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Real Estate Briefing - Archive | November, 2008

China: Property market likely to stabilize

Posted on 28 November 2008 by Laxman  |  Email |Print

From Chinadaily.com.cn: The central bank’s rare big interest rate cut will help stabilize the property market but will not ease property developers’ tightened cash flow, experts said.

The People’s Bank of China cut the benchmark interest rate by 1.08 percentage points on Wednesday, the biggest slash in 11 years, lowering the one-year lending rate from 6.66 to 5.58 percent….. Full Article: Source

Beijing may unveil more measures

Posted on 28 November 2008 by Laxman  |  Email |Print

From Beijingdaily.com.cn: The central government might defer the annual Central Economic Working Conference (CEWC) from late November to early or even mid-December to come up with more concrete policy measures to boost domestic consumption, a JPMorgan report predicted.

The report added that the measures are expected to boost the property and infrastructure sectors. Boosted by the soon-to-be-launched measures, together with the rate cut by the central bank, mainland property and infrastructure stocks saw a significant rally yesterday….. Full Article: Source

Shanghai housing market perks up

Posted on 28 November 2008 by Laxman  |  Email |Print

From China.org.cn: Trading volumes in the residential property market have staged a recovery in the last two weeks after the Shanghai government came up with its stimulus plan last month, statistics show.

According to a report by housing service provider E-House Research Center, last week residential property sales in Shanghai rose 24.6 percent to 176,600 sq m. During the week available new residential property rose 36.03 percent to 322,800 sq m….. Full Article: Source

Construction to begin on Saturday on China’s tallest building

Posted on 28 November 2008 by Laxman  |  Email |Print

From Xinhuanet.com: Construction will begin on Saturday on China’s tallest building - a 632-meter skyscraper named the Shanghai Center. The building will be completed in 2014 costing more than 14.8 billion yuan (about 2.2 billion U.S. dollars).

“The Shanghai Center is expected to increase domestic demand and economic growth amid the worldwide financial crisis,” said Kong Qingwei, board chairman of the Shanghai Center Construction and Development Co., Ltd….. Full Article: Source

Built to perfection: The Indian construction industry

Posted on 28 November 2008 by Laxman  |  Email |Print

From Indiatimes.com: Despite the recent upheavals, India has seen real estate demand ride a high tide over the past decade. Quality of construction has been extremely uncompromising with luxury and comfort given utmost precedence.

With a booming economy like ours where salaries have increased at whopping rates like never before; people seem well equipped to pay for it. With architecturally rich flyovers, majestic metro trains, malls, multiplexes, IT and SEZ parks, townships and brand new roads, construction business has come a long way….. Full Article: Source

India: Property prices may go further south

Posted on 28 November 2008 by Laxman  |  Email |Print

From Indiatimes.com: The terrorist attacks on Mumbai are likely to further pull down the sagging property prices in the city, especially in South Mumbai.

South Mumbai, the most expensive property market is expected to face a dip in value across all segments, including rentals, in the next six months, feel industry experts. …. Full Article: Source

Housing confidence in Taiwan hits record low

Posted on 28 November 2008 by Laxman  |  Email |Print

From Etaiwannews.com: Housing price expectations among Taiwanese consumers dropped for the second consecutive quarter to hit a record low in the third quarter of 2008, indicating increased pressure for prices to be lowered, according to the results of a quarterly housing demand survey.

The survey was conducted Oct. 1-15 among 959 home owners, 576 potential home buyers and 456 potential home renters by the Institute for Physical Planning and Information (IPPI) for the Council for Economic Planning and Development….. Full Article: Source

Dubai: Has the bubble burst?

Posted on 28 November 2008 by Laxman  |  Email |Print

From Economist.com: Gulf policymakers are still making cheery statements about the region’s limited exposure to subprime loans but are quieter about heavy investments in inflated local property markets by regional banks, particularly Islamic ones.

But worried banks are sharply reining in their mortgage lending. A series of arrests of senior businessmen as part of a fraud investigation is also making people twitchy. There is even talk of a coming “Gulf Enron”….. Full Article: Source

Dubai: Property buyers struggle to make payments

Posted on 28 November 2008 by Laxman  |  Email |Print

From Thenational.ae: Property developers are seeing more defaults by home buyers and property investors, who are caught between declining prices and a shortage of lending by banks, Dubai’s property regulator said today.

