The Journal of Real Estate Finance and Economics

, Volume 8, Issue 2, pp 151–165

The avenue effect, landmark externalities, and cubic transformation: Manhattan office valuation

  • Leon Shilton
  • Anthony Zaccaria

DOI: 10.1007/BF01097035

Cite this article as:
Shilton, L. & Zaccaria, A. J Real Estate Finan Econ (1994) 8: 151. doi:10.1007/BF01097035


A functional form for the valuation of office buildings is a third-order function that replicates the constrained cost function in which one of the inputs, land, is fixed. The third-order transformation improves a hedonic regression pricing model and reduces the autocorrelation. The presence of neighborhood landmarks, selected avenue address, and building size influence the office building value. The data set includes 103 midtown Manhattan office building sales transactions from 1980 to first quarter 1990.

Key words

Valuationoffice marketstransformationshedonic regression

Copyright information

© Kluwer Academic Publishers 1994

Authors and Affiliations

  • Leon Shilton
    • 1
  • Anthony Zaccaria
    • 2
  1. 1.Fordham University, GBANew York
  2. 2.Lincoln CenterFordham Law SchoolNew York