Agglomeration of global office skyscrapers: Lessons learned Sofia Dermisi Roosevelt University USA

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Agglomeration of global office skyscrapers: Lessons learned

Sofia DermisiRoosevelt University

USA

20th Annual European Real Estate Society Conference

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Presentation Outline

• Previous research

• Study focus

• Research questions/Methodology

• Data

• Global/city spatial distributions - Historical directional distributions

• Results

• Conclusions

2Agglomeration of global office skyscrapers: Lessons learned


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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.



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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



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Research questions/Methodology1) 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.



ln(skyscraper height𝑖) = 𝑎+ 𝛽1𝑃𝑟𝑖 + 𝛽2𝐸𝑐𝑖 + 𝜂𝑖 + 𝑐𝑖 + 𝜀𝑖

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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)



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Global spatial distributions



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Country spatial distributions



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City spatial distributions – Historical directional distributions



More than 20 skyscrapers

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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

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Regions observ.avrg. sd avrg. sd avrg. sd avrg. sd

Asia 256 2002 8 223.37 46.57 48.59 10.27 1,245,045 747,328Europe 22 1997 15 219.41 26.40 48.68 8.15 962,703 372,781Middle East 33 2009 3 236.70 55.43 49.15 11.18 1,033,645 612,813 US 198 1980 20 222.62 39.89 51.54 9.91 1,394,204 558,096

completed height_meters floors Gross_square feet


• Skyscrapers in China represent 64% of the total number across Asia

• Skyscraper measurements are comparable among Asian countries

beyond completion year

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Country observ.avrg. sd avrg. sd avrg. sd avrg. sd

China 185 2003 7 223 44 48 10 1,191,553 698,408Japan 28 1996 12 214 21 46 7 1,822,589 706,683

Singapore 19 1997 13 225 34 47 11 864,115 353,578Malasya 15 1998 8 254 86 57 14 1,104,706 638,468S. Korea 11 2004 10 208 33 44 10 2,101,293 1,522,284Indonysia 9 2007 5 214 22 47 5 839,359 350,187Thailand 9 1999 5 202 15 50 9 1,026,866 506,828

Philipinnes 7 2002 4 212 22 48 5 836,000 252,836Taiwan 3 1999 8 377 186 76 35 2,139,812 82,126



• Europe lacks:

- significant skyscraper presence

- significant completions in recent years

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Germany 6 1997 7 218 32 54 6 1,003,017 189,938U.K 5 1997 12 210 22 45 3 1,073,551 585,536France 4 1991 20 202 23 47 12 886,704 178,610Spain 3 2008 1 240 14 52 4 803,859 310,873



Middle East:

• Lacks significant skyscraper presence

• Skyscrapers are recently completed

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United Arab Emirates 12 2009 3 240 64 48 11 1100193 820,753Qatar 9 2011 1 217 21 52 5 899,104 348,961Kuwait 5 2010 1 261 97 52 18 938,878 656,904Bahrain 3 2007 1 253 12 50 5 920,533 321,413Saudi Arabia 3 2008 7 242 36 38 17 1,773,338 744,813



US cities (10 or more skyscrapers):

• Lack significant new skyscraper completions

• Skyscrapers measurements are comparable

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City observ.avrg. sd avrg. sd avrg. sd avrg. sd

New York City 67 1969 26 221 40 51 10 1,512,671 667,371Chicago 24 1987 19 234 63 54 15 1,679,828 815,422Houston 18 1983 10 225 36 53 9 1,346,627 206,508Los Angeles 13 1981 9 223 33 53 8 1,222,915 250,593Dallas 10 1982 7 222 32 56 7 1,390,839 297,596

Gross sfcompleted heightm floors



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Asia Europe Middle East USCompletion year -8.226E-04 -0.10 -2.292E-03

-0.28 -2.52 -1.05Number of elevators 6.510E-05 0.02 0.01

0.01 6.78 6.78-0.09 -0.12 -0.36 0.01-2.76 -1.02 -2.63 0.250.00 0.06 0.17 0.09-0.14 0.86 0.92 3.460.01 -0.11 0.05 0.010.82 -2.19 0.65 1.28

Composite structure 0.27 -0.16 0.08 0.105.27 -2.46 0.49 4.27

Steel structure 0.15 0.043.66 2.13

Concrete structure 0.13 -0.33 0.39 0.103.55 -3.28 1.34 2.05

GDP - constr. Start -2.290E-06 1.790E-05 -1.566E-04 7.220E-06-0.41 1.92 -2.66 1.43

ln(unemployment rate) -0.02 -0.26 -0.06 0.14-0.69 -2.13 -1.00 3.19

Constant 5.23 5.27 5.19 9.62

Completion Year Clusters 32 14 8 55Countries-absorbed 10 7 6N 211 21 21 193R^2 36.32% 88.77% 94.87% 48.17%vif 3.06 3.02 2.88 3.85Weight used across all models: Gross Square feetStatistially significant at 10% significance levelStatistially significant at 5% significance level

Recession - - constr. Finish

Recession - - constr. Start

Construction finish- start (years)

• 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

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• 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

Results Effects of external and internal conditions on skyscraper heights


China Japan USNumber of elevators 0.006545

6.35-0.11892 -0.12824 0.008459

-1.68 -3.43 0.290.008843 -0.0992 0.100716

0.27 -3.27 3.630.011781 -0.02769 0.007861

1.16 -1.75 1.02Composite structure 0.34411 0.031801 0.09975

4.09 0.61 2.95Steel structure 0.192666 -0.04787 0.063529

2.31 -1.22 1.83Concrete structure 0.217471 0.088133

3.57 1.57GDP - constr. Start 3.95E-05 2.01E-06 1.09E-06

0.51 0.42 0.54ln(unemployment rate) -0.15562 -0.1288 0.133123

-1.61 -2.13 2.74Constant 4.670457 5.035412 5.047366

Completion Year Clusters 26 16 55Cities-absorbed 20 3 29N 128 26 193R 2̂ 40.70% 58.57% 52.80%vif 3.99 7.03 3.29Weight used across all models: Gross Square feetStatistially significant at 10% significance levelStatistially significant at 5% significance level

Recession - - constr. Start

Recession - - constr. FinishConstruction finish- start (years)

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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


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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.


Agglomeration of global office skyscrapers: Lessons learned Sofia Dermisi Roosevelt University USA

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