Deslizamiento

This chapter aims at reviewing the current state of the literature in the field of property brands. In the first step, main research streams on brands in the real estate sector are briefly outlined in order to further differentiate property brands from other types of brands. Afterward, the predominant understanding of property brands in the context of strategic and operational real estate marketing is highlighted and discussed critically. Finally, re- search contributions explicitly focusing on property brands are presented, and their main propositions regarding the likely functions and relevance of brands in an office property context are highlighted.

196

See BACKHAUS et al. (2013), p. 16.

197

See JOHNSTON/LEWIN (1996), p. 9. Value of the

Lease

Level of Repetition

Relevance Time

Restrictions _{Occasion &}

Purpose _Technical Complexity Identification of Space Demand Determination of Requirements and Selection Criteria Search for Information and Evaluation of Exposés

Initial Site Visits and Evaluation of Office Properties Reduction of Options and Negotiations Selection of Office Property and Signing

Internal Approval Processes

Available Office Units Feasible Office Units Perceived Office Units Acceptable Office Units Preferred Office Units Selected Office Units

2.3.2.1 General Literature on Brands in a Real Estate Context

While brands in a property context have been covered in fewer than ten German and in- ternational contributions, the general concept of brands as such has already been studied to a slightly larger extent in other settings in a real estate context. In order to further differ- entiate property brands from other types of brands in the real estate sector, recent publi- cations highlighting the relevance of corporate brands, hotel operator brands, brand ef- fects of corporate buildings, and place brands are briefly outlined in the following.

With regard to the effectiveness of corporate brands in the real estate sector, FAH/CHEOK

(2008) found that property purchasers are brand conscious concerning the developer of a property. In particular, the authors state that a property developer’s image has an influ- ence on customers’ decision making.198 _{The practice-oriented work of S}

TEINER/FINK

(2009) centers on a Real Estate Brand Potential Index for corporate brands in the real es- tate sector and additionally highlights the importance of brands for real estate compa- nies.199 Similarly, VEST (2001) draws attention to favorable functions of corporate brands, such as a reduction in customers’ perceived risk, an improved differentiation from compet- itors, acquisition potentials, enhanced communication effectiveness, and a higher level of negotiation power.200 The three contributions clearly emphasize the value of brands in the real estate industry; however, property brands as such are not in focus.

Several publications have focused on examining brands in the hospitality sector. In this regard, YEILDING/FILDES (2009) identified hotel chain brands as a major success factor for

real estate investors.201 In the same way, HARVEY (2007) and OLSEN et al. (2005) pointed to the importance of operator brands in hotel real estate management, demanding a con- sistent fit between the operator brand and the respective building.202 Moreover, ROUBI

(2004) highlighted the necessity of including operator brands in the valuation of hotel properties.203 Clearly, property brands in the sense of this work must be differentiated from this kind of operator brand since their focus is on companies rather than the properties themselves.

Similar to these company-oriented considerations, several studies address the effective- ness of properties as visual cues of an occupier’s corporate brand. This perspective is closer to the scope of this work since it concerns the property itself and its function as a brand component. In this regard, MARKWICK/FILL (1995) state that organizations’ proper-

ties can act as representations of their brand identity.204 More recently, APPEL- MEULENBROEK et al. (2010) observed that companies are convinced of buildings’ essential

role in their brand strategies.205 Similarly, OMAR/HEYWOOD (2010) and PARK/GLASCOCK

(2010) support the importance of brand management in the context of corporate real es-

198

See FAH/CHEOK (2008), pp. 76-80.

199

See Section Fehler! Verweisquelle konnte nicht gefunden werden. for a detailed discussion

f STEINER/FINK’s (2009) Real Estate Brand Potential Index concerning their conceptualization of

the brand equity construct for corporate brands in the real estate sector.

200

See VEST (2001), pp. 132-133.

201

See YEILDING/FILDES (2009), pp. 16-18.

202

See HARVEY (2007), pp. 189-190; OLSEN et al. (2005), pp. 146-148.

203

See ROUBI (2004), pp. 420-422.

204

See MARKWICK/FILL (1995), pp. 406-408.

205

tate management.206 Finally, PUNJAISRI/WILSON (2007) identify a direct and an indirect brand effect of corporate real estate: On the one hand, buildings directly contribute to the visual identity of their occupiers. On the other hand, they have an indirect influence via their impact on employees’ behavior and productivity.207 _{Clearly, the company-focused}

perspective of these publications considers properties as components of a corporate brand, whereas this work centers on properties as brands themselves.

