IMF Christine Lagarde on Women’s Empowerment: An Economic Game Changer

International Monetary Fund | Christine Lagarde | November 14, 2016 | Los Angeles

Christine Lagarde, the Managing Director of the International Monetary Fund since July 2011, recently spoke in Los Angeles on the current and future states of women empowerment.  The International Monetary Fund, IMF, formed in 1944, is an international organization headquartered in Washington, D.C. composed of 189 countries whose goal is “to foster global monetary cooperation, secure financial stability, facilitate international trade, promote high employment and sustainable economic growth, and reduce poverty around the world.”

Here are excepts from her Christine Lagarde’s speech:

Your energy and commitment are what we need in a world that still has many obstacles for women and girls to achieve their full potential, and where gender discrimination is still an issue that we have to deal with.

No doubt, we have already come a long way. In education, we have seen impressive declines in gender gaps around the world. In colleges, women are catching up in science and math, and businesses are realizing that a more diverse workforce adds a lot of shareholder value.

And of course, having women in leadership positions—in business and public office—is a powerful signal for both men and women. Just think of the role Chancellor Merkel is playing in Europe, for example, or the inspiring example of Aung San Suu-Kyi in Myanmar.

We certainly need more women who can raise awareness and lead by example.

Of course, the IMF has been promoting fundamental change for more than 70 years. We provide financial assistance to countries in need and help them get back on their feet. We assess the economic health of all our members and provide them with recommendations on economic policies.

With all these issues on our plate, why do we care so deeply about gender? Not just because it is a moral issue, but because gender equality is critical for the economic well-being of both men and women, of society as a whole.

We know—based on a wealth of research and experience—that empowering women can be an economic game changer for any country. For instance, if women were to participate in the labor force to the same extent as men, national income could increase by 5 percent in the U.S., 9 percent in Japan, and 27 percent in India.

Equal pay and better economic opportunities for women boost economic growth—creating a bigger pie for everyone to share, women and men alike. Better opportunities for women also promote diversity and reduce economic inequality around the world. It is an economic no-brainer.

Across the globe, women are still facing a triple-disadvantage. They are less likely than men to have a paid job—in fact, only half of the world’s working-age women are employed.  If they do find paid employment, it is more likely to be in the informal sector. And if they eventually get a job in the formal sector, they earn, on average, three-quarters as much as men—even with the same level of education, and in the same occupation.

Here in California, for example, in Hollywood, we know that even top female actors earn significantly less than their male counterparts. We also know that some of the hottest tech startups have yet to understand that giving women a fair shot is good for innovation and good for business.

But before I move on to what we can do, let us not forget that far too many women are still fighting for basic human rights—including safety, health, and liberty.

We also need to push for smarter tax policies, including here in the United States.

So if you add up all things that can be done in each country, you get a powerful global impact. A global economic game changer.

The good news is that the most important countries have understood the need for gender equality—and that includes a group of leading economies—known as the G-20—that account for 85 per cent of world GDP and two-thirds of its population.

These countries—including the U.S.—have pledged to reduce the gap in women’s labor force participation by 25 percent by the year 2025—which would create an estimated 100 million more jobs by 2025. This would be a huge impetus to growth and would reduce poverty and inequality.

This objective is critical, and yet – even in the most progressive countries, progress towards gender equality has been painfully slow.

A good example is Iceland, which elected its first female president long ago, in 1980—and yet women still earn 14‑18 percent less than men. In protest over that pay gap, thousands of Icelandic women recently left their workplaces at exactly 2:38 pm—because they are effectively not being paid for the rest of the day. We saw a similar protest in France last week—and for good reason.

New research shows that global efforts to close the gender gaps in pay and labor force participation have slowed so dramatically over the past year, that full economic equality may not be reached for another 170 years.

Are you prepared to wait until 2186? Certainly not! Your generation has the opportunity—and the power—to bend the arc of history towards greater gender equality and more inclusive global growth.

You can vote with your time, your wallet, and your social media accounts. You can run for office, climb the corporate ladder, and start your own venture.

You can mentor others and build coalitions with those who share your view. And you should certainly learn from those who disagree with you.

And one more thing: as you move into leadership positions, you can be the best possible version of yourself—by hiring women, promoting women, investing in women, and by promoting civility in public and private discussions.

