The management of positive inter-store externalities in shopping centres: some empirical evidence

In enclosed shopping centres, stores benefit from the positive externalities of other stores in the centre. Some stores provide greater benefits to their neighbours than others – for example anchor tenants and brand leading stores. In managing shopping centres, these positive externalities might be captured through rental variations. This paper explores the determinants of rent – including externalities – for UK regional shopping centres. Two linked databases were utilised in the research. One contains characteristics of 148 shopping centres; the other has some 1,930 individual tenant records including rent level. These data were analysed to provide information on the characteristics of centres and retailers that help determine rent. Factors influencing tenant rents include market potential factors derived from urban and regional economic theory and shopping centre characteristics identified in prior retail research. The model also includes variables that proxy for the interaction between tenants and the impact of positive in-centre externalities. We find that store size is significantly and negatively related to tenant with both anchor and other larger tenants, perhaps as a result of the positive effects generated by their presence, paying relatively lower rents while smaller stores, benefiting from the generation of demand, pay relatively higher rents. Brand leader tenants pay lower rents than other tenants within individual retail categories.

Tenant mix variety in regional shopping centres: some UK empirical analyses

The variety and quality of the tenant mix within a shopping centre is a key concern in shopping centre management. Tenant mix determines the extent of externalities between outlets in the centre, helps establish the image of the centre and, as a result, determines the attractiveness of the centre for consumers. This then translates into sales and rents. However, the management of tenant mix has largely been based on perceived “optimum” arrangements and industry rules of thumb. This paper attempts to model the impact of tenant mix on the rent paid by retailers in larger UK shopping centres and, hence, the returns made by shopping centre landlords. It extends work on shopping centre rent determination (see Working Paper 10/03) utilising a database of 148 regional shopping centres in the UK, with detailed data for over 1900 tenants. Econometric models test the relationship between rental levels and the levels of retail concentration and diversity, while controlling for a range of continuous and qualitative characteristics of each tenant, each retail product, and each shopping centre. Factor analysis is then used to extract the core retail and service categories from the tenant lists of the 148 shopping centres. The factor scores from these core retailer factors are then tested against rent payable. The results from the empirical analysis allow us to generate some clear analytical and empirical implications for optimal retail management.

Organocatalytic enantioselective construction of nitrocyclohexanes containing multiple chiral centres via a cascade reaction

The stereoselective construction of complex molecules with multiple stereogenicity in a single step represents an extremely useful, but challenging approach to complexity in chemical synthesis. The development of organocatalytic cascade processes has proven useful in these studies, but reports where four or more stereocentres are created in a single step from just two achiral reagents are rare. Herein we report the development of a novel asymmetric domino Michael-Michael reaction between nitrohex-4-enoates and nitro-olefins to generate cyclohexanes of high complexity, including one with a quaternary centre, and one with five contiguous stereocentres. This methodology provides access to a range of useful nitrocyclohexane derivatives, including a novel class of a-lycorane-like structures.

The appraisal of data centres: deconstructing the cash flow

This paper analyses the appraisal of a specialized form of real estate - data centres - that has a unique blend of locational, physical and technological characteristics that differentiate it from conventional real estate assets. Market immaturity, limited trading and a lack of pricing signals enhance levels of appraisal uncertainty and disagreement relative to conventional real estate assets. Given the problems of applying standard discounted cash flow, an approach to appraisal is proposed that uses pricing signals from traded cash flows that are similar to the cash flows generated from data centres. Based upon ‘the law of one price’, it is assumed that two assets that are expected to generate identical cash flows in the future must have the same value now. It is suggested that the expected cash flow of assets should be analysed over the life cycle of the building. Corporate bond yields are used to provide a proxy for the appropriate discount rates for lease income. Since liabilities are quite diverse, a number of proxies are suggested as discount and capitalisation rates including indexed-linked, fixed interest and zero-coupon bonds.

Dynamic analysis of house price diffusion across Asian financial centres

The aim of this paper is to explore effects of macroeconomic variables on house prices and also, the lead-lag relationships of real estate markets to examine house price diffusion across Asian financial centres. The analysis is based on the Global Vector Auto-Regression (GVAR) model estimated using quarterly data for six Asian financial centres (Hong Kong, Tokyo, Seoul, Singapore, Taipei and Bangkok) from 1991Q1 to 2011Q2. The empirical results indicate that the global economic conditions play significant roles in shaping house price movements across Asian financial centres. In particular, a small open economy that heavily relies on international trade such as – Singapore and Tokyo - shows positive correlations between economy’s openness and house prices, consistent with the Balassa-Samuelson hypothesis in international trade. However, region-specific conditions do play important roles as determinants of house prices, partly due to restrictive housing policies and demand-supply imbalances, as found in Singapore and Bangkok.

Processes controlling atmospheric dispersion through city centres

We develop a process-based model for the dispersion of a passive scalar in the turbulent flow around the buildings of a city centre. The street network model is based on dividing the airspace of the streets and intersections into boxes, within which the turbulence renders the air well mixed. Mean flow advection through the network of street and intersection boxes then mediates further lateral dispersion. At the same time turbulent mixing in the vertical detrains scalar from the streets and intersections into the turbulent boundary layer above the buildings. When the geometry is regular, the street network model has an analytical solution that describes the variation in concentration in a near-field downwind of a single source, where the majority of scalar lies below roof level. The power of the analytical solution is that it demonstrates how the concentration is determined by only three parameters. The plume direction parameter describes the branching of scalar at the street intersections and hence determines the direction of the plume centreline, which may be very different from the above-roof wind direction. The transmission parameter determines the distance travelled before the majority of scalar is detrained into the atmospheric boundary layer above roof level and conventional atmospheric turbulence takes over as the dominant mixing process. Finally, a normalised source strength multiplies this pattern of concentration. This analytical solution converges to a Gaussian plume after a large number of intersections have been traversed, providing theoretical justification for previous studies that have developed empirical fits to Gaussian plume models. The analytical solution is shown to compare well with very high-resolution simulations and with wind tunnel experiments, although re-entrainment of scalar previously detrained into the boundary layer above roofs, which is not accounted for in the analytical solution, is shown to become an important process further downwind from the source.