Real property, Retail industry, Parking lots, Consumer behavior, Confirmatory factor analysis
The concept of curb appeal and its impact on property values has been largely neglected in the real estate literature. In the context of retail real estate, curb appeal represents the general attractiveness of a store viewed from the sidewalk or parking lot that is expected to affect consumer patronage decisions and consequently property values. We develop a measurement instrument for curb appeal and assess the validity of our measure using exploratory and confirmatory factor analysis. Our results suggest that curb appeal is multi-dimensional and consists of an atmospheric, architectural and authenticity dimension. Using transaction data and a spatial autoregressive model, we find that the atmospheric and architectural component have a positive impact on sales prices of restaurants. We also show that curb appeal dimensions are highly correlated with observable building features traditionally included in hedonic pricing models.
Freybote, J., Simon, L., & Beitelspacher, L. (2016). Understanding the contribution of curb appeal to retail real estate values. Journal of Property Research, 1-15.
Available for download on Thursday, April 26, 2018