Effects of Commercial Gentrification on Land Prices in Seoul, Republic of Korea

Commercial gentrification illustrates changes in urban economic activities, residential patterns and spatial structure. The gentrification, which refers to the upgrade of commercial activities representing small businesses in underdeveloped areas are replaced by large stores, has been paid attention in urban studies and real estate fields due to its economic, social and physical effects. Despite the importance of commercial gentrification, there have been few sophisticated measurements and impact analyses for commercial gentrification. This study measured commercial gentrification in Seoul with the expectation-based index and analyzed its effects through residential and non-residential land prices. The analysis with multi-level regression and geographically weighted regression models revealed that the progression and volatility of commercial gentrification had both positive and negative effects on residential and non-residential land prices by regions. Furthermore, the effects were relatively greater on residential land prices than on non-residential land prices. The key findings of this study will improve the understanding of commercial gentrification and serve as a foundation for decision-making of public and private sectors in relation to commercial gentrification.