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Article

Optimization of the Route Price Valuation Method for Commercial Land with Multiple Street Frontages—A Case Study of Quanzhou

by
Jiaxuan Chen
1,
Xiao Teng
1,2,*,
Zhenjiang Shen
3,
Chen Chen
4 and
Fang Wu
4
1
Graduate School of Environment Design, Kanazawa University, Kanazawa 920-1192, Japan
2
Cross-Strait Tsinghua Research Institute, Xiamen 361006, China
3
International Joint Laboratory of Spatial Planning and Sustainable Development (FZUKU-LAB SPSD), Fuzhou University, Fuzhou 350025, China
4
China Youke Communication Technology Co., Ltd., Fuzhou 350007, China
*
Author to whom correspondence should be addressed.
Urban Sci. 2025, 9(3), 77; https://doi.org/10.3390/urbansci9030077
Submission received: 9 December 2024 / Revised: 19 February 2025 / Accepted: 5 March 2025 / Published: 8 March 2025
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Abstract

:
The purpose of this paper is to analyze different valuation methods for commercial land with multiple street frontages to formulate a valuation method with the route price of main street frontage and sub-street frontage as the main valuation indicators. This paper is based on the route price valuation method of Quanzhou and Japan, through comparing and analyzing the valuation indicators and calculation formulas, it can be found that the differences between the two valuation methods for commercial land with multiple street frontages exist. In the case of Quanzhou, the valuation method only corrects the main street frontage route price, while the valuation method in Japan corrects the route price of each street frontage separately. As a result, according to the results of the comparative analysis, the current valuation method in Quanzhou is adjusted, and a valuation method is proposed that takes the route price of the main street frontage and sub-street frontage as the main valuation indicators. First, this research identifies the valuation indicators and calculation formulas related to multiple street frontages based on the documents related to the route price valuation methods of Quanzhou and Japan in order to clarify the current valuation methods and provide the foundation for the subsequent comparative analyses. Secondly, the comparative analysis of the different valuation methods for commercial land with multiple street frontages is based on the valuation indicators and calculation formulas. Among them, the current valuation method in Quanzhou corrects the main street frontage route price through the street frontage situation correction coefficient, whereas the valuation method in Japan corrects the route price of the main street frontage and sub-street frontage (side and back). Finally, according to the results of the comparative analysis and based on the current valuation method in Quanzhou, a valuation method is proposed with the route price of the main street frontage and sub-street frontage as the main valuation indicators.

