A hedonic price model of office rents

Abstract

The primary objective of this study is to apply hedonic regression techniques to an office market to identify and quantify the significant contribution of the different attributes to office rents. This technique is widely used in the analysis of housing markets but an extensive literature review reveals little application in commercial property markets. The study analyses a sample of 477 asking rents, together with a series of locational and physical attributes, for the City of Glasgow. The results explain approximately 60 per cent of variation in rents across the city, emphasizing the importance of age and location as principal determinants of rents.