Good buildings drive out bad buildings

Abstract

In the study 'Offices for Living in', published in CIB W104 Open Building Implementation, Mexico 2002, an instrument was developed for measuring the potential of transforming (soon-to-be) empty office premises into homes. As a follow-up, this survey 'Good Buildings Drive out Bad Buildings' looks explicitly at the lower end of the office premises market. The office premises in question have been vacated by organizations that have moved to new premises of a higher quality and in a better location. Depending on the prevailing market conditions, a number of the vacated premises will remain empty. This is particularly true of premises that offer the least quality, whose location is less desirable, or whose price/quality ratio is unattractive. This study introduces an instrument known as the Vacancy Risk Meter (VRM), which allows the so-called lower end of the office premises market in a particular urban district to be defined at an early stage.
The study was aimed at the developments in the office premises market in Rotterdam between 1996 and 1999. This period was characterized by the presence of a relatively high percentage of chronically empty buildings. In the subsequent period, from 1999 to 2002, a more favourable economic climate and altered market forces led to many of the empty buildings being rented out once again as office premises. From 2002 onwards, a growing economic recession has meant that the number of chronically empty buildings is once again on the increase: the cycle is repeating itself.
The Vacancy Risk Meter (VRM) indicates at an early stage which office buildings at which locations are likely to be vacated first due to changes in the market as the current tenants relocate to higher quality premises. This allows the potential and risks for the preservation of the office premises market to be determined for the selected buildings and locations. The VRM therefore allows the lower end of the office premises market to be defined for a particular urban district.
By defining the so-called Vacancy Risk classification for many different premises, a clear picture can be formed of the relative quality of each in relation to the others. A complete overview can be generated at supply level for any given urban district or area of the potential lower end of the market.