Estimating the Effect of Sports Facilities on Local Area Commercial Rents: Evidence From Brooklyn’s Barclays Center

Abstract

The effect of Brooklyn’s Barclays Center on commercial land rents is estimated on a pooled cross-section of parcels within 1 mile of the arena from 2006 through 2015. The effect of the arena is isolated using a triple difference-in-difference approach. From the preferred model, net operating income per square foot is estimated to fall by an average of 3.7% for each 1,000 feet away a commercial parcel is removed from the arena. The average rent effect within 1 mile of the arena is further estimated to be US$2.71 per square foot. The implications of the findings are discussed.