Redevelopment of industrial heritage: Insights into external effects on house prices

Abstract

Local policy makers seek ways to deal with abandoned industrial heritage in their jurisdictions. Many are demolished, but in some cases considerable investments are made to preserve the cultural aspects of industrial sites. The renewal plans are usually designed to stimulate urban renewal in the vicinity of these sites. Little seems to be known about the effectiveness of these policies. In this paper, we study whether the redevelopment of 36 industrial heritage sites in The Netherlands caused positive external effects by investigating the development of house prices in nearby residential areas. We use a difference-in-difference design by comparing quality-adjusted house prices in a predefined target and control area before the start, between the start and the completion and after the completion of the redevelopment. We also model the spatial and temporal dimensions of these external effects. We find that these dimensions matter substantially. We find that negative externalities on house prices before the start completely disappear after the start of the redevelopment of industrial heritage sites. We also find evidence for positive and local effects on house prices after the completion, but this result disappears when we remove the projects located in the largest cities.

Economic sustainability of heritage conservation in Hong Kong: The impact of heritage buildings on adjacent property prices

“…The target group is defined as the private apartment units that are within 100 m radius distance to the selected historic buildings and being transacted over a 10‐year span, that is, 5 years before to 5 years after the heritage grading has been confirmed. The radius has been set as 100 m to avoid geographic distortion due to terrain changes, and such arrangement is comparable with similar research (van Duijn, Rouwendal, & Boersema, ). Meanwhile, this study examines a total of 100 heritage sites specifically selected in the urban areas of Hong Kong, of which 50 are publicly owned, and another 50 are privately‐owned.…”

The external effects of inner‐city shopping centers: Evidence from the Netherlands

“…We incorporate spatial and temporal (interaction) variables to capture the dynamics of external effects, allowing for spatial and temporal changes in the external effects after redevelopment. A similar approach is used in Schwartz et al (2006), Van Duijn et al (2016, and Been et al (2016). Our findings indicate that, before redevelopment, residential properties located within 1,000 m of shopping centers sell for less than comparable properties located further away from shopping centers.…”

“…Policy makers who wish to revitalize neighborhoods do include social cost considerations and sometimes provide public finance in funding alterations to access and parking, or to public space to let a property owner redevelop their property (Ahlfeldt, Maennig, & Richter, 2016). A broad set of literature finds evidence for positive external effects from such place-based investments, such as brownfields (Kiel & Zabel, 2001), cultural heritage (Been, Ellen, Gedal, Glaeser, & McCabe, 2016;Koster & Rouwendal, 2017), industrial heritage (Van Duijn, Rouwendal, & Boersema, 2016), local parks (Livy & Klaiber, 2016), and subsidized housing (Koster & Van Ommeren, 2019;Schwartz, Ellen, Voicu, & Schill, 2006). These empirical studies suggest that property prices tend to be anywhere between 0% and 17% higher in neighborhoods after these investments.…”

Nudging farmers in crop choice using price information: Evidence from Ethiopian Commodity Exchange

“…Located in 94 markets and public gathering places, price ticker boards are used to disseminate real-time price information at the exchange to all market actors across the country. The distance from the nearest plasma screens to each village is used to measure the intensity of access to the price information from the exchange (see also, e.g., Duijn, Rouwendal, & Boersema, 2016;Heintzelman & Tuttle, 2012). The identifying assumption is that in the absence of price ticker screens, there will be no differential change in the average output share of ECX-traded commodities across villages.…”