INTELLIGENT OFFICE BUILDING FEATURES AND CAPITAL VALUE APPRECIATION

Abstract

Since the acceleration of information technology revolution in 1980s, there has been growing demand for high quality building services, information flow and advanced communication channels on office buildings. The increasing use of information technology also modifies the pattern of work of an organisation, which in turn changes the organisational structures. To meet these kinds of changing demand, office buildings have been incorporated with certain degree of building intelligence. The objective of this study is to study the significance of the intelligent features of office buildings on capital value appreciation. In particular, the significance influences of 'space utilisation and flexibility' and 'culture' are being studied alongside with other variables influencing capital value appreciation. In order to achieve the objective, this dissertation develops hedonic capital value growth models to examine the influence of intelligent features of office buildings and other variables. The results show that the intelligent features of office buildings, namely 'space utilisation and flexibility' and 'culture', are not significantly statistically in the hedonic capital value growth model. In addition, backcasting is performed to test the robustness of the hedonic capital value growth model. The results of the backcasting are satisfactory for only the freehold direct office real estate asset. However, with the establishment of such hedonic capital value growth model, other relevant hedonic models for intelligent office building features may be developed.