1. Introduction

In 2013, China officially allowed the land use rights of rural collectively owned commercial construction land, which mainly includes commercial land, industrial land, and others, to be directly traded in the market [1,2,3]. This change has been in place for only a short period of time; the supporting policies and measures related to market entry are still in the exploration stage [4,5]. However, because of the incomplete valuation mechanism, the actual value of collectively owned commercial construction land has not been fully revealed, leading to the phenomenon of “same land, different price”, which affects the fair trade of land and restricts the realization of peasants’ property rights [6,7,8]. Therefore, for commercial land, as one of the main components of commercial construction land, exploration of and research on its valuation method is necessary and important.
The main valuation methods and technical standards for commercial land in China are based on Regulations for Valuation on Urban Land and the Technical Guidelines for the Valuation of Rural Collectively owned Land [9,10]. The main valuation approaches and technical points of valuation are clarified in these two documents, which indicate that the market comparison approach is suitable for the assessment of commercial land. Thus, the route price valuation method, as a derivative of the market comparison approach, is adopted in many regions as one of the main valuation methods for commercial land. For example, the Quanzhou Municipal Bureau of Planning and Natural Resources proposed in the Application Plan for the New Round of Revision of Urban Benchmark Land Prices in the Central Urban Area of Quanzhou, promulgated in 2021, that the route price valuation method is applicable to commercial land with a street frontage depth of 25 m or less [11]. The basic principle of the route price valuation method is that for the land along the same street, the land price decreases as the depth of street frontage increases [12]. And lands with the same street frontage depth will have different land prices due to differences in other valuation indicators.
The route price valuation method was initially applied in Occidental countries for taxation, then adopted by many countries as one of the basic methods of land valuation [13]. Over the years, route price valuation methods have been roughly divided into the Occidental system represented by the United States and China–Japan system [14]. The principles underlying the two systems are the same, which is to divide land parcels of equal accessibility into the same route price zone; and within the same zone, land parcels will also have different usability due to factors such as depth, width, and size, etc., so further corrections based on each correction coefficients are required to derive a reasonable land price for each land parcel [15]. However, the main differences between the two systems are the expression of route price and the calculation mode of the depth correction coefficient. In the expression of the route price, the commonly used standard unit in the Occidental system is 1 foot wide and 100 feet deep, so the route price indicates the total price of a standard plot of land [16,17]; in the China–Japan system, the route price is expressed in units of average per square meter [18]. In the calculation mode of the depth correction coefficient, the Occidental system adopts the principle of cumulative depth percentage, such that the overall trend is that the depth coefficient increases with increasing depth [19]; the China–Japan system is calculated based on the principle of average depth percentage, so the overall trend is that the depth correction coefficient gradually decreases with increasing depth [20]. In addition, the comparison of the main factors shows that the focus of the route price valuation methods for each country is different (as shown in Table 1). Among them, the correction in the United States is relatively simple, only based on the shape of the land to correct the route price, while Japan focuses on the correction of specific land locations, and China comprehensively considers from multiple perspectives.
The route price valuation method was first introduced in the 1950 amendment to the Inheritance Tax Act as one of the land valuation methods in Japan [23]. This was because the townscape had changed considerably during the period of land reorganization and post-war reconstruction, which made the original rent multiplier method of land valuation no longer applicable [24,25]. The route prices are set by the National Tax Agency in accordance with the Inheritance Tax Act, and the road prices for major roads nationwide are announced on 1 January every year. The assessment of the route price is based on land transaction data within the past year, which is assessed and adjusted by experts to ensure its accuracy and fairness. Moreover, the National Tax Agency has issued two documents, General Guidelines for Property Valuation and Standards for Property Evaluation, which together structure the current route price valuation method [26,27]. Among them, the General Guidelines for Property Valuation sets out the detailed definitions of the route price and various valuation indicators involved in the route price valuation method, in which the scope of application includes commercial land. The National Tax Agency annually updates the Standards for Property Evaluation, which specifies standards for route prices and valuation indicators, as well as the Detailed Statement of Valuation for Land and Rights Attached to Land, which provides the calculation formulas for the route price valuation method [28]. The route price valuation method has been developed in Japan over many years, and the annual updating of valuation indicators and calculation formulas ensures its applicability in practice [29]. In addition, there are significant differences between China and Japan in terms of land ownership regimes, land systems, and market maturity, and these differences directly affect their respective valuation techniques [30,31,32,33,34]. In terms of land ownership regimes and land systems, Japan implements the land system based on private ownership, which means that land ownership belongs to individuals or legal persons, and the clear property boundaries and rights provide legal protection for land transactions [35,36,37,38]. Under private ownership of land, land can be freely traded as a commodity, and this freedom promotes the liquidity of the land market [39,40,41]. The increased frequency of transactions has made land prices more reflective of market supply and demand, which has created an effective price signal [42,43,44,45]. Therefore, the private ownership model supports a highly transparent and mature land market. The land ownership system in China is divided into state-owned urban land and farmer-collective-owned rural land, such that individuals and other entities can only be granted land use rights for a specific period [46,47,48]. This dual structure has led to complications in the granting and transfer of land use rights due to different practices among administrative regulations and local governments [49,50]. As a result, the development and improvement of the land market is restricted [51]. In terms of market maturity, Japan has a high degree of market maturity, which is characterized by transparent transactions, well-developed data systems, and extensive financial instruments related to land [52,53,54]. For example, the Japanese government uses the Japan Residential Property Price Index, Land General Information System, and other methods to visually display price trends for various land uses, actual land transaction prices, land price announcements, etc., which allows for high accessibility and availability of the various data [55,56]. The market maturity ensures that the route price valuation method is based on extensive empirical data, which in turn helps to make accurate and reliable evaluations [57]. In contrast, the land market in China is still developing. Although significant marketization progress has been made since the 1990s, the development of the land market is still limited by issues such as unclear property rights, speculative activities by real estate companies, and inconsistent data quality [58,59,60,61,62]. These challenges hinder the effectiveness of the route price valuation method due to the fact that the land market price may not fully reflect the actual land price [63,64].
The similarities between China and Japan in the current route price valuation methods provide the basis for international comparisons, in particular the consistency in the principles of route price expression and depth correction coefficient calculation. Although China focuses on the valuation of land use rights, while Japan favors land ownership, it is also able to value land use rights, so the analysis and comparison of valuation methods are feasible [65,66,67,68]. According to previous research, most of the relevant literature focuses on the issues for the practical application of the route price valuation method, such as land readjustment, small- and medium-sized towns, commercial land benchmark price assessment, and commercial demolition [69,70,71,72,73]. These articles are based on practical issues and aim to improve the accuracy of the valuation by incorporating correction factors such as land use intensity, location conditions, and unit area rent into the valuation model to complement the deficiencies of the route price and existing correction factors in practical applications. While the effect of sub-street frontage on land prices is mentioned in some of the literature, it is only as part of the correction coefficient and not the focus of the research. In addition, there is also some literature that tends to analyze the valuation theory of the route price valuation method, which includes the clarification of the concept of route price and the route price valuation method, as well as the formulation method of each correction coefficient table [12,74,75,76,77,78,79]. Compared with previous literature, this research is based on evaluation theory and emphasizes the joint impact of main and sub-street frontage route prices on land value in the case of multiple street frontages. Moreover, the proposed evaluation method supplements existing research by using the route price of the main and sub-street frontages as the main evaluation indicators.