To read the full article, see Christine Lagarde’s empowering speech on the IMF website.

After U.S. Presidential Election: Starwood Hotels Optimistic on U.S. & International Investing

CNBC | by Elizabeth Gurdus | Monday, 24 Oct 2016

Starwood CEO: ‘I’m bullish’ on real estate

With home prices on the rise, international companies breaking into the U.S. travel space and the election almost over, Starwood Capital Group Chairman and CEO Barry Sternlicht said Monday that he is bullish about the future of the real estate market.

Sternlicht said that his company’s broad reach across the real estate space — with hotels, apartments and malls in the United States and abroad — enables him to view the market on a broader scale.

“I think you can see acceleration in spending, incomes are rising,” Sternlicht said. “I’m seeing that real estate markets, in general, have never been better in the United States.”

He told CNBC’s “Squawk Box” that rising prices of apartments and single-family homes were major contributors to the real estate market’s success.

Sternlicht said some of the more major U.S. markets were buckling, taking a backseat to more up-and-coming cities like Seattle.

“There are more cranes in Seattle downtown than any city in the country, more than San Francisco and New York combined,” Sternlicht said.

 

The CEO noted that Nashville, Portland, Atlanta and Denver are also seeing substantial growth.

Sternlicht spoke to some international players looking to break into the travel and hotel space as well, in response to Blackstone’s deal with Chinese travel conglomerate HNA that was announced Monday.

“I think for many of these Chinese life[style] companies and travel companies, this is diversification, this is a currency hedge in case they continue to have to lower the currencies against the dollar because of the slowing growth at home,” Sternlicht said.

The sheer number of Chinese customers who travel make deals like Blackstone’s reasonable, if not attractive, for Chinese companies, he said.

So, with business strong and international interest in the U.S. market high, Sternlicht remains optimistic looking past the presidential election barring some sort of international disaster.

“I think the economy might surprise us,” Sternlicht said. “Post the election, I think you might see companies take a more aggressive stance on spending their capital, building their plants and hiring, and the wages are going up.”

For more details about this article, see CNBC.

3 of the World’s Most Inspiring Hoteliers

Hospitality Net – Trivago Hotel Manager | 29 Sep 2016 | by Aly Thompson

In any business, success comes from drive and passion more than anything else. That said, motivation can wane at times. What better way to restore your focus and reinvigorate your imagination than to read about an inspiring role model? To help keep your motivation high in seasons to come, we’ve crafted a select list of inspiring hoteliers just for you.

Frank Fiskers is Inspiring Hoteliers Sustainability

Twitter @frankfiskers & @ScandicGlobal

Follow him if you appreciate no-nonsense management with a focus on eco-friendly sustainability. He’s considered to be one of the hottest people in the hotel industry for his ability to drastically grow the bottom-line through excellent asset management and award-winning sustainable practices. He’s inspiring hoteliers on twitter with his forthright, can-do attitude and sustainability insights.

Frank re-joined Scandic in 2013 after working with them for several years prior. Since then, he’s nearly doubled its size. Under Frank, Scandic holds roughly 30% of the Nordic region’s market share. If you’re a visual person, take a look at Scandic’s global Instagram for social inspiration.

Why we respect him: He’s a commercially-sound crusader for sustainable hotels.

Do you own or manage a chain hotel? Are you ramping up for a period of growth? Admire sustainability? If you answered yes to any of these, consider Frank as a choice role model, and Scandic as your brand muse. Over 20 years ago, Scandic coined the idea to “hang up your towel if you want to use it again” and spare the waste. Now, this practice is used by hoteliers across the globe. And that was just the beginning.

His specialty is growth-management through green initiatives and sustainability.

To grow the brand, Frank and Scandic aim to provide guests with more than just another hotel stay. They want guests to truly feel welcome while being a part of something that is sustainable for our environment. Every detail, from the bed to breakfast, is sustainable. This attention to detail resonates with business and leisure travelers, and it’s proven to be an award-winning strategy.

His brand ethos:  “…Sustainability is not a separate issue, but it is integrated into everything we do.“

Niki Leondakis Creates Concepts via Inclusive Management

Twitter @Niki_Leondakis & @CommuneHotels

Follow her if you’re looking for a leader who understands how to empower employees. Leondakis is a serial hotelier who functions at a high caliber to achieve great success through creative solutions. Her ability to embolden employees will continue to support Commune Hotel’s strategic growth and brand awareness. If you like one dose of motivation and two doses of hospitality insights, you’ll love her feed.

