In Korea's commercial real estate market, the office market is the most influential market and has become an attractive alternative investment target for real estate funds and REITs. The two most important indicators in terms of demand in the office market are rent and vacancy rate. Office market research in Korea has been conducted in various ways, from analysis of determinants of rent and vacancy rate to simultaneous equation model, VAR model, and VECM using time series analysis. In particular, research was mainly conducted on the relationship between economic variables and rent and vacancy rates through time series analysis, and until the mid-2010s, most studies proved that there was a negative(-) relationship between rent and vacancy rates. However, many studies have shown that there is no significant relationship between rent and vacancy rate in time series analysis studies containing data since the mid-2010s, and the reason and explanation differed depending on the study. Investment in office buildings is heavily funded. If the rent or vacancy rate indicators do not reflect the market reality, it will add confusion to market participants who want to make decisions through the data. The purpose of this study is to confirm which variables explain the market well in terms of rent and vacancy rate.
In this study, the vacancy rate is defined as a parameter connecting rent with variables that affect rents. A vacancy rate model and a rent model were constructed and compared using variables such as macroeconomic variables that appeared to affect vacancy rates and rents as explanatory variables.
As a result of the analysis, the vacancy rate model had high significance between the explanatory variable and the vacancy rate, and it was consistent with the office market theory, but the rent model had low significance with the explanatory variables and showed a different pattern from the theory. This result can be attributed to the fact that rent has not been adjusted even at a high vacancy rate level. However, since the 2008 financial crisis, effective rent has not been adjusted in the tenant's dominant market, but effective rent has not been able to be revealed due to limitations in data research, and all rent data distributed to the market has been written as asking rent. In the future, statistical survey policies and implementation measures that can appropriately reflect the commercial real estate market, including the office market, are required.