2. Methodology

The purpose of this research is to improve the applicability of the current route price valuation method for commercial land with multiple street frontages by comparing and analyzing the route price valuation methods of China and Japan, and propose a valuation method with the route price of the main and sub-street frontages as the main valuation indicators (as shown in Table 2 and Figure 1). This study focuses on the research question that the current route price valuation method in Quanzhou cannot reflect the impact of sub-street frontage on land value. Based on this, the hypothesis is that using the main and sub-street frontage road prices as main valuation indicators can reduce valuation errors when assessing commercial land with multiple street frontages.
Firstly, document analysis is used to analyze the relevant documents for the Quanzhou and Japan route price evaluation methods. The objective of this method is to sort out relevant documents to extract valuation indicators and calculation formulas. The expected outcome is clarification of the key valuation indicators and calculation formulas of the China–Japan route price valuation method, which provides a foundation for comparative analysis.
Then, the current route price valuation methods in China and Japan are compared through the comparative analysis method. The objective of this method is to compare the calculation formulas and valuation indicators, and the expected outcome is highlighting the main differences, especially the main and sub-street frontage-related valuation indicators.
Moreover, according to the results of the comparative analysis, an adjustment of the current road price valuation method in Quanzhou is proposed. The revised method emphasizes using the road prices of main and sub-street frontages as the main evaluation indicators, by which the expected outcome can better reflect the land value of commercial land with multiple street frontages.
Finally, to verify the effectiveness of the adjusted evaluation method, a case study is conducted based on a real commercial land in Quanzhou. By comparing the current valuation method with the adjusted valuation method in actual cases to determine which method closer to actual land market price, the expected outcome is that the adjusted method reduces the valuation error due to insufficient consideration of the sub-street influence.

3. Valuation Methods for Commercial Land with Multiple Street Frontages in China and Japan

3.1. China’s Route Price Valuation Method—Taking Quanzhou as an Example

3.1.1. Calculation Formula for China’s Route Price Valuation Method

According to the route price valuation method, related documents in Quanzhou can determine the following calculation formula in the case of multiple street frontages [11]:
Total land value = [(Main street frontage route price a × Street frontage depth correction coefficient b × Street frontage condition correction coefficient) × Other correction coefficients c + Other correction value d] × Land area
  • a Main street frontage route price: the highest route price of all street frontages;
  • b Street frontage depth correction coefficient: the impact of street frontage depth on route price;
  • c Other correction coefficients: includes street frontage width correction coefficient, Building floor correction coefficient, Land use period correction coefficient, valuation date correction coefficient, and micro-location correction coefficient, which are not discussed in this research;
  • d Other correction value: refers to the development degree correction value, which is not discussed in this research.
From the above formula, the key points of the valuation of commercial land with multiple street frontages in Quanzhou are the selection of the main street frontage and how to reflect the impact of multiple street frontages on the land value.
Firstly, the current calculation formula in Quanzhou is based on the main street frontage route price for valuation, so the selection of the main street frontage has a large impact on the valuation results. In the case of multiple street frontages, the highest route price of all street frontages is used as the main street frontage. In addition, the current calculation formula only corrects for the main street frontage route prices, and the other street frontage route prices are not directly involved in the valuation calculations.
For the impact of multiple street frontages on land value, the current formula is realized through the street frontage depth correction coefficient and the street frontage condition correction coefficient. In particular, the street frontage depth correction coefficient refers to the impact of the main street frontage depth on the land value, while the street frontage condition correction coefficient reflects the impact of other street frontages on the land value.
Therefore, the calculation formula in Quanzhou emphasizes the correction of the main street frontage, reflecting the impact of multiple street frontages on the main street frontage route price through the street frontage condition correction coefficient.