She joined Commune Hotels as its CEO in 2012 after almost 20 years with Kimpton. Her strength? Culturally transforming the way people think about hotels, food and beverage, and guest experience.

Why we respect her: She has an inclusive approach to people management!

Her leadership style encourages creative solutions that cultivate a flexible and relevant brand. When challenged, Niki consults with staff from all levels to come up with the best solution. This helps Commune Hotels develop unique hotel concepts that would not otherwise be possible

Her specialty is people.

For Niki, the people around her need to feel empowered and happy. When it comes to staff, she fosters a creative and inclusive environment. This instils a sense of pride and ownership among staff. She believes  that everything is possible, for everyone. And this belief is central to the brand, both front and back-of-house.

Not only is the portfolio of Commune Hotels and Resorts growing rapidly, they’re respected by guests, employees, and major industry players. Commune is noted as one of the ‘Best Places to Work’ by Fortune because of this. If you’re looking to inspire staff and grow your business from the inside-out, take a page from her book.

Her business ethos “When you give permission to people to be their best selves, they will give us more, they’ll be more productive and we’ll attract better talent.”

Sonia Cheung is treating hospitality as an experience

Sonia, unlike the previous two inspiring hoteliers, doesn’t have a personal Twitter feed but Rosewood Hotels has one—check it out.

Twitter @RosewoodHotels

Follow Rosewood Hotels if you’re a Millennial moved by luxurious designs and snaps of once-in-a-lifetime experiences. Their style is chic and unique, with an inspirational, photo-heavy feed.  Rosewood is determined to provide hotels that represent their surroundings, further enhanced with different experiences that complement the sense of place. If you follow them, you’ll find ways to involve your own selection of tastemakers, enriching the way you market your hotel’s destination.

Sonia Cheung, the CEO behind Rosewood, understands what Millennial travelers want. This is key in an industry where Millennials will soon make up the biggest buying demographic.

Why we respect her: She’s young, capable, and understands that marketing experiences to Millennials are where it’s at.

Rather than focusing on offering premium linens and newspapers, she aims to provide guests with an unrivalled experience.  Her approach is unique in that each Rosewood suits the soul and sensibilities of its location instead of a set in corporate style. The hotel offers activities to enhance guests’ experiences, connecting them with their surroundings. Because of this, Millennials, in particular, are flocking to the brand.

Her Specialty is treating hospitality as a relationship.

Hospitality, for Cheung, is all about relationships with people and places. Her concept of ‘relationship hospitality’ will nearly double the number of properties it runs before 2020. For Sonia, every hotel must be distinct, clearly reflecting its relationship with its surroundings as well. Now, Rosewood Hotels is well on its way to solidifying itself as an experience rather than just another luxury hotel chain.

Her brand ethos:  “…a hotel can only achieve exceptional status when it represents the soul and sensibilities of the destination…”

For more details about this article, see Hospitality Net.

The Most Expensive House In The World Could Sell For $1.1 Billion – Located in the French Riviera

Forbes | by Cecilia Rodriguez

What can justify a $1.1 billion price tag for a house?

Before searching for the features behind the number, let’s clarify that in this case, “the house” is rather a large, opulent mansion on the French Côte d’Azur, set in a “small” privileged refuge between Nice and Monaco frequently described as the ‘billionaires’ playground.’

First, there’s the house itself, with the understated name Villa Les Cèdres—The Cedars—at the center of Saint-Jean-Cap-Ferrat, known in French as a “presqu’île,” or “almost island.”

The description of the magnificent property in the French press includes 10 bedrooms, a ballroom, concierge, a chapel, 50-meter swimming pool dug into the rocks, a winter garden and stables for 30 horses.

Villa Les Cèdres, the world’s most expensive house Photo: YouTube

 

But what seems to be the most valuable aspect of the property is its botanical park, considered one of the most beautiful private gardens in Europe. It covers more than 35 acres with 20 greenhouses, is overseen by 15 full-time gardeners, and features some 15,000 rare tropical species, also reportedly Europe’s largest collection of tropical plants.

