Benchmarking and valuation issues in measuring depreciation for European office markets

Neil Crosby, Steven Devaney, Vicki Law

    Research output: Contribution to journalArticlepeer-review

    14 Citations (Scopus)


    Purpose – The paper addresses the practical problems which emerge when attempting to apply longitudinal approaches to the assessment of property depreciation using valuation-based data. These problems relate to inconsistent valuation regimes and the difficulties in finding appropriate benchmarks.

    Design/methodology/approach – The paper adopts a case study of seven major office locations around Europe and attempts to determine ten-year rental value depreciation rates based on a longitudinal approach using IPD, CBRE and BNP Paribas datasets.

    Findings – The depreciation rates range from a 5 per cent p.a. depreciation rate in Frankfurt to a 2 per cent appreciation rate in Stockholm. The results are discussed in the context of the difficulties in applying this method with inconsistent data.

    Research limitations/implications – The paper has methodological implications for measuring property investment depreciation and provides an example of the problems in adopting theoretically sound approaches with inconsistent information.

    Practical implications – Valuations play an important role in performance measurement and cross border investment decision making and, therefore, knowledge of inconsistency of valuation practice aids decision making and informs any application of valuation-based data in the attainment of depreciation rates.

    Originality/value – The paper provides new insights into the use of property market valuation data in a cross-border context, insights that previously had been anecdotal and unproven in nature.
    Original languageEnglish
    Pages (from-to)7-28
    Number of pages22
    JournalJournal of European Real Estate Research
    Issue number1
    Publication statusPublished - 2011


    • Depreciation
    • Rental values
    • Valuation inconsistency
    • European office markets


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