3.1.2. Valuation Indicators for China’s Route Price Valuation Method

The detailed valuation indicators are shown in Table 3, and the valuation indicators related to multiple street frontages include the main street frontage route price, street frontage depth correction coefficient, and street frontage condition correction coefficient. In order to facilitate better analysis, the valuation indicators are divided into main street frontage and sub-street frontage (side and back) based on the influencing factors so as to clarify how the current valuation method reflects the impact of multiple street frontages on the land value.
In particular, the main street frontage route price and the street frontage depth correction coefficient are related to the main street frontage. The main street frontage route price is the core of the current valuation method, and the remaining correction coefficients are corrections to the main street frontage route price. The street frontage depth correction coefficient is intended to reflect the relationship between the depth of the main street frontage and the degree of change in land value.
The relevant valuation coefficient for the sub-street frontage is the street frontage condition correction coefficient. The influencing factor is the total number of street frontages, which means that the current valuation method judges the impact on land value only by the total number of street frontages in the case of multiple street frontages. Therefore, the current valuation indicators in Quanzhou reflect the impact of multiple street frontages on land value through the street frontage condition correction coefficient based on the total number of street frontages.

3.2. Route Price Valuation Method in Japan

3.2.1. Calculation Formula for Japan’s Route Price Valuation Method

According to documents related to the route price valuation method in Japan, it can be determined that the calculation formula in the case of multi-facing streets is as follows [26,27,28]:
Total land value = [(Front route price a × Depth price correction rate b) + (Side/back route price c × Depth price correction rate b × Side/back route impact plus rate d)] × Other correc-tion rates e × Land area
  • a Front route price: the highest corrected value for all street frontages (Route price × Site frontage depth correction coefficient), which is the main street frontage;
  • b Depth price correction rate: the impact of street frontage depth on route price;
  • c Side/back route price: classify the street frontage other than the main street frontage as either side or back, depending on its location relationship to the main street frontage;
  • d Side/back route impact plus rate: further corrections to side/back route prices based on street layout (Corner lot/quasi-corner lot/double-frontage lot), assessed and issued by the National Tax Agency, which is affected by the land use classification and the relationship of the road location;
  • e Other correction rates: includes the narrow frontage correction rate, land shape irregularity correction rate, depth-length correction rate, steep slope correction rate, and special alert area correction rate, which are not discussed in this research.
In Japan, the main street frontage is selected by comparing the route price of each street frontage multiplied by the depth price correction rate, and the highest one is selected as the main street frontage.
After determining the main street frontage, the other street frontages are classified as either side or back based on their location in relation to the main street frontage and are further corrected by the side or back route impact plus rate. In addition, when the land has three or more street frontages, it is necessary to correct the route price of each street frontage separately.
This means that the valuation method in Japan is based on a correction for each street frontage. The main street frontage route prices are corrected and then added to the correction results of the side or back route prices to reflect the impact of multiple street frontages on land values.

3.2.2. Valuation Indicators for Japan’s Route Price Valuation Method

The detailed valuation indicators are shown in Table 4; the multiple-street-frontages-related correction rates include front route price, side or back route price, Depth price correction rate, and side or back route impact plus rate.
The valuation indicators related to the main street frontage are the front road price and the Depth price correction rate. The relationship between the depth of the street frontage and the degree of change in land value is reflected through the Depth price correction rate after identifying the front route price.
Meanwhile, side or back route price, depth price correction rate, and side or back route impact plus rate are related to the sub-street frontage. After reflecting the relationship between the depth of the street frontage and the degree of change in land value through the depth price correction rate for the side or back route prices, it is further corrected through the side or back route impact plus rate. In particular, the side or back route impact plus rate is based on the street layout, including corner lot, quasi-corner lot, and double-frontage lot, reflecting the impact of the sub-street frontage on land values.

