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Investment performance within urban regeneration locations

Adair, Alastair, Berry, Jim, McGreal, Stanley, Poon, Joanna, Hutchison, Norman, Watkins, Craig and Gibb, Kenneth 2005, Investment performance within urban regeneration locations, Journal of property investment and finance, vol. 23, no. 1, pp. 7-21.

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Title Investment performance within urban regeneration locations
Author(s) Adair, Alastair
Berry, Jim
McGreal, Stanley
Poon, Joanna
Hutchison, Norman
Watkins, Craig
Gibb, Kenneth
Journal name Journal of property investment and finance
Volume number 23
Issue number 1
Start page 7
End page 21
Total pages 15
Publisher Emerald Group Publising
Place of publication Bingley, England
Publication date 2005
ISSN 1463-578X
1470-2002
Keyword(s) return on investment
property
rental value
yield management
Summary Purpose – Property performance indices have invariably focused upon prime markets with a variety of approaches used to measure investment returns. However, there is relatively little knowledge regarding the investment performance of property in regeneration areas. Indeed, there is a perception that such locations carry increased risk and that the returns achieved may not be sufficient to offset the added risk. The main objective of this paper, therefore, is to construct regeneration property performance indicators consistent with the CBRE rent index and average yield monitor.

Design/methodology/approach – Local market experts were asked to estimate rents and yields for hypothetical standardised offerings for a range of regeneration locations throughout the UK, covering the period 1995 to 2002.

Findings – The results show that rental growth was similar in regeneration locations compared to the prime market. However, the analysis highlights a major yield shift for property in regeneration areas in the short to medium term. The downward pressure in yields would suggest that once a regeneration area becomes established and rental growth emerges, investor interest is stimulated resulting in increased competition and a shortening of yields.

Originality/value – The significance of this research is the quantification of property investment performance from regeneration areas that previously has not been available to investment institutions and decision makers. From a policy perspective this analysis is of relevance in confirming the maturing of locations that have received high levels of public sector support and indicating the effectiveness of regeneration policy mechanisms in creating sustainable urban environments capable of meeting private sector investment goals.
Notes Reproduced with the kind permission of the copyright owner. This paper was presented at the 10th Conference of the European Real Estate Society, Helsinki, Finland 2003
Language eng
Field of Research 159999 Commerce, Management, Tourism and Services not elsewhere classified
Socio Economic Objective 970115 Expanding Knowledge in Commerce, Management, Tourism and Services
HERDC Research category C1.1 Refereed article in a scholarly journal
Copyright notice ©2005, Emerald Group Publishing Limited
Persistent URL http://hdl.handle.net/10536/DRO/DU:30048653

Document type: Journal Article
Collections: School of Management and Marketing
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Every reasonable effort has been made to ensure that permission has been obtained for items included in DRO. If you believe that your rights have been infringed by this repository, please contact drosupport@deakin.edu.au.