INVESTING IN POSSIBILITIES; EXTENDING THE LIFESPAN OF OFFICE BUILDINGS

Hilde Remøy, Peter de Jong and Wiechert Schenk

ERES from European Real Estate Society (ERES)

Abstract: Office buildings depreciate at an ever increasing pace. Due to functional or aesthetical obsolescence or relative ageing as a result of new building additions, office buildings are left vacant and become redundant. Often these office buildings are not older than 10-15 years. Adaptive reuse or transformation into housing are possible ways of dealing with these buildings, albeit previous research shows that there are many obstacles to be thrived. Next to location characteristics, the main obstacle is the estimated financial non-feasibility, caused by high costs of acquiring the existing structure and high building costs. As an increased lifespan contributes to the sustainability of office buildings, it seems logical to already consider a second use and anticipate upon adaptability and future programmatic change when developing new office buildings. Designing and developing adaptability has been opted for during the last 40 years, but is still not very popular. This paper will answer the following research questions: Which building characteristics enhance the functional lifespan of office buildings? Under which conditions are investments in adaptable office buildings interesting to real estate investors? By reviewing existing studies we study building characteristics that enhance the functional lifespan of office buildings and building characteristics that enhance adaptability. Henceforth, we study the initial and transformation costs for new office buildings, focusing on two standard office building types, the tower and the slab. As a final step, we discuss the willingness to invest in adaptable buildings and investorsí social responsibility in a sustainability context by reviewing our research results in a focus group interview with real estate investors.

JEL-codes: R3 (search for similar items in EconPapers)
Date: 2010-01-01
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Persistent link: https://EconPapers.repec.org/RePEc:arz:wpaper:eres2010_336

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