How high should you build (Part 1)




condo

The desire of people to work, live and shop in certain locations, combined with the scarcity of developable land in some of these areas, has led to high-rise or "skyscraper" buildings. What determines the optimum height of buildings and what additional factors determine height?

Developers are typically motivated by profit and want to construct a building that produces the best returns compared to their total costs of land plus construction. This is the main factor that determines what is built in combination with planning restrictions. The relationship between the costs of land as a proportion of total cost is a significant factor in determining the amount of space built on a specific plot of land.

When you fly into Bangkok, you see a definite concentration of high-rise buildings and their height has been determined as much by economic factors as by government planning regulations. In most cases, it does not make sense to build high-rise buildings on cheap land. Does height produce better revenue? The answer is mixed, for offices, there is limited evidence the height produces a higher rent. Rents in office buildings for a specific size of space tend to be the same irrespective of the office floor.

Residential prices are very different and developers sell off-plan with price increases for every floor, often adjusting the configurations of upper floor units to further enhance sales prices. When we look at the resale market in completed buildings, the picture is a little different. Height does matter, but there is not a linear increase in resale prices based on height.

 

By : www.bangkokpost.com