4. Comparison of the Differences in Valuation Methods for Commercial Land with Multiple Street Frontages

4.1. Comparison of Route Price Valuation Method Calculation Formulas in Quanzhou and Japan

According to an analysis of the valuation methods of commercial land with multiple street frontages in Quanzhou and Japan, it can be seen that the differences between the two calculation formulas mainly lie in the selection of the main street frontage and how to reflect the impact of multiple street frontages (as shown in Figure 2).
For the selection of the main street frontage, Quanzhou takes the highest route price among the street frontages as the main street frontage, while Japan compares the value of the route price multiplied by the depth price correction rate and takes the highest one as the main street frontage. Because the route price serves as an average price for standard lots on the road, only comparing the route price and ignoring the effect of the depth is disassociated from the actual land situation, which cannot effectively determine the highest-value street frontage. Therefore, comparing the value of the route price multiplied by the depth price correction rate is more effective in selecting the highest-value street frontage as the main street frontage based on the actual land situation.
Secondly, for reflecting the impact of multiple street frontages, Quanzhou’s current calculation formula is based on the main street frontage route price, which is multiplied by the street frontage depth correction coefficient and through the street frontage condition correction coefficient to reflect the impact of multiple street frontages on the land value. In Japan, the main and the sub-street frontage (side or back) route prices are corrected by the depth price correction rate, and further corrections are made to the sub-street frontage route price, and the corrected results are finally added together to reflect the impact of multiple street frontages on the land value. Therefore, the calculation method of correcting and adding up the main and sub-street frontage route prices separately is more effective in reflecting the impact of each street frontage on the land value in the case of multiple street frontages.

4.2. Comparison of Route Price Valuation Method Valuation Indicators in Quanzhou and Japan

According to the above analysis of the current valuation indicators in Quanzhou and Japan, it can be found that the indicators related to sub-street frontage are quite different (as shown in Figure 3).
Firstly, for the valuation indicators related to the main street frontage, Quanzhou and Japan’s current valuation indicators are relatively consistent. Both are corrected for the main street frontage route price by the street frontage depth correction coefficient/depth price correction rate. Since the street frontage depth correction coefficient and the depth price correction rate are based on the depth of the street frontage reflecting the relationship between depth and the degree of land value change, they are the same indicator with different names.
Secondly, for the valuation indicators related to the sub-street frontage, Quanzhou only corrects the main street frontage route price by the street frontage condition correction coefficient; the only influencing factor is the total number of street frontages, which cannot effectively reflect the difference in the influence of each street frontage on the land value; on the other hand, the sub-street frontage route price in Japan is corrected by the depth price correction rate and the side and back route impact plus rate of each frontage separately. Therefore, compared to correcting the main street frontage route price only by the street frontage condition correction coefficient, it is more effective to correct the sub-street frontage route price from the perspective of the street layout and depth by using the side and back route impact plus rate and the depth price correction rate, which can help to reflect the impact of the sub-street frontage on the land value in the case of multiple street frontages.

5. Adjustments to the Valuation Method for Commercial Land with Multiple Street Frontages

According to the comparison results mentioned above, the current valuation method in Quanzhou is used as the foundation for adjustment, so as to propose the valuation method with main street frontage route price and sub-street frontage route price as the main valuation indicators. The adjustments to the calculation formula and valuation indicators can be divided into three parts.
Firstly, the main street frontage selection method is adjusted from only comparing the route price of each street frontage to comparing the result of the route price multiplied by street frontage depth correction coefficient, thus helping to select the highest-value street frontage as the main street frontage.
In terms of the calculation formula, it has been adjusted from only correcting the main street frontage route prices to correcting the main and sub-street frontage routes separately and adding up the results, to achieve the joint participation of the main and sub-street frontage route prices in the valuation of multiple street frontages.
In terms of valuation indicators, the sub-street route price is introduced based on the adjustment of the calculation formula. Secondly, the street frontage condition correction coefficient, in which the influencing factor is the total number of street frontages, is replaced by the sub-street frontage impact plus rate to achieve the correction of the route price from the perspective of the sub-street layout so as to reflect the specific influence of each street frontage on the land value.
The adjusted calculation formula and valuation indicators are shown in Figure 4. In general, the proposed adjustment of the calculation formula and valuation indicators has two main effects on the real-world valuation. The first is the distinction between the main and sub-street frontages. Compared with the current valuation method of only comparing the route price, the adjustment emphasizes that comparing the value of route price multiplied by the street frontage correction coefficient can more effectively select the street frontage with the highest value as the main street frontage, avoiding incorrect selection due to the lack of consideration of the impact of depth. The second is the reflection of the impact of sub-street frontage. Compared with the current valuation method, which is only based on a correction coefficient, the adjustment brings the sub-street frontage route price into the calculation formula, so that its correction can more accurately reflect the impact of sub-street frontage on land value.

6. Case Study—One Commercial Land Parcel in Quanzhou

To further clarify the application of the adjusted valuation method in practice, Li-2023—No. 17 Parcel is taken as an example (as shown in Figure 5), and the current valuation method and the adjusted valuation method are used to estimate the price and then compared with the actual land market price [11,80,81].

