The Significance of Building and Location Characteristics for the Economic Performance of Office Property: A Delphi Approach

In all markets quality and revenues are considered to be connected. In the field of real estate, the íqualityî of the location is considered a particularly influential factor for the realised rent level and asset price. The office space user preferences concerning location characteristics, which are expressed in the implicit price paid for these features, have been extensively analysed. In contrast, the office property features that relate to the physical office building have received less scientific interest. It is reasonable to assume that not only the quality of the location matters, but also the features and the associated quality level of the office building itself. Market reports about obsolete office buildings have highlighted the significance of office building features. An office building can become obsolete, and remain vacant, because its features do not meet current occupiersí requirements. In less extreme cases, occupiers derive less utility from the office building and are willing to pay less. This research focuses on the office space user preferences that relate to the office building features and in a lesser degree to the characteristics relating to the location. Which building and location characteristics contribute to superior performance of office property? Whereby, superior performance is considered to be expressed in high rent revenues per square meter lettable floor area. Based on former research, characteristics are identified which are included in the study. Henceforward, a Delphi panel approach is employed to rank the building and location characteristics according to their significance for the occupiersí value judgement.