The dynamics and measurement of commercial property depreciation in the UK

Beginning with an extensive literature review, this new research summary report analyses the process of rental depreciation, its effect on the performance of rents, and the impacts of capital expenditure on depreciation. It is based on an analysis of more than 700 commercial and industrial properties and newer property types and it is the most comprehensive national study of rental depreciation since the 1986 CALUS report. The report will be of interest to valuers, fund managers, institutional investors and their advisors and researchers.

Information content and forecasting ability of sentiment indicators: case of real estate market

We evaluate a number of real estate sentiment indices to ascertain current and forward-looking information content that may be useful for forecasting demand and supply activities. Analyzing the dynamic relationships within a Vector Auto-Regression (VAR) framework and using the quarterly US data over 1988-2010, we test the efficacy of several sentiment measures by comparing them with other coincident economic indicators. Overall, our analysis suggests that the sentiment in real estate convey valuable information that can help predict changes in real estate returns. These findings have important implications for investment decisions, from consumers' as well as institutional investors' perspectives.

Financialisation, the valuation of investment property and the urban built environment in the UK

The financialisation literature has been criticised for its limited empirical base and its failure adequately to link the everyday world with that of high finance. The paper addresses these shortcomings by examining the calculative practice of property valuation. The way that valuations are performed affects their results and, therefore, the operation of the property market. The paper traces the evolving influence of finance capital on the valuation of commercial property in the UK by constructing a historiography of investment valuation since 1960. Traditional approaches to valuation have been increasingly challenged by those derived from financial economics. However, the former remains the dominant method for undertaking market valuation. Its grounding in comparison – a centring and standardising process – offers an explanation for some of the changes in the urban built environment that are ascribed to financialisation. This suggests that a more detailed and historically sensitive interpretation of financialisation is required.

Low-frequency volatility of real estate securities in relation to macroeconomic risk

Real estate securities have a number of distinct characteristics that differentiate them from stocks generally. Key amongst them is that under-pinning the firms are both real as well as investment assets. The connections between the underlying macro-economy and listed real estate firms is therefore clearly demonstrated and of heightened importance. To consider the linkages with the underlying macro-economic fundamentals we extract the ‘low-frequency’ volatility component from aggregate volatility shocks in 11 international markets over the 1990-2014 period. This is achieved using Engle and Rangel’s (2008) Spline-Generalized Autoregressive Conditional Heteroskedasticity (Spline-GARCH) model. The estimated low-frequency volatility is then examined together with low-frequency macro data in a fixed-effect pooled regression framework. The analysis reveals that the low-frequency volatility of real estate securities has strong and positive association with most of the macroeconomic risk proxies examined. These include interest rates, inflation, GDP and foreign exchange rates.

Assessing the accuracy and dispersion of real estate investment forecasts

Existing empirical evidence has frequently observed that professional forecasters are conservative and display herding behaviour. Whilst a large number of papers have considered equities as well as macroeconomic series, few have considered the accuracy of forecasts in alternative asset classes such as real estate. We consider the accuracy of forecasts for the UK commercial real estate market over the period 1999-2011. The results illustrate that forecasters display a tendency to under-estimate growth rates during strong market conditions and over-estimate when the market is performing poorly. This conservatism not only results in smoothed estimates but also implies that forecasters display herding behaviour. There is also a marked difference in the relative accuracy of capital and total returns versus rental figures. Whilst rental growth forecasts are relatively accurate, considerable inaccuracy is observed with respect to capital value and total returns.

Do laws influence the cost of real estate brokerage services? A state fixed effects approach

A FTC-DOJ study argues that state laws and regulations may inhibit the unbundling of real estate brokerage services in response to new technology. Our data show that 18 states have changed laws in ways that promote unbundling since 2000. We model brokerage costs as measured by number of agents in a state-level annual panel vector autoregressive framework, a novel way of analyzing wasteful competition. Our findings support a positive relationship between brokerage costs and lagged house price and transactions. We find that change in full-service brokers responds negatively (by well over two percentage points per year) to legal changes facilitating unbundling

Thermal and visual performance of real and theoretical thermochromic glazing solutions for office buildings

Thermochromic windows are able to modulate their transmittance in both the visible and the near-infrared field as a function of their temperature. As a consequence, they allow to control the solar gains in summer, thus reducing the energy needs for space cooling. However, they may also yield a reduction in the daylight availability, which results in the energy consumption for indoor artificial lighting being increased. This paper investigates, by means of dynamic simulations, the application of thermochromic windows to an existing office building in terms of energy savings on an annual basis, while also focusing on the effects in terms of daylighting and thermal comfort. In particular, due attention is paid to daylight availability, described through illuminance maps and by the calculation of the daylight factor, which in several countries is subject thresholds. The study considers both a commercially available thermochromic pane and a series of theoretical thermochromic glazing. The expected performance is compared to static clear and reflective insulating glass units. The simulations are repeated in different climatic conditions, showing that the overall energy savings compared to clear glazing can range from around 5% for cold climates to around 20% in warm climates, while not compromising daylight availability. Moreover the role played by the transition temperature of the pane is examined, pointing out an optimal transition temperatures that is irrespective of the climatic conditions.