Marwan bin Ghalita, the chief executive of the Real Estate Regulatory Authority (Rera), said some developers had reported up to 40 per cent of buyers falling behind on their payments where units were sold off-plan by developers before they are completed or in some cases where construction has yet to even begin….. Full Article: Source

Dubai developers try to loosen buyers’ wallets

Posted on 28 November 2008 by Laxman  |  Email |Print

From Southasianpost.com: With banks curbing loans because of the global financial crisis and real estate agents finding it difficult to sell properties, developers in Dubai are wooing potential home buyers with lucrative payment options.

A recent survey found that more than 50 per cent of real estate agents in Dubai did not close a single deal last month. As a response, large companies including Emaar, Union Properties (UP) and ETA Star are offering innovative payment schemes to potential buyers ranging from rent-to-own to long-term payment plans….. Full Article: Source

Abu Dhabi to lend funds for property

Posted on 28 November 2008 by Laxman  |  Email |Print

From FT: Abu Dhabi, capital of the United Arab Emirates, has launched a state-backed mortgage lender to help finance the purchases of a slew of properties expected to come to the market in the future.

Abu Dhabi Finance has an initial capital of Dh500m ($136m, £89m, €106m) paid by its shareholders, which include Mubadala, the Gulf state’s sovereign investment fund, Abu Dhabi Commercial Bank and three big developers….. Full Article: Source

Uganda: Mortgages will lift properties

Posted on 28 November 2008 by Laxman  |  Email |Print

From Allafrica.com: Mortgage is the thin line between owning and renting a house. In it is the possibility for one to own their own house by just raising a fraction of the total cost of the property.

Many real estate developers in Uganda have been able to increase their liquidity and reduce the gestation period of their projects through coupling up with banks and extending mortgage to prospective home buyers….. Full Article: Source

UK: Commercial property development dwindles

Posted on 28 November 2008 by Laxman  |  Email |Print

From Bridgingandcommercial.co.uk: Commercial property developers are having a tough old time of late. Confidence is diminished, as are funds, and the market seems to have almost ground to a halt.

Research by property consultants, Drivers Jonas, has suggested that currently developers are not confident that they will be able to lease buildings once they are completed….. Full Article: Source

UK: House prices to fall a further 36 pc

Posted on 28 November 2008 by Laxman  |  Email |Print

From Telegraph.co.uk: House prices are set to fall a further 36pc over the next two years in what could amount to the worst post-war housing crash, according to the price of contracts being traded on the derivatives market.

Financial markets are pricing a further 22pc fall in the housing market over the next 12 months, with another 14pc in 2010, before flattening out in 2011….. Full Article: Source

Irish spend on property down 60% in 2008

Posted on 28 November 2008 by Laxman  |  Email |Print

From Easier.com: Irish spend on property in 2008 is forecast to fall to €15 billion, down 60% from €45 billion in 2007 and a phenomenal 73% down from the peak of €54.4 billion in 2006 according to Joan Henry, Head of Research at Savills Ireland.

This is one of the main findings of Property Outlook, Savills regular property commentary. Savills say it is imperative that the government and the banks take immediate action to solve the lack of liquidity that is crippling both the residential and commercial property markets….. Full Article: Source

House prices: How low can they go?

Posted on 28 November 2008 by Laxman  |  Email |Print

From Telegraph: If you thought that house prices had hit rock bottom, you were wrong. The bad times are about to get worse, say the experts, who predict a drop in property values of more than 30 per cent. When will the misery end?

Predictions that the prime London property market would remain aloof from the slump have proved wide of the mark: a separate survey by Savills estate agent suggests that prime London property prices will end the year 18 to 20 per cent down on their level at the end of 2007. …. Full Article: Source

North Yorks awards ING global property mandate

Posted on 28 November 2008 by Laxman  |  Email |Print

From IPE: North Yorkshire County Council has agreed to appoint ING Real Estate as global property manager for its £1.07bn (€1.26bn) local government pension fund.

The council initiated a search for a global property manager for a portfolio valued at around £60m in May, signalling its first foray into real estate….. Full Article: Source

German open-ended sector sees EUR 5 bln outflows in October

Posted on 28 November 2008 by Laxman  |  Email |Print

From Propertyeu.info: Investors withdrew almost EUR 5.1 bn from Germany’s open-ended property funds in October, according to figures released on Wednesday by investment and asset management body BVI. This resulted in net inflows into the funds of only EUR 500 mln over the first 10 months of 2008.

