The Economic Rationale for Rent and Positioning of Shops in Shopping Centers

Human activity in general and retail consumer behavior in particular is profoundly influenced by built environment. This has necessitated the growth of research in this particular area. This influence can be measured in its degree and shaped through design interventions. Space Syntax, in this context, is an evidence-based approach in planning and design of buildings and urban areas. The purpose of the paper is to identify the spatial-economic rationale behind determining the optimal store area and rent of non-anchor shops and positioning of shops within shopping centers. The paper develops a formal model of bid-rent, based on store location within shopping centers. The model is specified and solved with an objective function of profit maximization. It also considers integration value, which may be understood as a measure of the accessibility of a location, as an aid in explaining the spatial distribution of retail rents.

Type: 
Management
Authors Name: 
Sumanta Deb