“No real estate transaction has ever reached such heights, even at world level where the last record is the sale of a ranch of 210,000 hectares in Texas that was offered for $725 million,” wrote Bursier.com.

Then there’s the location. Saint-Jean-Cap-Ferrat now has the most expensive price per square meter—more than €200,000 at the top end—in the world, according to le-gotha.com: “More than 50 of the most beautiful villas of the 600 on the presqu’île are worth their weight in gold. It’s true that there’s very little for sale because the biggest owners in Saint-Jean-Cap-Ferrat are very attached to their sumptuous dwellings, even if they come only some weeks of the year.”

A view from Cap Ferrat Photo: Wikipedia

 

With a population of  just over 2,000, it has always attracted celebrities, royalty and some of the best-known “rich and famous,” from around the world and has been described as ”the escape from Monaco for those burdened with taste.”

It’s tony enough to have drawn billionaire co-founder Eduardo Saverin for his wedding in June, when he rented the entire Le Grand Hôtel du Cap-Ferrat for four days and 350 guests.

The list of those who have vacationed at the house on offer include Winston Churchill, who loved painting the gardens, Charlie Chaplin, David Niven, Elizabeth Taylor  Richard Burton, and Prince Rainier III of Monaco. Current neighbors include British composer Andrew Lloyd Webber and tech tycoon and Microsoft MSFT -0.24% co-founder Paul Allen. Other rich families like theFerrero (Nutella) of Italy, the Mondadori from the publishing firm, French couturier Hubert de Givenchy, advertising titan Lord Maurice Saatchi, and assorted Russian oligarchs own houses in Cap Ferrat.

Villa Les Cèdres as it was when King Leopold was its owner

 

Finally, there is its history: Leopold II, king of Belgium between 1865 and 1909, who’s remembered largely because he privately owned and despoiled the Congo Free State in Africa, was a big fan of that part of the French Riviera and also owned  the entire west side of the Cap Ferrat. In 1904, he purchased the Villa Pollonnais, a 15-acre mansion built in 1830, changed its name to Le Cedres, made extensive renovations and used it as his main holiday home.

It’s also said that although the king lived most of the year in Monaco, he used Cedars  to accommodate his very young lover Caroline Delacroix who he had met in 1899 when she was only 16 and he already 64 years old. He made her Baroness Vaughan and his morganatic wife by the end of his life – meaning neither she nor her children would have any claim on his possessions or title.

The villa was sold in 1924 to Alexandre Marnier Lapostolle, the owner of the Grand Marnier liquor brand. Until June this year when Grand Marnier was bought by the Italian group Campari-Cinzano, Les Cedres was owned by Grand Marnier heiress Suzanne Marnier-Lapostolle. The house was included in the acquisition.

Grand Marnier started with Jean-Baptiste Lapostolle, who founded a fruit liqueur distillery in 1827. In 1876 his granddaughter married  the son of a wine-making family from the Sancerre region, the Marnier. The company had been in the family for six generations.

The heiress of The Cedars has said that she wants to downsize.

For more information, see Forbes about this article.

Property Investor Confidence Remains High in U.S. Despite Global Market Volatility

World Property Journal » Miami Edition | By Michael Gerrity | July 25, 2016 10:00 AM ET

According to a property report released this past week by Akerman LLP — a top 100 U.S. law firm – real estate investors and lenders have a nearly unanimous view of the U.S. commercial real estate market in 2016.

The Akerman U.S. Real Estate Sector Report found an overwhelming 92 percent of real estate executives had little or no change in their optimism compared to last year. After a six-year run of recovery, there also is a measured tone of cyclic expectancy and a gathering sense that a slowdown is a sign of a healthy market correction.

Against the backdrop of an uncertain global marketplace, the Akerman Report reveals U.S. commercial real estate is maintaining a favorable position and the strongest resistance to market volatility, attracting a deeper and wider pool of investors than ever seen before. Unprecedented amounts of offshore investment dollars will continue to enter the United States as a safe haven for their assets. U.S. investor focus will shift from yield motivation to capital preservation, with a growing number of them considering longer-term investments in anticipation for the next up-cycle. As long as the U.S. economy continues to show momentum, the Akerman Report anticipates positive activity through the end of 2016, including a greater investor appetite in smaller markets, compared to previous years.