BVI attributed the latest outflows to withdrawals at end-October by large investors and asset managers which have had to reduce their property holdings….. Full Article: Source

Vienna lettings remain on high level says CBRE

Posted on 28 November 2008 by Laxman  |  Email |Print

From Europe-re.com: Although the global financial crunch leaves its marks in many sectors, the Austrian investment and Vienna office markets prove being astoundingly stable – this results from the analysis of CB Richard Ellis real estate experts.

Letting activities remained on high level in Vienna: 110,000 m² office space was let in Q3 2008, like in the previous two quarters….. Full Article: Source

UK Reits to struggle but better Europe

Posted on 28 November 2008 by Laxman  |  Email |Print

From IPE: UK REITs are entering unprecedented waters and are unlikely to achieve strong investor interest for at least a couple of years, according to Brend Stahli from Merrill Lynch.

The lack of debt available to investors coupled with the nature of property as a capital-intensive asset that is reliant on debt, means UK REITs are likely to suffer….. Full Article: Source

Spanish property sales down by 30%

Posted on 28 November 2008 by Laxman  |  Email |Print

From Kyero.com: Spanish third quarter house sales fell 30.5 percent year on year, steepening a fall begun earlier in the year amid chronic oversupply and credit restrictions, according to a recent report.

Spain’s College of Registrars recorded 130,884 house transactions between July and September, down 8.6 percent from the previous 3 months, according to a press statement….. Full Article: Source

Canada: Commercial property sales value rises 4%

Posted on 28 November 2008 by Laxman  |  Email |Print

From Canada.com: Commercial real estate sales in Calgary in the first three quarters of this year totalled just over $2.9 billion, up $118 million, or four per cent, from the same 40-week period in 2007, says a report by Avison Young.

The Fall 2008 Calgary Investment Review said there were 196 transactions for all six asset classes for the first nine months of 2008,compared with 296 sales a year ago and $2.8 billion in value over the same period….. Full Article: Source

Shake-up at ING RE Canada

Posted on 28 November 2008 by Laxman  |  Email |Print

From IPE: ING Real Estate announced is making significant management changes to its Canadian subsidiary and losing five members of its senior team.

ING Real Estate Canada is making a series of senior management changes Paul Dykeman, chief executive and Craig Newell, chief financial officer, alongside Lou Maroun, Kathy Harder and Jon Robbins will all leave their positions on 15 January 2009 “by mutual agreement”….. Full Article: Source

LandAmerica files for bankruptcy, sells businesses

Posted on 28 November 2008 by Laxman  |  Email |Print

From Reuters: LandAmerica Financial Group Inc filed for Chapter 11 bankruptcy protection on Wednesday and agreed to sell its largest underwriting businesses to Fidelity National Financial Inc, which withdrew a takeover bid for the title insurer last week.

The New York Stock Exchange said it suspended trading of LandAmerica shares. The shares, which peaked at more than $106 last June, plunged to 20 cents in electronic trade….. Full Article: Source

CB Richard Ellis feels industry’s pain

Posted on 28 November 2008 by Laxman  |  Email |Print

From Latimes.com: The world’s largest commercial real estate services company has seen its profit and stock price drop as it suffers along with property owners and landlords.

For decades, it has been the big-dog deal maker and property manager helping hammer together the office core of the nation’s downtowns, its far-flung industrial parks and vast shopping districts….. Full Article: Source

NAREIT reveals an uncertain future for REITs

Posted on 28 November 2008 by Laxman  |  Email |Print

From IPE: The National Association of Real Estate Investment Trusts’ annual convention in San Diego last week confirmed there is serious concern about the future of the REITs market in the current climate and how that will play out over the next couple of years.

Public REITs in the United States face a difficult market in 2009, according to speakers, especially as the value of REITs have dropped by 40% in the last month alone….. Full Article: Source

Canada: Pension plans hold the bulk of real estate investments

Posted on 28 November 2008 by Laxman  |  Email |Print

From Thestar.com: What do landmarks such as First Canadian Place, Toronto Eaton Centre, The Fairmont chain of hotels, and Yorkdale Mall have to do with you? Chances are, you may own them – or at least a share of them.