Another, more geographical research stream refers to so-called place brands that relate to cities, regions, countries, or tourist destinations and to their competition for visitors, inves- tors, residents, and other resources. In this context, a social and political perspective is the basis for brand management considerations.208 In order to further differentiate this type of brand from other fields of brand management, FREIRE (2009) suggests the term “geo-brands.”209

Regarding this, ASHWORTH/KAVARATZIS (2009) point out that in contrast to regular brands from the economic sector that strive for enhanced profitability, place brands aim at the cultural, political, and social development of cities, regions, and coun- tries.210 Consequently, as SKINNER (2008) states, it is arguable whether classic brand management approaches can be transferred to this field since places in the sense of cit- ies, destinations, or even countries lack the characteristics of products and services that can be purchased.211 As a result, findings in the field of place brands can hardly be trans- ferred to the area of property brands. Even if both brand concepts focus on a certain loca- tion, they do not share a joint objective. While property brands aim at a property’s overall performance, place brands try to enhance the political, cultural, and economic develop- ment of cities, regions, or countries.

Altogether, this brief discussion of research contributions covering different perspectives on brands in the real estate sector has demonstrated that a direct transfer of findings from existing research streams to the field of property brands seems impracticable. In particu- lar, company-oriented and place-oriented brand perspectives exhibit a substantially differ- ent focus compared to this work.

2.3.2.2 Property Brands in the Context of Real Estate Marketing Literature

Only recently have marketing issues found their way into real estate practice and – to a lesser extent – research. In particular, excess supply on space and investment markets as well as occupiers’ changing requirements have contributed to a growing awareness of marketing aspects.212 As BRADE et al. (2008) point out, location, architecture, and equip- ment of a building are no longer sufficient to ensure success in the market.213 Similarly, BONE-WINKEL/ISENHÖFER/HOFMANN (2008) emphasize a comprehensive target group ori- entation in property development processes.214 In the English literature, an early contribu-

206

See OMAR/HEYWOOD (2010), pp. 185-186; PARK/GLASCOCK (2010), p. 11.

207

See PUNJAISRI/WILSON (2007), pp. 67-70.

208

See HOSPERS (2004), pp. 271-272.

209

See FREIRE (2009), p. 422.

210

See ASHWORTH/KAVARATZIS (2009), p. 521.

211

See SKINNER (2008), p. 923.

212

See ZIEGLER (2006), pp. 19-21.

213

See BRADE et al. (2008), p. 772.

214

tion by MALIZIA (1990) also highlights marketing as an integral component of property de- velopment. In the same way, GUY/HARRIS (1997) demand a general shift from a technical and functional view on properties toward a utility orientation.215 Newer contributions also demand a stronger integration of real estate marketing into the education of real estate professionals.216 For the German market, the practice-oriented magazine Immobilien-

wirtschaft established an annual specialized marketing award in 2003. However, real es-

tate practice is driven mainly by short-term sales-oriented activities, disregarding the po- tential of a comprehensive marketing concept. Likewise, the majority of contributions on real estate marketing do not go beyond operational recommendations.217

Despite a growing awareness of marketing in a property context, property brands have been widely neglected in real estate research. On the contrary, current research streams focus on marketing rhetoric,218 factors influencing the duration of marketing efforts to re- duce properties’ time on the market,219 _{opportunities and limitations of e-commerce}

tools,220 pricing issues,221 and the use of green building labels for communication purpos- es.222 Additionally, some studies discuss tenant satisfaction and service quality as im- portant objectives of real estate marketing and are aimed at developing comprehensive measurement scales.223

The lack of research in the field of property brands might be partially attributable to the limited perspective on brands that has been applied. For instance, in their widely acknowledged conceptual work on real estate marketing, BRADE (2001, 1998) and BRADE

et al. (2008) differentiate between (1) a strategic level of real estate marketing, determin- ing the overall direction and objectives, and (2) an operational level, comprising product and service policy, communication policy, distribution policy, and pricing policy as the main elements of the marketing mix for implementing the strategy. In this context, the au- thors refer to property branding activities as the selection of an appropriate name, claim, and logo for a building and assign those activities to product policy on operational level.224 From a life cycle perspective, BRADE et al. (2008) assign product policy to the planning, development, and degeneration phases, thus limiting brand management to comparably short periods in a building’s economic life, whereas the time of regular usage is exclud- ed.225

215

See GUY/HARRIS (1997), p. 133.

216

See BURTON/RUTHERFORD (2007), p. 161; BLACK et al. (2003), p. 85.

217

See MATRE (2003), p. 68.

218

See ROBERTSON/DOIG (2010); PRYCE/OATES (2008).

219

See LIN/LIU/VANDELL (2009); Bond et al. (2007); LIN/VANDELL (2007); AL-

LEN/FAIRCLOTH/RUTHERFORD (2005).