Dynamic picture of the inner asteroid belt: implications for the density, size and taxonomic distributions of real objects

In this paper, we construct a dynamic portrait of the inner asteroidal belt. We use information about the distribution of test particles, which were initially placed on a perfectly rectangular grid of initial conditions, after 4.2 Myr of gravitational interactions with the Sun and five planets, from Mars to Neptune. Using the spectral analysis method introduced by Michtchenko et al., the asteroidal behaviour is illustrated in detail on the dynamical, averaged and frequency maps. On the averaged and frequency maps, we superpose information on the proper elements and proper frequencies of real objects, extracted from the data base, AstDyS, constructed by Milani and Knezevic. A comparison of the maps with the distribution of real objects allows us to detect possible dynamical mechanisms acting in the domain under study; these mechanisms are related to mean-motion and secular resonances. We note that the two- and three-body mean-motion resonances and the secular resonances (strong linear and weaker non-linear) have an important role in the diffusive transportation of the objects. Their long-lasting action, overlaid with the Yarkovsky effect, may explain many observed features of the density, size and taxonomic distributions of the asteroids.

Polar orthogonal representations of real reductive algebraic groups

We prove that a polar orthogonal representation of a real reductive algebraic group has the same closed orbits as the isotropy representation of a pseudo-Riemannian symmetric space. We also develop a partial structural theory of polar orthogonal representations of real reductive algebraic groups which slightly generalizes some results of the structural theory of real reductive Lie algebras. (c) 2008 Elsevier Inc. All rights reserved.

Decolourisation of real textile waste using electrochemical techniques: Effect of electrode composition

The present paper presents the study of the decolourisation of real textile effluent by constant current electrolysis in a flow-cell using a DSAO type material. The effect of using different anode materials (Ti/Ru0.3Ti0.7O2; Ti/Ir0.3Ti0.7O2; Ti/RuxSn1-xO2, where X = 0.1, 0.2 or 0.3) on the efficiency of colour removal is discussed. Attempts to perform galvanostatic oxidation (40 and 60 mA cm(-2)) on the as-received effluent demonstrate that colour removal and total organic carbon (TOC) removal are limited. In this case the greatest degree of colour removal is achieved when anode containing 90% SnO2 is used. If the conductivity of the effluent is increased by adding NaCl (0.1 mol L-1) appreciable colour/TOC removal is observed. The efficiencies of colour and TOC removal are discussed in terms of the energy per order (E-EO/kWhm(-3) order(-1)) and energy consumption (E-C/kW h kg(-1) TOC), respectively. Finally, the extent of colour removal is compared to consent levels presented in the literature. (C) 2008 Elsevier B.V. All rights reserved.

Photo-assisted electrochemical degradation of real textile wastewater

In the present study, photo-assisted electrochemical degradation of real textile wastewater was performed. Degradation assays were performed at constant current (40 mA cm(-2)) in a combined electro/photochemical flow-cell using a Ti/Ru(0.3)Ti(0.7)O(2) DSA(R) type electrode. The results show that the method is capable of removing color and chemical oxygen demand (COD) from the effluent. Additionally, the effect of initial pH and type of supporting electrolyte (Na(2)SO(4) or NaCl) was investigated. The principal figures of merit used in this study were COD removal and color removal (605 nm). The results show that up to 72% color and up to 59% COD removal in 120 min is possible under the operating conditions employed. Studies of the phytotoxicity of the wastewater before and after the photo-assisted degradation assays are also presented and the results demonstrate that the toxicity of the effluent is dependent on the length of electrolysis time and the treatment procedure employed.

Decomposing Consumer Wealth Effects: Evidence on the Role of Real Estate Assets Following the Wealth Cycle of 1990-2002

During the period of 1990-2002 US households experienced a dramatic wealth cycle, induced by a 369% appreciation in the value of real per capita liquid stock market assets followed by a 55% decline. However, consumer spending in real terms continued to rise throughout this period. Using data from 1990-2005, traditional life-cycle approaches to estimating macroeconomic wealth effects confront two puzzles: (i) econometric evidence of a stable cointegrating relationship among consumption, income, and wealth is weak at best; and (ii) life-cycle models that rely on aggregate measures of wealth cannot explain why consumption did not collapse when the value of stock market assets declined so dramatically. We address both puzzles by decomposing wealth according to the liquidity of household assets. We find that the significant appreciation in the value of real estate assets that occurred after the peak of the wealth cycle helped sustain consumer spending from 2001 to 2005.

Application Of Real-Time Control Strategy To Improve Nitrogen Removal In Wastewater Treatment

Biological nitrogen removal is an important task in the wastewater treatment. However, the actual removal of total nitrogen (TN) in the wastewater treatment plant (WWTP) is often unsatisfactory due to several causes, one of which is the insufficient availability of carbon source. One possible approach to improve the nitrogen removal therefore is addition of external carbon source, while the amount of which is directly related to operation cost of a WWTP. It is obviously necessary to determine the accurate amount of addition of external carbon source according to the demand depending on the influent wastewater quality. This study focused on the real-time control of external carbon source addition based on the on-line monitoring of influent wastewater quality. The relationship between the influent wastewater quality (specifically the concentration of COD and ammonia) and the demand of carbon source was investigated through experiments on a pilot-scale A/O reactor (1m3) at the Nanjing WWTP, China. The minimum doses of carbon source addition at different situations of influent wastewater quality were determined to ensure the effluent wastewater quality meets the discharge standard. The obtained relationship is expected to be applied in the full-scale WWTPs. .