 Property appraisal in high-rises: A cooperative game theory approachDanny Ben-Shahar, Yongheng Deng and Eyal Sulganik Journal of Housing Economics, 2009, vol. 18, issue 1, 25-33 Abstract: The construction of the higher stories in a building is utterly contingent upon the construction of the lower ones, while the construction of lower stories does not require the construction of the higher ones. This rationale underlies our adoption of a cooperative game theory methodology for examining the value of units based on the cost approach of land appraisal. Particularly, we propose the Shapley value solution to examine the allocation of the land and construction cost among the stories of the building. We explore the allocation mechanism and derive several closed-form properties by which the value pattern of stories in a building is rationalized. The proposed cost allocation may, among other things, generate values when comparable market prices are unobservable (consistent with the cost approach); may be used by courts in order to compute compensations in cases of disputes regarding expansions and redevelopments of existing structures among co-owners; and may determine the rent cost allocation in an organization with several profit centers located on different floors of a building. Keywords: R31; R32; D63; Shapley; value; High-rises; Cost; allocation; Story; Appraisal (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:jhouse:v:18:y:2009:i:1:p:25-33 Access Statistics for this article Journal of Housing Economics is currently edited by H. O. Pollakowski More articles in Journal of Housing Economics from Elsevier |
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