6.1. Current Route Price Valuation Method in Quanzhou

Firstly, the highest route price among the three street frontages is selected, which is Meishi street, with the route price of 14,500 RMB/m2.
Then, the calculation formula of Quanzhou’s current route price valuation method is combined with the relevant data of the Li-2023—No. 17 Parcel to calculate the land value. The result is CNY 108,509,184, and the difference compared to the land market price is CNY 54,908,160. The specific calculation formula and process are as follows.
Calculation formula: Total land value = [(Main street frontage route price × Street frontage depth correction coefficient × Street frontage condition correction coefficient) × Other correction coefficients + Other correction value] × Land area
Calculation process: 108,509,184 = [(14,500 × 0.8 × 1.16) × (1.12 × 1 × 1 × 1 × 1) + 0] × 7200

6.2. Adjusted Route Price Valuation Method

Firstly, the maximum of the route price multiplied by the street frontage depth correction coefficient is used for the main street frontage. Specifically, Planning street has a value of 12,716 (14,450 × 0.88), Meishi Street has a value of 11,600 (14,500 × 0.8), and Wenling North Road has a value of 11,520 (14,400 × 0.8). Planning street has the highest value after correction, so it is used as the main street frontage.
Then, the adjusted calculation formula is combined with the relevant data of the Li-2023—No. 17 Parcel to calculate the land value. The result is approx. CNY 117,456,998.4, and the difference from the land market price is CNY 34,569,984.00. The specific calculation formula and process are as follows.
Calculation formula: Total land value = {[(Main street frontage route price × Street frontage depth correction coefficient) + (Sub-street frontage route price × Street frontage depth correction coefficient × Sub-street frontage impact plus rate)] × Other corrective co-efficients+ Other correction values} × Land area
Calculation process: 117,456,998.4 = {[(14,450 × 0.88) + (14,400 × 0.8 × 0.08) + (14,500 × 0.8 × 0.08)] × (1.12 × 1 × 1 × 1 × 1) + 0} × 7200

6.3. Land Valuation Comparison

A comparison of the practical application of Quanzhou’s current valuation method and the adjusted valuation method shows that the adjusted valuation method is closer to the market price of land, which reduces the error of the current valuation method (as shown in Figure 6). The detailed data from the two methods can be compared to find that the choice of the main street frontage is the primary reason for the difference in valuation results. In addition, because the route prices of each street frontage in this case are similar, the two methods have different ways to calculate the impact of sub-street frontages, but the results are similar. Therefore, it can be clarified that the adjusted valuation method can help to choose the main street frontage with the highest value in the case of multiple street frontages, thus effectively distinguishing between the main and sub-street frontages. Moreover, bringing the sub-street frontage route price into the calculation process can directly reflect the impact on land value based on its route price, avoiding errors due to the large difference between the main and sub-street frontage route prices. Meanwhile, the adjusted valuation method can have a positive impact on multiple parties in practical applications. For example, the valuation results are closer to the current land market price, which can help landowners realize their land profit rights, thus avoiding the loss of profit due to the valuation; accurate differentiation of main and sub-street frontages can provide a more scientific and reasonable basis for assessment organizations and the government, which enhances the credibility of the valuation results.
Meanwhile, the adjusted formula and valuation indicators also have potential limitations. Firstly, the adjusted valuation method has not been adapted to local policies and regulations, so there are inconsistencies between it and local regulations in actual application. Therefore, in future research, it is necessary to localize the adjusted evaluation method in combination with local regulations and policies [82,83,84]. In addition, the adjusted valuation indicators have insufficient and inaccurate required data, so the valuation indicators need to be calculated and calibrated. Future research can be based on land use, road capacity, commercial activities, traffic flow density, and other indicators through data analysis techniques such as geographic information systems (GISs) to provide more accurate measurements of the required valuation indicators [85,86,87,88,89].