“Any time you have extended growth periods, ultimately there needs to be a reset – a rebalance of supply and demand – and these moments in economic cycles are actually very strategic for us,” said Stephen Owens, president of Swire Properties Inc.

“Even with slow growth, the United States still has the best property system in the world and our commercial real estate holds the top spot across global capital markets,” said Vincent Signorello, president and chief executive officer of Florida East Coast Industries.

Key Akerman Report Findings:

Strong fundamentals, including low interest rates (37 percent) and continuing improvement in the U.S. economy (28 percent) are two primary factors instilling investor confidence.

• 56 percent of real estate executives cited global disruption and a volatile investment market as the most pressing issues impacting the real estate sector. More than a quarter (27 percent) also cited federal gridlock and uncertain government policy as a principal concern.

• When asked to select the top three sources that will lead real estate financing over the next year, 42 percent of executives selected private equity, 37 percent chose banks, and 33 percent identified REITs. However, heightened regulations and other external forces that are pressuring the real estate market may bring about further changes to the financing landscape. Twenty-seven percent of executives believe foreign capital will remain a chief source of real estate financing. Insurance companies and non-traditional investment vehicles, such as pension funds, are also increasing their real estate capital allocation.

• More than half of executives (59 percent) believe multifamily will continue to be the most active real estate sector, followed by single family homebuilding (18 percent), industrial (7 percent), office (6 percent), retail (6 percent), and hospitality (3 percent).

• Forty percent of executives say multifamily will attract the most foreign investment, with the majority of capital coming from Latin America, mainly Brazil. More than half (five to seven in 10) expect China will be the dominant source of foreign capital in all other core real estate sectors.

“We are seeing record levels of institutional and global equity circling the real estate market as a core investment option,” said Richard Bezold, chair of Akerman’s Real Estate Practice Group. “There is still significant capacity to invest in burgeoning real estate markets and dynamic second tier cities, expansion and innovation in many asset classes, and a marketplace that is thinking ahead to the future of mobility and sustainability across the nation’s most trend-setting cities.”

Top Three Real Estate Development Megatrends: Greatest short-term impact

• No. 1: Generation-Specific Housing. 34 percent of real estate executives believe the aging population and its housing preferences will have the greatest effect on real estate development in the next 3-5 years. With more senior housing construction underway, the ability to secure financing appears to be top of mind for these developers, particularly in certain sub-sectors that are challenged with navigating layers of complex regulations.

• No. 2: Co-Urbanism. 29 percent of executives say changing lifestyle preferences in a compact city center and society’s shift to a sharing economy will have a significant impact on real estate development in the near-term. Along the same lines, 14 percent believe office mobility and collaborative workplace design are key trends shaping the next iteration of buildings and spaces.

• No. 3: Cyber Risk in Real Estate. 15 percent of real estate executives ranked the effects of technology as one of the most important issues impacting real estate. Ransomeware and other attacks designed to manipulate systems or seize private information have brought attention to the industry’s exposure to cyber risk, as well as the need to develop a security and privacy framework as technology in the sector advances.

Five Real Estate Development Forecasts: Greatest long-term opportunities

• Potential in Cuba. A historic find in the Akerman Report, the majority of real estate executives (32 percent) predict that Cuba’s burgeoning real estate market will present the greatest longer-term opportunities for U.S. investment in Latin America. The unprecedented response follows the gradual rapprochement between the United States and Cuba after more than a half-century of Cold War opposition, and an uptick of American travel, investment, and commerce on the island nation.

• Post-Brexit. The geopolitical, economic and global financial market uncertainty resulting from Brexit may extenuate some trends that were otherwise already happening in the United States. These uncertain conditions should result in an influx of European and British investors entering the U.S. commercial real estate market, particularly in gateway cities list New York, Miami and Los Angeles, providing alternative funding solutions in the capital stack.

• The Green Rush. 25 states, plus the District of Colombia have legalized select forms of marijuana, making this one of the newest emerging segments in the commercial real estate market. Growing demand for extracted products in the form of wax, oils, edibles and creams is further driving retail sales, tourism and a movement of millennials to cities where marijuana is legal. As more states legalize marijuana, investor interest and development opportunities will expand across all asset classes in even the smaller markets.

