• Mixed Use and Transit Proximity Premiums: Do Accessible, Multiple-Use Properties Generate Price Premiums?

      Asabere, Paul K.; Chinloy, Peter, 1950-; Mao, Connie X.; Andersson, Lynne Mary (Temple University. Libraries, 2020)
      Mixed-use properties have received increased attention over the last 15 years. There are many perceived benefits of mixed-use development, such as Smart Growth, sustainable development, and urban regentrification. The increased interest in mixed-use developments in suburban, less densely populated areas appears to be motivated by changing consumer preferences and the perceived success of these developments by real estate owners, developers, and governing agencies. Real estate developers, owners and investors have asserted that the financial performance and success of mixed-use projects is better than single-use properties. There is limited data or empirical evidence, in trade publications or academic journals, which supports or disproves this assertion. This research uses data from New York City’s five boroughs to empirically study the effects of a property’s use-type on the financial performance of commercial projects in order to determine if a “mixed-use premium” exists. Initial findings suggest that a property with multiple uses generate between an 8.5%–17% price premium on average, though the magnitude of the premium varies from borough to borough. Further, this research also examines the effects of transit proximity on commercial property values in Manhattan. Relevant stakeholders assume that being closer to public transportation will translate into higher market values. The existing literature is mixed, but there appears to be more evidence for a positive relationship between transit proximity and commercial property values. This study will examine the relationship between transit proximity and commercial property values. Preliminary, adding one subway station within a 0.25 miles radius results in a 14% increase in sales price. Further, a Mixed Use-Transit Proximity interaction variable was created which showed a positive, but non-significant relationship to commercial property values in Manhattan.