7. Conclusions

This research compares the current route price valuation methods in China and Japan, taking Quanzhou as an example, through analysis of the differences in valuation methods for commercial land with multiple street frontages, to propose a valuation method that takes the route price of the main and sub-street frontages as the main valuation indicators.
Currently, there is some enhancement space for the application of Quanzhou’s route price valuation method in the case of commercial land use with multiple street frontages. Firstly, Quanzhou only compares the route price of each street frontage when choosing the main street frontage and ignores the effect of depth, which makes the selected main street frontage not certainly suitable for the land. Secondly, the current valuation method in Quanzhou only corrects for the main street frontage route price, which does not effectively reflect the impact of multiple street frontages on land value. Moreover, the valuation indicators in Quanzhou only correct the main street frontage route price based on the total number of street frontages through the street frontage condition correction coefficient, which does not validly reflect the specific impacts of each street frontage.
In order to make practical suggestions based on the current valuation methods, this research compares and analyzes the differences in valuation methods between Quanzhou and Japan in the case of commercial land with multiple street frontages, as well as adjusts and proposes the valuation method that takes the main and sub-street frontage route prices as the main valuation indicators.
Firstly, the selection of the main street frontage by selecting the route price multiplied by the street depth correction coefficient of the highest result side as the main street frontage is utilized to effectively select the highest-value street frontage based on the actual land situation.
Secondly, the adjusted calculation formula corrects the main and sub-street frontage route prices separately and adds up the results. Compared with the current calculation formula in Quanzhou, which only corrects the main street frontage route price, the way of correcting separately can more intuitively reflect the impact of the sub-street frontage on the land value in the case of commercial land with multiple street frontages.
In terms of valuation indicators, the sub-street route price has been introduced based on the adjustment of the calculation formula, and the sub-street route impact plus rate has been adopted to replace the street frontage condition correction coefficient in order to correct the sub-street route price from the perspective of street layout, thereby reflecting the specific impact of each street frontage on the land value.
The adjusted valuation method based on the above optimization measures can be compared with Quanzhou’s current valuation method through the case study of Li-2023—No. 17 Parcel to clarify its practical implications. Firstly, the adjusted valuation method comprehensively considers each street frontage route price and its depth, avoiding the problem of incorrectly selecting the main street frontage in the current valuation method due to only considering the route price. It provides a more scientific and reasonable basis for valuation agencies and the government when conducting land valuation, thereby improving the credibility of the valuation results. Meanwhile, the adjusted valuation method has effectively reduced the error with the land market price, avoiding situations in which the landowner’s profit is damaged due to the valuation. In addition, the adjusted valuation method still has certain potential limitations, such as the fact that the adjusted valuation method does not make adaptations based on local policies and regulations, so there are inconsistencies between it and local regulations in actual application. Therefore, in future research, it is necessary to localize the adjusted evaluation method in combination with local regulations and policies. Moreover, the adjusted valuation indicators have insufficient and inaccurate required data, so valuation indicators need to be calculated and calibrated. Future research can be based on land use, road capacity, commercial activities, traffic flow density, and other indicators through data analysis techniques such as geographic information systems (GISs) to provide more accurate measurements of the required valuation indicators.

Author Contributions

Conceptualization, X.T. and Z.S.; Methodology, Z.S.; Software, X.T.; Validation, X.T.; Formal analysis, X.T.; Investigation, J.C., C.C. and F.W.; Resources, X.T.; Data curation, J.C.; Writing—original draft preparation, J.C.; Writing—review and editing, J.C. and X.T.; Visualization, X.T.; Supervision, Z.S.; Project administration, X.T. and Z.S.; Funding acquisition, X.T. All authors have read and agreed to the published version of the manuscript.

Funding

This research was supported by the Quanzhou Municipal Planning and Natural Resources Bureau under the project ‘Thematic Research on the Entry of Rural Collectively-owned Commercial Construction Land into the Market in Quanzhou’ (Grant Number: [350501]QYCG[CS]202300325). And The APC was funded by Xiao Teng.

Data Availability Statement

The original contributions presented in this study are included in the article.

Conflicts of Interest

Author Chen Chen and Fang Wu were employed by the company China Youke Communication Technology Co., Ltd. The remaining authors declare that the research was conducted in the absence of any commercial or financial relationships that could be construed as a potential conflict of interest.