• Generation Z. It is estimated that more than 30 million post-millennials called Generation Z will enter the workforce by 2019, with a new set of interests and demands that will reshape the next wave of development. Those born in the early-2000s represent the first cohort to grow up entirely during the age of the Internet, smartphones and social media. Travel, office mobility and global connectivity will be increasingly important in their adulthood. Technology and green building will be key considerations in their future home buying decisions. As part of the sharing culture, Gen Z will not only want to be exposed to different entertainment options, they also will want to help create it.

• The Autonomous Vehicle. A modest 5 percent of real estate executives say infrastructure development is a priority. While autonomous vehicle developers are focusing on creating driverless cars that can exist within the nation’s current infrastructure, the rollout of new modes of transportation over the next decade will force the public and private sector to rethink the way cities are built and organized.

For more information about this article, go to World Property Journal and Akerman 2016 Report.

Property-Sector Profit Warning Highlights Brexit Risk for U.K.

By Art Patnaude and Olga Cotaga  | June 27, 2016 11:54 a.m. ET

According to an article in The Wall Street Journal, shares in U.K. real-estate firms—from office landlords to property brokers and home builders—were hammered Monday after Britons last week voted to leave the European Union, a move analysts warned could cause property values to drop.

Foxtons Group PLC, a prominent property broker focused in London, warned that its 2016 earnings will be significantly lower than last year, suggesting an impending slowdown in housing deals. Foxtons shares fell as much as 24% in morning trading in London before being temporarily suspended.

Suspensions occur when a shares fall more than 10% from their closing price level on the previous day.

Shares in the biggest U.K. housebuilders were also temporarily suspended after steep losses, with Persimmon PLC down 23%. Other home builders, including Taylor Wimpey PLC, Barratt DevelopmentsPLC and Berkeley Group Holdings PLC, took big hits.

Land Securities PLC and British Land PLC, the two biggest listed U.K. landlords, also saw shares drop. Since the referendum results were announced Friday morning, Land Securities lost 24% of its value, while British Land shed 29%.

The sharp falls followed a broad expectation that U.K. real-estate values could drop, caused by transactions drying up amid uncertainty about how the U.K. will extricate itself from the EU.

In the run-up to the referendum, uncertainty over a possible Brexit vote had already hit the housing market throughout the U.K. Earlier this month, property brokers were predicting prices would fall this summer for the first time since 2012.

For housebuilders’ earnings, a Brexit-inspired fall in consumer confidence, or if banks become less willing to lend, could be “very damaging,” analysts at Swiss lender UBS Group AG said.

For landlords that own U.K. commercial real estate, values “now look likely to decline moderately over the remainder of the year,” according to U.K. asset managerAviva PLC.

Part of this could be driven by exodus of companies to Europe, led by financial services firms, which would have an outsize impact on London office market, analysts said.

Jefferies analysts estimate the U.K. capital could lose 100,000 jobs to Europe.

Like with commercial property in London, the housing market has a greater reliance on overseas buyers, making it especially susceptible to weaker sentiment from foreign investors.

“Areas which are more reliant on EU buyers, such as South Kensington and Angel, may well see a price correction,” Robin Paterson, chief executive of U.K. Sotheby’s International Realty, on Friday. He noted that prices in other areas could still perform well.

Transaction levels of high-end homes in central London had already been falling over the past year. Tax hikes, years of rising prices and Brexit uncertainty helped keep buyers at bay. Foreign investors from Asia and the Mideast were also contending with concerns over slowing global economic growth, weak oil prices and stock-market shocks.

Some analysts have noted that the sharp drop in the value of sterling against other currencies in the last few days could encourage bargain hunters from abroad. Pressure on the British pound intensified Monday after the currency closed at its lowest levels in more than 30 years on Friday.

“Buyers will expect a seriously good deal,” said Roarie Scarisbrick, partner at buying agent Property Vision.

Transactions are a cornerstone for commission-lead brokers like Foxtons, which, like other brokers and analysts, had expected a boost to activity in the London housing market if Britons voted to remain in the EU.

“The upturn we were expecting during the second half of this year is now unlikely to materialize,” Foxtons said in a statement. Challenging conditions “are now likely to continue for at least the remainder of the year.”

 

Cushman & Wakefield-Property yields keep falling – where are the opportunities in Europe?