That’s because Canada’s leading pension funds, to which most working Canadians contribute, own much of the country’s top office and retail properties….. Full Article: Source

Schroder sees a future in ‘blind funds’

Posted on 28 November 2008 by Laxman  |  Email |Print

From IPE: Blind funds are likely to attract institutional investors entering the property market, according to William Hill, head of property at Schroders.

Speaking at the Schroders’ Property Media Roundtable, Hill said he was confident equity investors would start coming back into the market in 2010 and be attracted to blind pool funds because of what he sees as “their clarity and transparency”….. Full Article: Source

Global property slump in 2008, hangover predicted for 2009

Posted on 27 November 2008 by Laxman  |  Email |Print

From Euromoney.com: The impact of the credit crunch has been far-reaching, with global property markets left severely damaged. What started off as a largely isolated problem of the US sub-prime mortgage market and some structured credit intensified and spread across the globe over the course of 2008.

The repercussions will continue to impede business and thwart growth in property throughout 2009. In the first half of 2008, global direct real estate investment fell 42% from record levels set in 2007, according to research from Jones Lang LaSalle…… Full Article: Source

Citi went wrong with US real estate: Pandit

Posted on 27 November 2008 by Laxman  |  Email |Print

From Business-standard.com: Vikram Pandit, the chief executive of Citigroup, has said the banking behemoth’s putting in lot of money against US real estate is one of the main reasons for things going wrong at the company. “…What went wrong is, we had tremendous concentration in the sense we put a lot of our money to work against US real estate.

So how we got here is… By lending money and putting money to work in the US real estate market in a size that was probably larger than what we ought have done on a diversification basis,” India-origin Pandit said….. Full Article: Source

US house prices drop is biggest in 40 years

Posted on 27 November 2008 by Laxman  |  Email |Print

From FT: The price of previously owned homes in the US fell in October by the biggest amount in at least 40 years and the volume of sales also dropped, in a sign of the still mounting problems in the housing market.

The median price of existing homes fell by 11.3 per cent in October to $183,300 (€142,100, £121,200) compared with a year before, the National Association of Realtors reported yesterday - the largest annual drop since records began in 1968….. Full Article: Source

Canadian commercial real estate prepares to weather storm

Posted on 27 November 2008 by Laxman  |  Email |Print

From Investmentexecutive.com: A survey of 11 of Canada’s top commercial real estate markets indicates that landlords and tenants are taking a wait-and-see approach to commercial real estate transactions.

The survey by Cushman & Wakefield LePage covers the office, industrial, retail and investment sectors in 11 markets across Cnada….. Full Article: Source

Architecture Institute: Billings hit low

Posted on 27 November 2008 by Laxman  |  Email |Print

From Bizjournals.com: The American Institute of Architects is reporting that the Architecture Billings Index, which is compiled from a monthly survey of architecture firms around the country, is at its lowest level since the survey began in 1995.

Because the survey depicts a lag of nine to 12 months between architecture billings and construction spending, it is considered a leading economic indicator of construction activity….. Full Article: Source

Tyler-Donegan targets US distress with new fund

Posted on 27 November 2008 by Laxman  |  Email |Print

From Privateequityrealestate.net: Tyler-Donegan Real Estate is targeting distressed and value-add opportunities in the US with its recently launched vehicle, Mid-Atlantic Capital Fund.

The Frederick, Maryland-based real estate company is targeting $20 million for the fund, the company’s president, Chad Tyler said. It is expecting leverage of between $60 million and $70 million in purchasing power….. Full Article: Source

Open-ended funds are wrong choice for physical property

Posted on 27 November 2008 by Laxman  |  Email |Print

From Citywire.co.uk: What is the best structure to invest collectively in physical property? The lesson of the past year is surely that it is not open-ended funds. New Star this week became the latest in a long line of groups which has been forced to suspend redemptions in its property fund.

Behind the headlines there is widespread anecdotal evidence that fund management companies across the board have become effectively forced sellers of property assets in order to meet redemptions….. Full Article: Source

Housing measures ‘inadequate’

Posted on 27 November 2008 by Laxman  |  Email |Print

From FT: Housing experts were yesterday critical of a failure to do more to stimulate the market, which the Treasury has estimated could fall by around a fifth in the two years to the end of 2009.