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Urbansci 09 00077 g001
Figure 1. Research road map.
Figure 1. Research road map.
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Figure 2. Comparative analysis of calculation formulas.
Figure 2. Comparative analysis of calculation formulas.
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Figure 3. Comparative analysis of valuation indicators.
Figure 3. Comparative analysis of valuation indicators.
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Figure 4. The adjusted calculation formula and valuation indicators.
Figure 4. The adjusted calculation formula and valuation indicators.
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Figure 5. Li-2023—No. 17 Parcel details and location map.
Figure 5. Li-2023—No. 17 Parcel details and location map.
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Figure 6. The deviation rate between the adjusted valuation method and the current valuation method with the land market price.
Figure 6. The deviation rate between the adjusted valuation method and the current valuation method with the land market price.
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Table 1. Comparison of route price valuation methods’ main factors in China, Japan, and the United States [11,21,22,23].
Table 1. Comparison of route price valuation methods’ main factors in China, Japan, and the United States [11,21,22,23].
ChinaJapanThe United States
Route priceRoute priceRoute price
DepthDepthDepth
WidthWidthWidth
Total number of street frontagesSub-street (Side/back)Land shape
Land use periodCorner lot/quasi-corner lot/double-frontage lot
Valuation dateLand shape
Micro-locationNarrow frontage
Development degreeSteep slope
Table 2. Summary table of methodological steps.
Table 2. Summary table of methodological steps.
StepResearch ObjectiveExpected Outcome
Document analysisAnalyze relevant documents to identify current evaluation methodsIdentify key indicators and calculation formulas
Comparative analysisCompare valuation indicators and calculation methods related to multiple street frontagesHighlight method differences
Method adjustmentAdjust the current valuation method in Quanzhou based on the comparison resultsDevelop an adjusted valuation method
Case studyApply both methods to a practical case and compare the resultsAdjustments can effectively reduce valuation errors
Source: Self-drawn by the author.
Table 3. Valuation indicators for route price valuation method in Quanzhou.
Table 3. Valuation indicators for route price valuation method in Quanzhou.
Valuation IndicatorsInfluencing Factors a
Main street frontage route priceRoute price b
Street frontage depth correction coefficientDepth c
Street frontage condition correction coefficientTotal number of street frontages d
Other correction coefficients e/
Other correction value f/
Source: Self-drawn by the author based on the Application Plan for the New Round of Revision of Urban Benchmark Land Prices in the Central Urban Area of Quanzhou; a Influencing factors: factors that can influence the correction coefficient as identified based on the correction coefficient table and coefficient calculation process; b Route price: evaluated and published by the Bureau of Planning and Natural Resources and/or agencies based on examples of land transactions recent years, with the standard unit of RMB/m2; c Depth: the distance measured along the direction perpendicular to the main street frontage to the back boundary of the land, where if the land shape is irregular, the average depth distance is calculated, i.e., land area ÷ street frontage width; d Total number of street frontages: the total number of street frontages, which can be obtained directly from the relevant material documents or surveys; e Other correction coefficients: includes street frontage width correction coefficient, Building floor correction coefficient, Land use period correction coefficient, Valuation date correction coefficient, and Micro-location correction coefficient, which are not discussed in this research; f Other correction value: development degree correction value, which is not discussed in this research.
Table 4. Valuation indicators for route price valuation method in Japan.
Table 4. Valuation indicators for route price valuation method in Japan.
Valuation IndicatorsInfluencing Factors a
Front (main street frontage) route priceRoute price b, depth c
Side/back (sub-street frontage) route priceSide/back
Depth price correction rateDepth c
Side/Back route impact plus rateCorner lot d/quasi-corner lot e/double-frontage lot f
Other correction rates g/
Source: Self-drawn by the author based on the Detailed Statement of Valuation for Land and Rights Attached to Land; a Influencing factors: factors that can influence the correction coefficient as identified based on the correction coefficient table and coefficient calculation process; b Route price: evaluated based on land transaction data from the previous year and published annually by the National Tax Agency, with the standard unit of JPY/m2; c Depth: he distance measured along the direction perpendicular to the main street frontage to the back boundary of the land, where if the land shape is irregular, the average depth distance is calculated, i.e., land area ÷ street frontage width; d Corner lot: a lot at the corner of an intersection or thruway formed by two roads; e Quasi-corner lot: a lot at the corner of an L-shape formed by one road; f Double-frontage lot: a lot having frontage on two non-intersecting roads; g Other correction rates: includes the narrow frontage correction rate, land shape irregularity correction rate, depth-length correction rate, steep slope correction rate, and special alert area correction rate, which are not discussed in this research.
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Chen, J.; Teng, X.; Shen, Z.; Chen, C.; Wu, F. Optimization of the Route Price Valuation Method for Commercial Land with Multiple Street Frontages—A Case Study of Quanzhou. Urban Sci. 2025, 9, 77. https://doi.org/10.3390/urbansci9030077

AMA Style

Chen J, Teng X, Shen Z, Chen C, Wu F. Optimization of the Route Price Valuation Method for Commercial Land with Multiple Street Frontages—A Case Study of Quanzhou. Urban Science. 2025; 9(3):77. https://doi.org/10.3390/urbansci9030077

Chicago/Turabian Style

Chen, Jiaxuan, Xiao Teng, Zhenjiang Shen, Chen Chen, and Fang Wu. 2025. "Optimization of the Route Price Valuation Method for Commercial Land with Multiple Street Frontages—A Case Study of Quanzhou" Urban Science 9, no. 3: 77. https://doi.org/10.3390/urbansci9030077

APA Style

Chen, J., Teng, X., Shen, Z., Chen, C., & Wu, F. (2025). Optimization of the Route Price Valuation Method for Commercial Land with Multiple Street Frontages—A Case Study of Quanzhou. Urban Science, 9(3), 77. https://doi.org/10.3390/urbansci9030077

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