220

See ACHARYA/KARGAN/ZIMMERMANN (2010); HENDL/NEVO/ORTALO-MAGN (2009); MUHANNA/WOLF

(2002).

221

See LEVY/FRETHEY-BENTHAM (2010); ALLEN/DARE (2004).

222

See MCALLISTER (2009); D’ARELLI (2008); SHIELDS (2008); VYAS/CANNON (2008); YUDELSON

(2008).

223

See SEILER/REISENWITZ (2010); SEILER et al. (2008); SEILER/SEILER/WEBB (2006); DAB-

HOLKAR/OVERBY (2005).

224

See BRADE et al. (2008), pp. 715-775; BRADE (2001), pp. 49-70; BRADE (1998), p. 70.

225

See BRADE et al. (2008), pp. 719-721. See also the work of ROTTKE/WERNECKE (2008), pp. 211-229 for an in-depth discussion of property life cycles and their implications.

Real estate researchers’ awareness of property brands is still limited and clearly lags be- hind other industry sectors. In particular, the lack of interest seems critical regarding the likely effectiveness of property brands as a means of reducing individuals’ perceived risk in property-related decisions, as discussed in previous sections. In the majority, brand management activities are understood as components of the product policy, being mostly operational. As a matter of fact, a property brand is often only considered as the name of a property.226 Even if the development of a logo, a name, and a claim is recognized as a relevant part of the planning phase in the property life cycle, a strategic perspective on property brands is not common. Consequently, the value of the existing real estate mar- keting literature is limited for this work except for the notion that branding activities are a part of the overall marketing efforts for a property.

2.3.2.3 Specialized Literature on Property Brands

The literature that specializes on property brands is scarce and highly fragmented. In fact, in a comprehensive literature review covering German and international real estate jour- nals, no contribution was identified that explicitly centers on office property brands.227 However, two main research streams can be distinguished: On the one hand, there are several contributions that focus on property brands on a general level, independent of their type of use. On the other hand, a number of publications focus on property brands in the field of shopping centers, where the concept of property brands is more widely estab- lished than in other sectors of the real estate industry. The latter research stream is only briefly outlined due to its limited applicability to the particularities of office properties, whereas the more general contributions are discussed in more detail since they provide some insights for the purpose of this work.

DIXON/ARSTON (2005) and MEJIA/BENJAMIN (2002) highlight the brand of a shopping cen- ter as one of its most decisive success factors. Especially as the number and variety of shopping centers increases, the authors assume that nonspatial factors such as brands gain importance.228 Similarly, a study by the BRITISH COUNCIL OF SHOPPING CENTRES

(2006) covering 23 expert interviews found univocal agreement that brand management is of vital importance for the performance of properties in the retail sector.229 In this respect, a strategic perspective on brand management throughout the building life cycle and a consistent marketing mix were identified as substantial success factors. Regarding con- ceptual approaches, KIRCHER’S (2010) writing seems to be the most recent and compre- hensive contribution in this field. The author enumerates size, tenant mix, architecture, special attractions, and consistent marketing as main drivers of shopping center brands.

226

See, for instance, the contributions of HIRSCHMANN (2010), pp. 19-24 and HEIDER (2001),

pp. 208-209, which both apply this reduced property brand perspective.

227

The literature review covered the following real estate journals: Zeitschrift für Immobilien-

ökonomie, Journal of Property Management, Journal of Property Research, Journal of Real Es- tate Research, Journal of Property Valuation and Investment, Journal of Retail & Leisure Prop- erty, International Real Estate Review, Journal of Corporate Real Estate, Journal of European Real Estate Research, Journal of Real Estate Literature, Journal of Real Estate Practice and Education, Journal of Sustainable Real Estate, Journal of Real Estate Economics, Wharton Re- al Estate Review, and International Journal of Strategic Property Management.

228

See DIXON/ARSTON (2005), pp. 98-100; MEJIA/BENJAMIN (2002), pp. 4-6.

229

Moreover, KIRCHER (2010) postulates top-of-mind awareness as a major objective and emphasizes the importance of controlling instruments in order to assess a shopping cen- ter’s brand awareness and brand image.230 _{However, the author’s argument is based}

mainly on personal experiences and lacks theoretical and empirical validation.

