Green Noise or Green Value? Measuring the Effects of Environmental Certification on Office Values

Green Noise or Green Value? Measuring the Effects of Environmental Certification on Office Values This study investigates the price effects of environmental certification on commercial real estate assets. It is argued that there are likely to be three main drivers of price differences between certified and noncertified buildings. These are additional occupier benefits, lower holding costs for investors and a lower risk premium. Drawing upon the CoStar database of U.S. commercial real estate assets, hedonic regression analysis is used to measure the effect of certification on both rent and price. The results suggest that, compared to buildings in the same submarkets, eco‐certified buildings have both a rental and sale price premium. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Real Estate Economics Wiley

Green Noise or Green Value? Measuring the Effects of Environmental Certification on Office Values

Real Estate Economics, Volume 39 (1) – Mar 1, 2011

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Publisher
Wiley
Copyright
© 2010 American Real Estate and Urban Economics Association
ISSN
1080-8620
eISSN
1540-6229
DOI
10.1111/j.1540-6229.2010.00286.x
Publisher site
See Article on Publisher Site

Abstract

This study investigates the price effects of environmental certification on commercial real estate assets. It is argued that there are likely to be three main drivers of price differences between certified and noncertified buildings. These are additional occupier benefits, lower holding costs for investors and a lower risk premium. Drawing upon the CoStar database of U.S. commercial real estate assets, hedonic regression analysis is used to measure the effect of certification on both rent and price. The results suggest that, compared to buildings in the same submarkets, eco‐certified buildings have both a rental and sale price premium.

Journal

Real Estate EconomicsWiley

Published: Mar 1, 2011

References

  • Implicit Forward Rents as Predictors of Future Rents
    Englund, Englund; Gunnelin, Gunnelin; Hoesli, Hoesli; Söderberg, Söderberg
  • The Competitive Effects of a New Product Introduction: A Case Study
    Hausman, Hausman; Leonard, Leonard
  • Office Rent Determinants in the Chicago Area
    Mills, Mills
  • The Determinants of Shopping Center Rents
    Sirmans, Sirmans; Guidry, Guidry

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