Real Estate Market Report EUROPEAN FAIR VALUE INDEXT Q1 2016 | Cushman & Wakefield | 10 May 2016

Key Highlights from the Report:

• Cushman & Wakefield’s European Fair Value Index™ was 56 in Q1, up from the Q4 published figure of 55 (Figure 1).
• Just 37 of the 117 markets included in our index were classified as underpriced for Q1, with industrial continuing to be the most attractive sector.
• Baltics and CEE regions have the highest share of underpriced markets and attractive opportunities for investors.
• Of the larger markets, Paris industrial, Milan industrial and Dublin retail show as underpriced. On the basis of pricing alone, the five most attractive markets are all industrial: Brussels, Antwerp, Madrid, Riga and Barcelona.
• Although bond yields fell across Europe this quarter, in several markets the impact on fair/required returns was more than offset by an increased illiquidity and property risk premium.
• We believe the expansion of the Eurozone QE programme announced in March would be supportive of real estate investment and we expect yields to gradually move out only from 2018-19, dependent on the market.
• On the occupier side, we expect moderate rental growth in the majority of markets supported by economic growth.
• We expect the index to decrease in the short term as investor demand continues to push property yields lower and attractive investment opportunities diminish. The index should level off at around 45 by end 2017 and then recover.
• The risks to the outlook include China hard landing, geopolitical tensions and potential for policy errors.

See the Cushman & Wakefield European Fair Value Indext Q1 2016 full report.

Bisnow’s Lodging and Innovation Conference-Los Angeles, California-28th April 2016

I attended the U.S. Lodging and Innovation Series (BLIS) in Los Angeles, California this week sponsored by Bisnow, a trendy multi-media company that organizes news and conferences for business and commercial real estate. Bisnow attracted top hotel industry speakers including John Vanderslice , Global Head of Luxury & Lifestyle Brands Hilton Worldwide, Mark Harmon, CEO of Auberge Resorts, and Xavier Mugraggi, CEO of Club Med.

The topic of discussions focused on the fact that the hospitality industry is constantly transforming.  According to Bisnow, travel companies are doubling efforts to meet travelers’ demands for technology and wellness, and the sharing economy and the emerging millennial market are forcing industry leaders to rethink their business models. Even in a market where hotel occupancy rates are high, disruptive companies like Airbnb are putting the pressure on hoteliers to provide unique and sustainable travel experiences is greater than ever before.

Chip Conley, Head of Global Hospitality & Strategy, Airbnb, gave an opening keynote and said that 60% of Airbnb guests stay one week or longer and 16% over one month.  30% of the guests stay in the U.S. and 70% are outside of the U.S.  Airbnb recognizes a trend of guests, primarily entrepreneurs who are combining their business with leisure travel, and have a more nomadic lifestyle.

The speakers also discussed the current state of hospitality development, opportunities and challenges in hotel investments, economic key drivers, and trends in construction and design.

Noah Silverman, Chief Development Officer for North America Marriott, says their business strategy is reactive and proactive and are seeking opportunities with owner investors and franchise partners.

Michael Homeier, a Partner at Homeier & Law, PC moderated the discussion on hotel financing. Hotel and other commercial financing continues to be attractive in the U.S. to foreign investors utilizing capital stacks and structure their deals with U.S. government EB5 program and federal and state tax credits.  Primarily Chinese and Middle Eastern investors utilize these financing options to fill the gap between debt and equity and these investors continue to look for all hotel asset classes in the U.S. and Europe including foreign trophy assets.

Besides discussions on the luxury and resort brands, the conference also focused on innovation and new distribution models, including boutique hotels and upcoming brands.

Rob Lowe, CEO of the Lowe Hospitality Group says their focus for hotel resorts is on the “experience” and the other panel members agreed that guests are looking for character in their environment, location, more contemporary design yet consistency with local culture where guests can be a part of the community in where the hotel is located.

For example, Lowe hotels offers guest experiences in on-site farming for fresh produce, unique outdoor family activities, and spas that offer something different than day spas.

The future strategies of the hotel industry is looking at ways of integrating innovative technology and blending the needs of the baby boomers with the millennials to give guests a home away experience.

