1. 1 1 Agglomeration of global office skyscrapers: Lessons learned Sofia Dermisi Roosevelt University USA 20 th Annual European Real Estate Society Conference

2. Presentation Outline Previous research Study focus Research questions/Methodology Data Global/city spatial distributions - Historical directional distributions Results Conclusions 2 2 Agglomeration of global office skyscrapers: Lessons learned 20 th Annual European Real Estate Society Conference

3. Previous research Barr J. – 2012 provides evidence of height competition during boom times in New York city Barr J., B. Mizrach, and K. Mundra – 2011 found a lack of international relationship between skyscraper’s height and business cycles Barclays skyscraper index claims a link of the world’s tallest buildings and impeding financial crisis from 1930 – 2010 Barr J. – 2010 study of the Manhattan skyline provides evidence of links between building height and completions as functions of market fundamentals and builders’ egos. 3 3 Agglomeration of global office skyscrapers: Lessons learned 20 th Annual European Real Estate Society Conference

4. Study focus characteristics: Existing office buildings with minor retail component Buildings are located in four regions (Asia, Europe, Middle East and USA) The height of the buildings is 183m (600 ft) or more 4 4 Agglomeration of global office skyscrapers: Lessons learned 20 th Annual European Real Estate Society Conference

5. Research questions/Methodology 1) What is the spatial distributions of office skyscrapers across regions/countries/cities? - GIS mapping – directional distribution (using the standard deviational ellipse) 2) Effects of external and internal conditions on skyscraper heights? - Fixed –effect regression controlling for countries (or cities) while clustering by the year the buildings were completed and weighted by the gross building area. - skyscraper height: in meters - i: takes values from 1 through n representing each of the skyscrapers among 4 regions (Asia, Europe, Middle East and US) - Pr: includes the variables - completion year, number of elevators, the difference between construction finish- start, and dummy variables for recessions and type of structural material - Ec: GDP/capita and unemployment rate - η: reflects the country or city specific characteristics which are time invariant. - c: clustering of skyscraper completion year. 5 5 Agglomeration of global office skyscrapers: Lessons learned 20 th Annual European Real Estate Society Conference

6. Data Office skyscrapers: Address, height, square feet, construction start/completion, number of elevators and structural material (sources: Council of Tall Buildings and Urban Habitat, Emporis.com, Building’s websites) Economic: Recessions (from 1860- 2011), GDP/capita and unemployment rate (sources: NBER, BLS, World Bank, tradingeconomics.com, countries ministries or other reports) Outcomes: 82.3% of office skyscrapers across three regions (Asia, Europe and Middle East) is located in Asia The highest concentration of skyscrapers is in the USA (198) rapidly followed by China (185) 6 6 Agglomeration of global office skyscrapers: Lessons learned 20 th Annual European Real Estate Society Conference

7. Global spatial distributions 7 7 Agglomeration of global office skyscrapers: Lessons learned 20 th Annual European Real Estate Society Conference

8. Global spatial distributions 8 8 Agglomeration of global office skyscrapers: Lessons learned 20 th Annual European Real Estate Society Conference

9. Global spatial distributions 9 9 Agglomeration of global office skyscrapers: Lessons learned 20 th Annual European Real Estate Society Conference

10. Country spatial distributions 10 Agglomeration of global office skyscrapers: Lessons learned 20 th Annual European Real Estate Society Conference

11. City spatial distributions – Historical directional distributions 11 Agglomeration of global office skyscrapers: Lessons learned 20 th Annual European Real Estate Society Conference More than 20 skyscrapers

12. City spatial distributions – Historical directional distributions 12 Agglomeration of global office skyscrapers: Lessons learned 20 th Annual European Real Estate Society Conference More than 20 skyscrapers

13. City spatial distributions – Historical directional distributions 13 Agglomeration of global office skyscrapers: Lessons learned 20 th Annual European Real Estate Society Conference More than 20 skyscrapers

14. City spatial distributions – Historical directional distributions 14 Agglomeration of global office skyscrapers: Lessons learned 20 th Annual European Real Estate Society Conference More than 20 skyscrapers

15. City spatial distributions – Historical directional distributions 15 Agglomeration of global office skyscrapers: Lessons learned 20 th Annual European Real Estate Society Conference More than 20 skyscrapers

16. Descriptive statistics: Asian office skyscrapers represent: 50.3% among the four regions followed by the US with 38.9% 82.3% among the three multi-country regions (Asia, Europe and Middle East) Skyscraper measurements are comparable among regions 16 20 th Annual European Real Estate Society Conference Agglomeration of global office skyscrapers: Lessons learned

17. Descriptive statistics: Skyscrapers in China represent 64% of the total number across Asia Skyscraper measurements are comparable among Asian countries beyond completion year 17 20 th Annual European Real Estate Society Conference Agglomeration of global office skyscrapers: Lessons learned

18. Descriptive statistics: Europe lacks: - significant skyscraper presence - significant completions in recent years 18 20 th Annual European Real Estate Society Conference Agglomeration of global office skyscrapers: Lessons learned

19. Descriptive statistics: Middle East: Lacks significant skyscraper presence Skyscrapers are recently completed 19 20 th Annual European Real Estate Society Conference Agglomeration of global office skyscrapers: Lessons learned

20. Descriptive statistics: US cities (10 or more skyscrapers): Lack significant new skyscraper completions Skyscrapers measurements are comparable 20 20 th Annual European Real Estate Society Conference Agglomeration of global office skyscrapers: Lessons learned

21. 21 Agglomeration of global office skyscrapers: Lessons learned Internal & external conditions do not share a consistent effect on skyscraper’s height across all regions Skyscraper heights of buildings commencing construction during a recession are lower compared to other periods in Asia & Middle East Longer construction times are associated with shorter skyscrapers in Europe An increase in GDP/capita and unemployment rate leads to unexpected effects in the Middle East and the US, respectively Results Effects of external and internal conditions on skyscraper heights

22. Internal & external conditions do not share a consistent effect on skyscraper’s height across all countries Skyscraper heights of buildings commencing construction during a recession are lower compared to other periods in both China & Japan An increase in unemployment rate is associated with a less expected increase in skyscraper’s heights for the US 22 Results Effects of external and internal conditions on skyscraper heights 22 Agglomeration of global office skyscrapers: Lessons learned

23. Conclusions – part 1 Only 7 countries around the world have more than 10 skyscrapers (CN, JP, KR, MY, SG, UAE & US) The oldest skyscrapers worldwide are located in the USA (avrg. completion year 1979) and the newest in S. Korea* (avrg. completion year 2003) The directional distributions show significant spatial shifts in skyscraper development across all cities with more than 20 skyscrapers Asian office skyscrapers represent 82.3% of the three multi-country regions (Asia, Europe and Middle East) with China having the largest footprint Europe has almost a non existing skyscraper footprint compared to the other three regions Middle East has a small but continuously increasing number of newer skyscrapers *countries with 10 or more skyscrapers 23 Agglomeration of global office skyscrapers: Lessons learned

24. Conclusions – part 2 Recessions during construction starts decrease skyscraper’s height in Asia (9.9%) and Middle East (42.8%). The decrease reaches 12.6% in China and 13.6% in Japan. The type of construction material (composite, steel and concrete) affect positively building height mainly in Asia and the US. Increase in unemployment levels have an opposite effect on skyscraper’s height in Europe (-26.3%) and the US (13.9%). Japan has a similar trend with Europe experiencing a 13.7% decrease. The results of this study are aligned with other studies but further exploration of the data is required. 24 Agglomeration of global office skyscrapers: Lessons learned