development must be monitored during the construction/monitoring period; and repatriation of the funds, currency volatility and exit risk (resale) are critical at the exit stage of the fund.

Practical implications

The understanding of the real estate portfolio management risk transformation across the life cycle stages is crucial for NREF managers for risk minimization, transfer and mitigation strategy formulation in their real estate portfolios. Unlike previous research that evaluates investment risk, this study breaks the NREF's risks into the investment, monitoring and exit stages. The key risk factors for each stage depend on the NREF's real estate activities for that stage. These activities, in turn, give rise to a typical risk profile for that stage. The findings are crucial for the various stakeholders of real estate fund management and policymakers in an emerging market context; particularly India, one of the fastest growing major economies in the world.

Originality/value

This risk assessment framework for simultaneously assessing risk across the three life cycle stages of NREFs is a new addition to the literature.

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Article
Publication date: 25 September 2020

Emelieke Huisman, Rianne Appel-Meulenbroek, Helianthe Kort and Theo Arentze

Board members and real estate managers (decision makers) play an important role in the decision-making process in nursing home organisations. This study aims to provide an…

Abstract

Purpose

Board members and real estate managers (decision makers) play an important role in the decision-making process in nursing home organisations. This study aims to provide an understanding of underlying attributes and benefits sought by decision makers when making nursing home real estate decisions.

Design/methodology/approach

Decision makers from seven different nursing home organisations in The Netherlands were interviewed using the laddering technique to determine the individual requirements, the considerations of the decision alternatives, the relevant attributes and benefits and their mutual relationships.

Findings

This study details the motivations behind real estate management decisions in nursing home organisations. The findings show that apart from financial considerations, decision makers strive to enhance the quality of life and satisfaction of users with their real estate decisions and seek to include residents and employees in the process. These benefits are connected to the goals of well-being and innovation in health care. Furthermore, functionality, physical and functional flexibility and technology are key considerations when undertaking corporate real estate (CRE) decisions, to ensure that real estate management aligns with the strategic goals of the nursing home organisation.

Practical implications

The insights of this study can support decision makers in healthcare facilities to create strategic value with their real estate. Understanding how to obtain certain benefits from nursing home real estate may result in a better realisation of organisational objectives and user needs.

Originality/value

This study reveals the decision-making process in a nursing home context. Moreover, the laddering technique is used as a new method to explore and gain a deep understanding of CRE decision-making processes.

Details

Journal of Corporate Real Estate, vol. 23 no. 1
Type: Research Article
ISSN: 1463-001X

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Article
Publication date: 4 July 2016

Rotimi Boluwatife Abidoye and Albert P.C. Chan

Real estate property has been established as a composite good, and its value is determined by many variables. The heterogeneous nature of real estate property has made…

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1769

Abstract

Purpose

Real estate property has been established as a composite good, and its value is determined by many variables. The heterogeneous nature of real estate property has made different stakeholders value these variables differently. Therefore, this study aims to identify and evaluate these sets of variables which influence residential property value in the Lagos metropolis property market, Nigeria, based on professional valuers’ perception.

Design/methodology/approach

A list of variables that influences property value was generated through literature review, and the list was used to design an online questionnaire that was administered to valuers practicing in the metropolis. The valuers were asked to rank these variables in order of significance. Their response was analysed to establish the mean score of each variable that depicts their level of significance.

Findings

In order of importance, property location, neighbourhood characteristics, property state of repair, size of property, availability of neighbourhood security and age of property are the most highly significant variables that are influential on the property value in the Lagos metropolis.

Practical implications

The findings of this study will inform all existing and prospective real estate stakeholders, including facility managers of the major determinants of the value of their investments and, at the same time, will be a tool for valuers and researchers in property value modelling.

Originality/value

This study is the first attempt to develop a framework of property value determinants in this research area in Nigeria.

Details

Journal of Facilities Management, vol. 14 no. 3
Type: Research Article
ISSN: 1472-5967

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Article
Publication date: 1 April 2004

Susan St Lawrence

If a company wishes to lease office space that reflects its corporate social responsibility (CSR)and brand aspirations, is there property out there to match the demand…

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1283

Abstract

If a company wishes to lease office space that reflects its corporate social responsibility (CSR) and brand aspirations, is there property out there to match the demand? Are developers really resistant to building properties that are environmentally and socially responsible, or is that an outdated myth? If true, what are the pressures driving change in the marketplace and who is applying them? Are the barriers hindering the uptake of sustainability in the corporate real estate market insurmountable? This paper summarises the findings from a stakeholder review carried out as part of the Cambridge University Programme for Industry, Sustainability Learning Network 2003 course, where key players in the corporate real estate arena were asked these questions. It identifies those sectors engaged in driving sustainability uptake and those resistant. It illustrates the level of activity through case studies.

Details

Journal of Corporate Real Estate, vol. 6 no. 2
Type: Research Article
ISSN: 1463-001X

Keywords

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