International Real Estate Conference – MIPIM 2016 – Cannes, France

City of London Developments

This year at the MIPIM 2016 was phenomenal!  MIPIM, held yearly at the Palais des Festivals in Cannes, France brings together the most influential real estate investors, developers, innovators, and city leaders from all international property sectors – office, residential, retail, healthcare, sports, logistics and industrial.

In four intensive days, over 21,000 participants gather from around the world for premier property expos, exclusive networking opportunities, conferences from key sectors, and prestigious awards of international property projects.

With 89 countries represented, attendees also included capital & equity fund managers, business & service providers, architects & planners, brokers, and local & public authorities.

Attendees connected with peers, clients and business targets during thematic lunches, after hour cocktails, and meetings throughout the days and evenings.

The premium closed-door summits discussed current global issues and included institutional investors, corporate real estate professionals, and political leaders.

New this year, the influential women of the real estate industry met for a networking cocktail to kick-start MIPIM.

The MIPIM Innovation Forum took place in a 1,300 m² pavilion and gathered all innovation stakeholders to showcase the most innovative solutions and practices to increase the value of property assets.

Best Office & Business Development – Cloud, Paris

Best Hotel – JW Marriott Venice Resort & Spa

Les Docks Village – Constructa -Marseille

Created in 1991, the MIPIM Awards honor the most outstanding and accomplished projects around the world.  Some of the winners included: for the Best Hotel – JW Marriott Venice Resort & Spa; for the Best Refurbished Building – Papillon; for the Best Residential Development – Katscha, in Norrköping, Sweden; for the Best Shopping Centre – Les Docks Village, in Marseille, France; for the Best Office & Business Development – Cloud, Paris; and the People’s Choice Award – Shanghai Tower.

The Papillon Project, the word meaning butterfly in French, is located in Düsseldorf, Germany, and is a metamorphose of an old war bunker complex into iconic residential apartments complete with futuristic car elevators.

Christine Baird with Norm Miller, Hahn Chair of Real Estate Finance at University of San Diego.

Poland Economic Development Luncheon

FIABCI, National Association of Realtors, with many States and local Realtor Associations represented including the San Diego Association of Realtors, and University of San Diego, and WWIRE (World Women in Real Estate) were also present at the MIPIM.

 

CBRE Report Released|2016 Global Real Estate Market Outlook

From CBRE 2016 Global Real Estate Market Outlook

Moderate economic growth with low interest rates, punctuated with bouts of pessimism and volatility—the factors that have characterized the world economy for the past few years—are likely to continue in 2016, supporting moderate growth in commercial rents and investment sales volume globally, according to CBRE Group, Inc.’s 2016 Global Real Estate Market Outlook.

“The current environment of variable but generally improving growth in the developed world, alongside low interest rates and low inflation, is very supportive of consumers and commercial real estate markets,” said Richard Barkham, CBRE’s global chief economist. “There are some risks for sure, including weakening sentiment due to volatile stock markets, rising interest rates in the U.S. and the U.K., financial stress in emerging markets and the slowdown of the Chinese economy. However, because consumers in the U.S., Europe and even China are in good shape, we think the global economy is strong enough to withstand these challenges and that the real estate and economic reality will be better than expected in most places in 2016.”

• Economy | Expect 2016 to be a year of volatile markets but steady economic growth. Consumers in the U.S., EU and many parts of Asia Pacific are spending gains from rising incomes, low interest rates and low oil prices, which should support GDP growth.
• Rents | In 2016, global prime rents across the three major property types—office, industrial and retail—are expected to grow 2.2% on an annual basis, according to estimates from CBRE’s Global Rent Index.
• Capital Markets | Global commercial real estate investment markets are expected to remain active in 2016, but the pace of growth is anticipated to slow after six years of recovery and price appreciation.
• Office | Most U.S. and European office markets are expected to tighten further in 2016 as demand for space is expected to outpace limited new development. However, Asia Pacific office markets will be more mixed.
• Retail | Retailers and mall operators are adopting new “placemaking” strategies to compete with e-commerce, which combined with stronger consumers, should stimulate more demand for retail space globally.
• Industrial | Robust demand from e-commerce and third-party logistics companies for warehouse and distribution space—including for smaller in-fill locations within major metros—will continue to reshape the industrial market.

Download CBRE 2016 Global Real Estate Market Outlook