Im currently doing an assignment where im implementing legal proposals that affects the valuations on commercial real estate on the Danish market. Im utilizing DCF valuations when doing so, but it would be nice to also do some statistics on top of the valuations to see which aspect within the legal proposals has the greatest impact. And because my Supervisor thinks it could be great with some more theory.

The problem is, that its many years since i had statistics and only on a very generel BSc level, where we only did Multiple linear regressions and im not sure this is the correct method. Ive discussed the matter with my supervisor, but his also a little novice within statistics as its not so important in his field of research.

At present i was thinking to do OLS as i've encountered this method in many researh papers and my Supervisor also thinks its the way to go.

I will shortly summarize my problem as i've envisioned it so far:

Dependent variable:

y = Value

Independent variables:

x1 = Whether a 5 year quarantine period has been applied: Dichotomous variable (Yes/no)

x2 = Cancelation of the quarantine periode through energi renovation: Categorical (No / Increase energi certificate by 3 levels / Spend 3.000 DKK on energi renovations)

x3 = Rent cant deviate by a margin of 10% from the legal level: Dichotomous variable (Yes/no)

x4 = Current energy certificate: Ordinal where one is omitted (A,B,C,D,E,F,G or 1,2,3,4,5,6,7)

x5 = Certain paragraph units cannot be modernized: Dichotomous (yes/no) - there are 4 different paragraph units: Cost driven, partly modernized, fully modernized and unregulated. This applies to the partly modernized that most likely cannot be fully modernized any more. And the goal for a owner is to fully modernize all units to maximize rent.

The goal of the legal proposal is to limit the scope of increasing rent levels through modernizing individual units. Therefore, whenever property changes ownership a quarantine period is encountered of 5 years before the new owner can modernize units and only if the energy certificate is at least C. This quarantine period can be cancelled by either increasing the energy certificate by 3 levels or my using 3000 DKK per gross sq. m. residential area.

Furthermore, that the rent cannot deviate my 10% applies to all methods.

I have therefore done DCF's on the properties as the rules are now and implemented the propsals for the properties by either quarantine periode or energy improvement to see which decreases the value the least. Furtheremore, i have have expensed and increased the energy certificate to C where applicable just to be able to modernize units.

I will therefore end up with around 7 valuations for each property: 1 orginal, 1 with 5 year quarantine, 1 with cancellation of quarantine, 2 with cancellation and quarantine and that rent cannot deviate on both, 2 with cancellation and quarantine where partly modernized units cannot be fully modernized and that the rent cannot deviate with 10%. The reason why the 2 last one is applied for independent (partly modernized cannot be fully modernized) is because there is high unceartainty about what is interpretated as partly modernized, so i might also omit these from the analysis.

I will furthermore analysize 30+ properties to see the effect on a diversifed portfolio of properties. Im also doing ordinary sensitivity analysis: Does the WACC have an effect on the effect of the proposal, what effect does churn have (properly alot since units can only be modernized when they are vacant) etc.

So basically any suggestions on an applicable statistical method would be highly appreciated and also suggestions for great litterature. I prefer litterature that also explain how to use a given software. When i had statistics we used Stata, but i have no preference as long as the litterature is great. My current state book looks a little basic though.

Really hope that i can be pointed in the righ direction!! And thanks in advance for any suggestions