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Built environment as determinant for attractiveness of location (Gebaute Umwelt als Determinante fuer Lageattraktivitaet: Der Einfluss gebietstypischer Bebauungsstruktur auf Grundstueckspreise in Berlin)

Ahlfeldt, Gabriel M. (2009) Built environment as determinant for attractiveness of location (Gebaute Umwelt als Determinante fuer Lageattraktivitaet: Der Einfluss gebietstypischer Bebauungsstruktur auf Grundstueckspreise in Berlin). DISP, 179 . ISSN 0251-3625

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Abstract

This study aims at assessing external effects of built environment. A hedonic model is employed to assess the percentage impact of area typical building structure on location desirability. We control for location by application of a decentralized approach based on potentiality variables and micro-level data. After controlling for legal building density, location and neighborhood characteristics we find that building structure proves to be a significant determinant for the value of urban land. While areas dominated by Wilhelminian-style attached arrangements generate premiums of up to 7.7%, properties embedded into a post-war modern-style building structure sell at significant discounts of up to 7%. These results not only highlight the role of built environment as determinant for attractiveness of urban location but also allow a considered evaluation of a range of policies for city development. Taking as a basis the market results, it is evident that the policy of careful renewal running since the 1970s enjoys a higher acceptance among; the citizens of Berlin than does a policy epitomized by the radical city rebuilding during the postwar period. However, for the Hansaviertal, which was designed in the course of the Internationale Bauausstellung 1957 by some of the Internationale Bauausstellung 1957 by some of the internationally most recognized architects of that time, we find a significant market premium of 17.6% exceeding the value for all building structures of similar density. Compared to the average modern 1950s developments there is even a mark-on of 21% emphasizing the role of architecture for properties intrinsic value. After all, our results suggest that interventions by the State aiming at improving the quality of architectural and urban designs may be justifiable in terms of welfare and economics and may contribute to an increase in the attractiveness of downtown locations. Our results also indicate that a high building design quality does not necessarily require a historic style in order to impact positively on location desirability

Item Type: Article
Official URL: http://www.nsl.ethz.ch/index.php/en/content/view/f...
Additional Information: © 2009 DISP
Library of Congress subject classification: G Geography. Anthropology. Recreation > G Geography (General)
Sets: Departments > Geography and Environment
Rights: http://www.lse.ac.uk/library/usingTheLibrary/academicSupport/OA/depositYourResearch.aspx
Identification Number: UT ISI:000273583700006
Date Deposited: 16 Feb 2010 17:07
URL: http://eprints.lse.ac.uk/26942/

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