Market Responses to the Sustainability and Energy Performance of Commercial Property

Are Green Labels More Valuable in Emerging Real Estate Markets?

“…Other researchers rely on propensity score matching to ensure their sample distribution mimicked a randomized distribution of the label treatment across the sample based on observables (Chegut et al, 2014;Eichholtz et al, 2013;Parkinson and Cooke, 2012;Kok et al, 2011). Their results were quantitatively analogous to those found in the aforementioned studies.…”

“…We then apply these weights and re-estimate our baseline hedonic model as in equation 4. Similar techniques were also adopted by Robinson and McAllister (2015), Chegut et al (2014), Eichholtz et al (2013), Parkinson and Cooke (2012), and Kok et al (2011). The hypotheses are tested in the same way as our previous model.…”

Energy performance certification as a signal of workplace quality

“…Rental value was only associated with occupant satisfaction with the aesthetic appearance of a facility. Such associations may confound assertions that the price comparison studies reviewed by Parkinson & Cooke support the view that a change in occupant preferences may have been observed with respect to environmental issues (Parkinson and Cooke, 2011). These findings indicate that it is more likely that associations between rental value and aesthetic appearance provide the most valid explanation for these observed rental premiums.…”

“…This theory was supported by Cronin and Taylor, who explored the possibility that the customer satisfaction of a (2011) Energy performance, as defined by label or certificate Parkinson and Cooke (2011) Property environmental performance, as defined by label or certificate (e.g. BREEAM, LEED) Department of energy and climate change (2010) Operational environmental impact DiPascquale and Wheaton (1996) Running costs (including rent, service charge, and energy costs) Pinder et al (2003) Configuration (including space requirements and adaptability) Pinder et al (2003) Indoor environment (including comfort, acoustics, air & lighting quality and control) Pinder et al (2003) Aesthetic appearance (including cultural significance) Bordass et al (2001) Occupant understanding of how the building operates Bordass et al (2001) Property managers understand workplace sustainability needs Pinder et al (2003) Functionality (including level of distraction, privacy, storage space, security and IT provision) DiPascquale and Wheaton (1996) Location (including proximity to public transport, accessibility, retail, other businesses, and outdoor space) service could be determined either through the product of the perceived importance and performance of a service, or simply its performance only (Cronin and Taylor, 1992).…”

“…Parkinson and Cooke assert that such findings suggest that property investors attribute a low risk premium for more energy efficient commercial office space in the USA. They also conclude that such evidence may suggest a shift in the attitudes of both tenants and investors with respect to environmental issues (Parkinson and Cooke, 2011). Eichholtz et al took an alternative approach to studying the effects of Energy Star labelled property on the performance of US Real Estate Investment Trusts using regression.…”