Page 452 - Invited Paper Session (IPS) - Volume 1

IPS176 Thomas A. K.
average apartment sizes tend to be the smaller the larger the number of units
in the dwelling.
For Laspeyres-type CPPIs, a base year must be determined. It seems
appropriate to choose 2011 owing to the full recording of the dwellings stock
in the census year. This choice is not at odds with corresponding information
available for the office and retail segments. For the floor space of office
buildings in 127 towns and cities, annual time series are provided by
bulwiengesa. Hence, the 2011 figures can just be taken from this source. The
floor space of retail structures in 2011 can be estimated using the following
official publications: retail space in 2014 broken down in 31 counties, the
inhabitants of these counties and of the 127 towns and cities in 2011 and
2014. The estimates are obtained by imposing the assumptions that the retail
5
space per inhabitant in a town or city be equal to the retail space per
inhabitant in the county the town or city belongs to and that these per-capita
figures do not change over time. An assessment of the quality of these
estimates is possible for those towns and cities for which bulwiengesa data on
retailers’ floor spaces in the period between 2010 and 2012 is available. This
cross-check reveals a very good performance.
By summing up all categories of real estate under consideration, the floor
space in the 127 towns and cities in 2011 amounts 1.2 billion square metres.
Houses and apartments make up almost one-half, multi-family dwellings
about one-third and office and retail more or less one-sixth. With comprising
only office and retail structures, the smallest concept of commercial real estate
(according to CRR) totals 0.2 billion square metres. On the basis of floor space
data, office space is given a three times higher weight than retail. 6 The
inclusion of residential real estate which is rented out by enterprises doubles
the floor space of commercial real estate. Hence, the ESRB definition of
commercial real estate includes rental housing with a share of 50 per cent. In
the broadest concept of commercial real estate which includes rental housing,
regardless of being owned by enterprises or private households, the floor
space of commercial real estate is about 0.9 billion square metres, with multi-
family dwellings contributing almost one-half, buy-to-let houses and
apartments a little more and office and retail a little less than one-quarter.

5 Four Bundesländer (North Rhine-Westphalia, Bavaria, Baden-Wurttemberg, Hesse) are divided
in Regierungsbezirke due to administrative reasons. These 19 administrative units together with
the remaining 12 Bundesländer form the county level considered here.
In the vdp CPPI, office is given a weight of 60 per cent using information about the outstanding
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loans granted by mortgage banks. In the bulwiengesa CPPI, office makes up only a quarter and
retail three quarters, representing the shares of the object types in tradable assets. See also
Knetsch et al. (2019), p. 6.
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