John Henneberry

Transport investment and house prices

The paper describes the use of hedonic analysis to examine the impact of the South Yorkshire Supertram on house prices in Sheffield. The approach was distinguished by the use of asking prices rather than transaction prices, the use of dummy variables to capture neighbourhood quality effects and the use of a GIS to calculate continuous distance variables. Compared with similar previous studies the equations performed well and identified, for the first time in a British context, a small, discrete transport induced price effect. Supertram initially depressed the prices of nearby houses but prices show signs of recovery. Further research is needed to examine the longer term impact of Supertram on the housing market.

The development of a simple regional office rent prediction model

Attempts to describe the determinants of rent. Describes the initial stages in the development of a regional office rent prediction model which uses readily available data and should aid the investment decision‐making process. Rejects cross‐sectional analysis, preferring time series approaches. Formulates a spatially disaggregated model which allows for delays between changes in user output and changes in user demand, and which reflects the variable adjustment rate between these two factors. Argues that the combined influence of the independent variables in the derived equation can explain up to 97 per cent of the variation in rent over the period examined.

Exploring office investment decision‐making in different European contexts

Purpose – Studies of UK and US property investment markets have historically portrayed the decision‐making process as an exercise in rational analysis. This notion is fundamentally flawed as the concept of a perfect market has limited applicability to the real world context in which property investment decisions are taken. Investment decision‐making is neither clinical nor methodical but is undertaken by imperfect players in imperfect markets using imperfect information. The purpose of this paper is to explore the decision making processes of investors.Design/methodology/approach – A normative‐behavioural framework incorporating heuristics is used, a technique whose application in property research has previously been limited to valuation. The empirical vehicle for the research was an exploration of the spatial dimension of office property investment in different European contexts.Findings – The findings of in‐depth case studies of investment decision‐making in France, Germany and the UK indicate that the...

Predicting Regional Office Rents Using Habit‐persistence Theories

Develops a habit‐persistence model which is based on the assumption that experience conditions present behaviour and expectations. Notes that the model combines the adaptive expectations hypothesis with the partial adjustment process. Concludes that accurate forecasts for declining regions are produced but the results for growing regions are not significant.

Planning obligations, planning practice, and land-use outcomes

An investigation of planning obligations is used to explore the political and economic dynamics associated with the interaction between the planning and development processes. A significant widening in the use and scope of planning obligations has occurred in the last ten years. Obligations are used not only to remove physical constraints on development and to mitigate direct development impacts, but also to ameliorate more diffuse social, economic, and environmental impacts, to provide community benefits, and to support wider policy objectives. This broadening of practice has been spurred on by the austere financial environment within which local authorities must operate. Planning obligations have provided a mechanism for shifting part of the immediate financial burden of the provision of off-site infrastructure, facilities, and services from government to building producers and consumers. This poses a dilemma for planning practice. On the one hand, the profile of planners is raised because they are key negotiators in delivering improvements in local infrastructure and services. On the other hand, the financial aspects of development proposals now influence planning decisions. The potential to negotiate planning obligations is influencing land-use patterns, spatially, sectorally, and in terms of local built form. Short-term planning gains are tending to override longer term planning concerns such as environmental quality. These trends challenge fundamentally our conception of the nature of planning.

Calculated Inequality? Portfolio Benchmarking and Regional Office Property Investment in the UK

The paper explores the reasons for the persistence in the UK of significant relative interregional variations in office property investment in the face of economic theory and empirical evidence that would support its more even spatial distribution. The argument is made from a cultural economy perspective and involves the application to property of a concept drawn from the accountancy literature: calculative practice. UK investment decision-making is distinguished by the primacy attributed to portfolio benchmarking as an influence on investment strategy. The wider logic underpinning property benchmarking is subjected to critical appraisal. Then, evidence is presented that suggests that benchmarking is a self-referential practice which results in convergence and rigidity in fund structures and in the concentration of performance around a bounded range of sub-optimal returns. It is a barrier to the greater geographical diversification of office property investment.

Developers, non‐linearity and asymmetry in the development cycle

Summary There is some evidence of cyclical non‐linearities in the property market but the analytical techniques used to identify them provide no insight into their source or nature. Studies of other sectors of the economy suggest that a primary cause of non‐linearities is the differential response of agents to the same shocks at different stages of the business cycle. Developers are key agents in the property sector and their behaviour may vary between different stages of the development cycle. Computer‐based behavioural modelling is used formally to imitate alternative strategies developers might adopt to formulate profit expectations and, hence, to make development decisions. When developers use current costs and values to determine their expectations the effects of property market price signals are delayed but not exaggerated. When developers’ expectations are conditioned by past experience, the effects of price signals are both delayed and exaggerated. The results of the latter strategy are more marke...

Dealing with Contaminated Land in the UK through ‘Development Managerialism’

Abstract The paper examines the historical evolution of the UK approach to contaminated land. It is argued that the rationale and character of the current policy regime are structured by the dominant discourse dealing with the problem. Successive British governments have pursued a ‘development managerialist’ approach to contaminated land, rather than treating it primarily as an issue of environmental quality or public health. Cost effectiveness has been a recurrent theme in the discourse. It has been made manifest through five key features of the emergent system: (i) the way that contaminated land is defined; (ii) the distinctive liability regime; (iii) the notion of ‘suitable for use’; (iv) its ‘risk-assessment-based’ aspects; and (v) its decentralized, bifurcated structure. A preliminary analysis of the regime suggests that, so far, it has succeeded in containing costs but may leave a toxic debt for future generations to address. In addition, a hitherto un-noted aspect of the contaminated land policy regime is identified; that is, that the differing natures of its two elements—the planning system and Part IIA of the Environmental Protection Act 1990 (‘Part IIA’)—have produced operational tensions that affect policy implementation.

Bridging the Divide? Complementary Perspectives on Property

In a recent paper, we argued for the need to develop an understanding of property development processes which combines a sensitivity to the economic and social framing of development strategies with a fine-grain treatment of the locally contingent responses of property actors. This is a response to Balls criticisms of that paper, which offer a misleading characterisation of our methodological and theoretical position with regard to property research.

Financialisation, the valuation of investment property and the urban built environment in the UK

The financialisation literature has been criticised for its limited empirical base and its failure adequately to link the everyday world with that of high finance. The paper addresses these shortcomings by examining the calculative practice of property valuation. The way that valuations are performed affects their results and, therefore, the operation of the property market. The paper traces the evolving influence of finance capital on the valuation of commercial property in the UK by constructing a historiography of investment valuation since 1960. Traditional approaches to valuation have been increasingly challenged by those derived from financial economics. However, the former remains the dominant method for undertaking market valuation. Its grounding in comparison – a centring and standardising process – offers an explanation for some of the changes in the urban built environment that are ascribed to financialisation. This suggests that a more detailed and historically sensitive interpretation of financialisation is required.