1. The Impact of Urban Centralities on Housing Values Aurélien DECAMPS BEM – KEDGE Business School aurelien.decamps@bem.edu Frédéric GASCHET, Guillaume POUYANNE, Stéphane VIROL GRETHA UMR CNRS 5113 University Montesquieu Bordeaux IV frederic.gaschet@u-bordeaux4.fr guillaume.pouyanne@u-bordeaux4.fr stephane.virol@u-bordeaux4.fr European Real Estate Society 20th Annual Conference 3rd-6th July 2013

2. Presentation  Background  Data and Method  Results  Conclusion 2ERES Conference 2013

3. Background ERES Conference 20133  The « polycentric city » :  Emergence of subcenters (Giuliano and Small, 1991; Cervero and Wu, 1997; Bogart and Anderson, 2001)  Economically specialized (Gaschet, 2001; Bingham and Kimble, 1995)  Two types of subcenters (Muniz et al., 2009) : Suburbanization of jobs - Integration of remote medium-sized city

4. Background ERES Conference 20134  Density polycentric gradients :  A growing impact of subcenters on :  Residential density (McMillen and McDonald, 1998)  Job density (Small and Song, 1994)  The price gradient :  Back to the origins of urban economics …  Job accessibility is capitalized into prices  Taking in account amenities  The degree of substituability/complementarity of the subcenters under question (Sivitanidou, 1997)

5. Background ERES Conference 20135 Price gradient regarding type of subcenters Housing prices Distance to the CBD SubcenterCBD Strong complementarity Strong Substituability Medium Complementarity

6. Data and Method ERES Conference 20136  A step-by-step approach : 1. Identification of subcenters 2. Hedonic model of housing prices in a polycentric city 3. Test of complementarity between centers  Data :  PERVAL database on real estate transactions (2000-2006)  French Institute of Statisitics : neighborhood income level (2000)  Corine Land Cover : main land uses (2000)  A very rich database

7. Data and Method ERES Conference 20137  1. Identification of subcenters  Giuliano and Small (1991)’s criterion : job density and number of jobs : 1 CBD, 9 subcenters

8. Data and Method ERES Conference 20138  2. Hedonic model of housing prices in a polycentric city  Housing is a set of attributes  Intrinsic  Environment  Distance  CBD  Nearest subcenter  « Implicit prices » of each attribute  A log linear spécification (Box Cox)

9. Monocentric Model 9  Expected signs for intrisic characteristics  Impact of local income level (quantiles)  No effect of land use except forest (natural amenities)  Expected signs for distance to CBD and coast  A flattening of the CBD gradient between 2000 and 2006: the « sprawling effect »

10. Polycentric Model 10  Land use more significant  Impact of distance to the CBD and two subcenters  Merignac / Lac  Weaker impact of medium-sized cities  Arcachon: coastal amenities

11. Test of Complementarity between subcenters ERES Conference 201311  The method of minimal distances (McMillen and McDonald, 1998)  Distance to the nearest job center, second nearest, third nearest…  Iterative introduction of these distances  Are housing prices better explained by the nearest (substituability), or the distance to several subcenters (complementarity) ?

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14. Conclusion ERES Conference 201314  Structure of housing prices in a polycentric city  Employment accessibility and distance to subcenters  Amenities:  Socio-economic (local income level)  Natural and coastal amenities (suburbs and Arcachon)  Historical and modern amenities (CBD)  Complementarity between CBD and subcentres vs. Proximity for integrated medium-sized cities  Research perspective  Spatial econometrics and semi-parametric methods to sharpen our results  A comparison of housing and commercial prices