New Insights into Office Location and Rents

Abstract

This paper investigates the determinants of office location and rent levels under conditions of globalisation. It challenges the conventional view that office market dynamics are primarily shaped by market-related variables, arguing instead that urban planning and municipal investments exert a stronger influence. An innovative methodology and integrated hedonic model are proposed, incorporating planning tools, local characteristics, and agent behaviours. The model is applied to the office market in Porto, Portugal, using GIS-based cartographic and simulation functionalities. The findings underline the role of urban planning in regulating property markets, influencing rent levels, and supporting office location strategies. The research contributes to urban policy by providing a flexible decision-support system, enriching previous location models, and fostering debate on the balance between public intervention and market forces in shaping office rent trends.