Source: adapted from R.L. Morrill. (1970) The Spatial Organization of Society.

Land Use Values and Activity Sectors

Land use value tends to vary according to the distance from the central business district (CBD). Therefore, for each activity sector; commercial, multi-family or single family residential, land costs increase with proximity to the city center and decrease if they are located farther away. The land costs are thus inversely proportional to distance from the CBD. As for the commercial sector, the value curve represents three peaks where values increase, while, generally, values diminish with distance from the city center. The curves for both residential sectors also follow a general trend towards lower values but in a less dramatic fashion for single family residences (almost a straight line stretching far from the center) while the curve for multi-family housing land follows a more pronounced curve. It is important to note that costs vary with distance and that demand functions (and rent) indicate a propensity for more commercial real estate in the center at the expense of residences. The contrary applies with distance from the center. Therefore, a commercial site situated outside the center would cost less but would yield correspondingly lower profitability.

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