Predictability of Australian Office Supply
This paper examines how accurate propertyexperts have been in forecasting one andtwo year office supply. The study covers 12years of new supply and refurbishment forecastsfor Australian state capitals. Arange ofstatistical tests shows that the propertyexpert's forecasts for new supply and refurbishedspace provided a poor indicator offuture office supply. The margin of errorsuggests that property experts' assumptionson the timing of future supply were imprecisewith the trend to overestimate new andrefurbished supply, apart for year two refurbishmentforecasts, which underestimatedfuture refurbished space. During the officesupply cycle, the forecast accuracy varied,with relatively good forecasts for new supplyduring the oversupply period, compared withhigh forecast error during the low supplyperiod. A more robust analysis of future supplycould be achieved using probability analysison the timing of new supply, and employingeconometric modelling techniques for refurbishmentforecasts to link property and spacemarket conditions to office lease expiry profiles.
Year of publication: |
2003
|
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Authors: | Higgins David |
Publisher: |
Australian Property Institute |
Saved in:
freely available
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