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| The Rent Adjustment Process and the
Structural Vacancy Rate in the Commercial Real Estate Market Author: Petros S. Sivitanides Start Page: 195 Abstract: Existing studies of
the office-rent adjustment process employ empirical model specifications that assume an
intertemporally constant structural vacancy rate. Such specifications, however, contradict
prevailing theoretical definitions of the latter which point towards its intertemporal
variability. Against this background, this study extends the traditional rent adjustment
specifications to account for an intertemporal variable structural vacancy rate. The
empirical results suggest that the extended model may be more appropriate than the
traditional one in explaining office rent changes during the period 1980-1988. They also
suggest that the structural vacancy rate may indeed vary both through time and across
markets. |
