Land value variations in a CBD are the Land Users, whether they be retail, office, or residential. All compete for the most accessible land within the CBD. The amount they are willing to pay is called bid rent. This can generally be shown in a ‘bid rent curve’. Based upon the reasoning that the more accessible the land, generally in the center, is the more expensive land; this plan is called the bid rent theory plan.

Commerce (in particular large department stores/chain stores) is willing to pay the greatest rent to be located in the inner core. The inner core is very valuable for them because it is traditionally the most accessible location for a large population. This large population is essential for department stores, which require a considerable turnover. As a result, they are willing and able to pay a very high land rent value. They maximize the potential of their site by building many stories.

As you move from the inner core, the amount commerce is willing to pay declines rapidly. Industry, however, is willing to pay to be in the outer core. There is more land available for their factories, but they still have many of the benefits of the inner core, such as a market place and good communications.

As you move further out, the land is less attractive to industry due to the reducing communication links and a decreasing market place. This is because the householder does not rely heavily on these and can now afford the reduced costs (when compared with the inner and outer core) and is able to purchase land.

The further you go from the inner core and outer core, the cheaper the land. This is why inner city areas are very densely populated (terraces, flats and high rises), while the suburbs and rural areas are sparsely populated (semi and detached houses with gardens).