Tremors and tenants

Olga Filippova

Journal of Property Investment & Finance, 2016, vol. 34, issue 2, 143-155

Abstract: Purpose - – The purpose of this paper is to explore the changes in commercial office occupiers’ preferences in their building choice as a result of a recent natural disaster which triggered policy changes in building safety. Design/methodology/approach - – This study follows a qualitative research design comprising semi-structured one-on-one interviews with 24 property professionals (commercial leasing agents and property managers) in Auckland, New Zealand. A thematic analysis was employed for identifying, analysing and reporting themes emerged within data. Findings - – Tenants across New Zealand now incorporate earthquake issues in their leasing decisions. Most tenants are familiar with the impending policy changes related to earthquake-prone buildings. The degree to which building standards are incorporated into office occupiers’ choice varies with the size of the organisation and their willingness to invest in their corporate social responsibility. A certain level of overreaction was observed in tenants’ behaviour in the face of risk and uncertainty following the earthquakes. However, risk appears to be subsiding and emphasis is placed on availability of space in desirable locations. Research limitations/implications - – The findings are limited due to a non-random sample selection and a small sample size. Further quantitative research is required to determine if office tenants place a premium on occupying seismically safe buildings since forthcoming regulatory changes have been announced. Practical/implications - – This study provides evidence that imminent building policy changes are efficient in raising public awareness and informing perceptions of potential losses following a recent natural disaster event. Building owners can potentially capitalise on tenants’ desire to occupy high quality space. Originality/value - – This is the first study that develops the knowledge base identifying the perceptions of tenants about seismic safety of buildings since the Canterbury earthquakes. The study also contributes to the literature on the market effect of policy changes triggered by a focusing event.

Keywords: Office buildings; Building regulation; Earthquake risk; Earthquake-prone buildings; Post disaster recovery; Tenants (search for similar items in EconPapers)
Date: 2016
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Persistent link: https://EconPapers.repec.org/RePEc:eme:jpifpp:v:34:y:2016:i:2:p:143-155

DOI: 10.1108/JPIF-09-2015-0064

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