Obviously, from a brand perspective, there is a major difference between shopping cen- ters and office properties. Shopping centers are generally open to the public and ultimate- ly need to account for end consumers’ requirements as a primary objective.231 _{By contrast,}

office properties commonly do not need a strong visitor orientation and can center exclu- sively on the requirements of their occupiers. Consequently, success factors that have been identified for shopping center brands most likely do not apply to office properties. Regarding property brands on a general level, only three contributions that explicitly fo- cused on property brands were identified: VIITANEN (2004), who builds a basic framework of brand components relevant for the development of property brands; HÄGG/SCHEUTZ

(2006), who discuss the impact of property brands on companies’ shareholder value; and ROULAC (2007), who investigates the influence of property brands on the perceived value of properties. In addition, two German publications covering the topic were found: BRADE

et al. (2008), providing some basic considerations on property brand architecture, and MUSSLER (2010), suggesting a concept for a property brand value chain. A critical compar- ison of the five existing contributions on property brands is hardly feasible owing to their vast differences in objectives and methodology and the fact that they all tap into different facets of property brands. However, they do shed light on a series of substantial aspects, and together they form the existing literature in the field of property brands. For this rea- son, the work of these authors is subsequently discussed in some more detail.

VIITANEN (2004) provides the most fundamental contribution in the field of property brands. The author suggests an initial concept for analyzing property brands from a tenant’s per- spective and applies the model in four case studies. Four major interdependent factors are identified as playing a decisive role in the development of property brands: (1) perfor- mance, reflecting the premise itself in terms of its physical and operational functionality; (2) location, referring to the specific area of the property; (3) services, as intangible prod- uct components accompanying the property; and (4) image, denoting a character of ele- gance, prestige, and style. Figure illustrates the four dimensions of property brands fol- lowing the author. On this basis, Viitanen introduces the idea of a scoring tool comprising the four property brand dimensions, which should be operationalized through a set of ap- propriate indicators. A simple three-point scaling (“good”/“normal”/“bad”) is proposed for capturing the relative performance of a subject property brand in comparison to its com- petitors.232 Moreover, the author emphasizes that “The real estate where the enterprise is operating signals the company image and brand of the tenant enterprises quite similarly as its own name, logo, or slogan.”233

From an academic point of view, the author’s contribution seems questionable: In general, the suggested model lacks a clear terminology and theoretical foundation. A definition or 230 See KIRCHER (2010), pp. 43-48. 231 See STURM (2006), pp. 34-37. 232 See VIITANEN (2004), pp. 3-5. 233 VIITANEN (2004), p. 5.

description of the brand concept under investigation is not provided. In the same way, the selection and weight of the four property brand dimensions are not documented or theo- retically grounded. Still, Viitanen provides a vital contribution to the understanding of property brands pointing at a set of potentially relevant aspects of the phenomenon. Moreover, the importance of a measurement and benchmarking model is emphasized.

Figure 5: Structure of the Brand Concept following Viitanen

Source: VIITANEN (2004), p. 3.

In their mainly conceptual work, HÄGG/SCHEUTZ (2006) discuss how architecture and de- sign of properties can be used to create brands for owners and tenants alike. The authors apply the term “property brand” to buildings with a unique design or location that tend to be “(…) brands in themselves (…)”.234 _{According to the authors, the value of a brand gen-}

erally lies in its ability to maintain and create additional earnings. In this light, they state that property brands’ value is twofold: (1) For commercial occupiers, using the brand of the property in which their office or shop is located can enhance their overall performance. This is particularly the case in shopping centers or for consultants and law firms that tend to lease prestigious properties in order to attract customers and employees. (2) From a property owner’s point of view, HÄGG/SCHEUTZ (2006) compare brands with a franchising

system where tenants pay not only for the space as such but also for the brand of the property. The higher the value of the property brand, the higher the rental premium. In or- der to establish property brands, the authors recommend focusing on the uniqueness of buildings, concerning their exterior and interior appearance or their location.235

Hägg/Scheutz’s considerations provide insights in the field of property brands in several ways. The authors highlight that property brands provide benefits not only to the owners of 234 HÄGG/SCHEUTZ (2006), p. 5. 235 See HÄGG/SCHEUTZ (2006), pp. 4-10.

Performance

Services

Location

Image

a brand but also to the tenants. In this respect, the authors also point to the fact that ten- ants might benefit from renting in a specific property so they can demonstrate the produc- tion of their intellectual products in an appropriate environment. Moreover, attention is drawn to the uniqueness of a building’s design and architecture as a constitutive charac- teristic of a property brand.

ROULAC (2007) aims to emphasize brand, beauty, and utility as significant factors of a

property’s value. The author criticizes common approaches to real estate appraisal and points to a lack of understanding of the sources of properties’ actual value. According to ROULAC (2007), an exclusive concentration on technical and functional aspects neglects vital value drivers. The author denotes occupiers’ or purchasers’ perception of a property as the appropriate focal point of property valuations. Against this background, the price that a property commands in the marketplace is seen as a payment for the sensory expe-

In document FACULTAD DE INGENIERÍA (página 42-125)