Price and spatial distribution of office rental in Madrid: a decision tree analysis
In this paper, we assess the drivers of office rental prices in the municipality of Madrid with a sample of 4,721 offices in March, 2020. The estimation was performed using the decision tree approach, which was built with a random forest algorithm. This technique allows us to capture the strong non...
| Main Authors: | , , |
|---|---|
| Format: | Article |
| Language: | English |
| Published: |
Pontificia Universidad Católica del Perú
2021-10-01
|
| Series: | Economía |
| Online Access: | https://revistas.pucp.edu.pe/index.php/economia/article/view/22227 |
| Summary: | In this paper, we assess the drivers of office rental prices in the municipality of Madrid with a sample of 4,721 offices in March, 2020. The estimation was performed using the decision tree approach, which was built with a random forest algorithm. This technique allows us to capture the strong nonlinear component in the relation between price and its drivers, mainly geospatial location. Through a stratified analysis, we find that the willingness to pay high rent in the center of Madrid is a feature of particular relevance to medium-sized offices. For different reasons, we also find some office clusters located far from the city center with high rent for both large and small offices.
|
|---|---|
| ISSN: | 0254-4415 2304-4306 |