Estate agents and house builders had called for a range of measures to immediately improve the wider residential market, such as a holiday on stamp duty land tax and further help for buyers, particularly first-timers….. Full Article: Source

Lehman’s European property portfolio only worth $1 bln, says PwC

Posted on 27 November 2008 by Laxman  |  Email |Print

From Propertyeu.info: PricewaterhouseCoopers has slashed the value of bankrupt US investment bank Lehman Brothers’ European property portfolio to $1 bn, down from an earlier estimate of $15 bn, citing external debt and falling property values.

According to PwC, which is marketing the portfolio, most of the assets are held in joint ventures, with different partners, and many of those joint ventures have significant external debt….. Full Article: Source

French property market to remain stable

Posted on 27 November 2008 by Laxman  |  Email |Print

From Vefuk.com: Buyers continue to outstrip supply of good properties in France. The French National Estate Agents Federation (FNAIM) reports that French property prices overall rose by 7.1% in 2006, 3.8% in 2007 and 1.7% in the 12 months up to July 2008 – making it one of the few places in the world that has seen continual price rises throughout the credit-crunch.

Generally, at VEF, we do not think that prices are still rising, whichever way you look at it. However, what we are sure of is that they are not falling significantly either….. Full Article: Source

Worst of British property cycle still to come

Posted on 27 November 2008 by Laxman  |  Email |Print

From Theaustralian.news.com.au: UK commercial property values have fallen 22 per cent from their June 2007 peak but will drop by that much again before this cycle ends. That prediction was made by Kim Wright, who oversees global real estate strategy for UBS.

Westfield Group, Lend Lease Corporation and Stockland are just a few of the Australian listed property companies to have bought into the British property market during the boom….. Full Article: Source

U.K. mortgage lending falls by more than half

Posted on 27 November 2008 by Laxman  |  Email |Print

From Thestar.com: Mortgage lending in Britain has more than halved over the past year, according to the British Banker’s Association – further evidence that the economic downturn is dramatically hurting the country’s property market.

The number of new home mortgages approved in Britain was 52 per cent lower in October than in the same month a year earlier, the industry group said yesterday….. Full Article: Source

Surge in demand for rental property in Bulgarian cities

Posted on 27 November 2008 by Laxman  |  Email |Print

From Propertywire.com: As property prices fall in Bulgaria the rental sector is increasing especially for apartments in cities, the latest figures show.

Sofia, Plovdiv, Varna and Bourgas, Bulgaria’s four biggest cities, have see a significant growth of 12% in the rental market in the first three quarters of 2008, according to figures from Address Real Estate….. Full Article: Source

Credit crunch blow to UK Islamic property loan market

Posted on 27 November 2008 by Laxman  |  Email |Print

From Propertywire.com: The UK government has ruled out issuing Islamic compliant debt, or Sukuk, mainly because of the credit crunch.

It had been expected in Islamic finance circles that the government would approve Britain’s first Islamic debt instrument to meet the growth of Islamic finance in the country…. Full Article: Source

Realty slump in Gulf region hits Indian firms

Posted on 27 November 2008 by Laxman  |  Email |Print

From Livemint.com: Many Indian real estate and construction firms and architects are feeling the heat of a real estate slowdown—in West Asia.

Over the past three-four years, developers and construction firms such as the Dheeraj Group, Hiranandani Developers Pvt. Ltd, Ajmera Group and Mayfair Housing (P) Ltd entered markets in West Asia, attracted by relatively low-cost land, rising demand and the scope for striking joint ventures (JVs) with local developers….. Full Article: Source

Saudi Arabia’s real estate market is Gulf’s powerhouse

Posted on 27 November 2008 by Laxman  |  Email |Print

From Zawya.com: Saudi Arabia’s real estate market is set to grow significantly over the next four years, a new report from Jones Lang LaSalle, the world’s leading real estate investment and advisory firm has found.

The report entitled “The Gulf’s Powerhouse - Saudi Arabia’s Real Estate Market” published on Monday as part of the Global Foresight Series, highlighted the breadth of the investment opportunity across the residential, office and hotel sectors in Saudi Arabia….. Full Article: Source

Middle East developer eyes enormous Indian real estate market

Posted on 27 November 2008 by Laxman  |  Email |Print

From Offplanpropertyexchange.com: India’s real estate market could reach a value of $60 billion by 2010, and become an “enormous” economic power, a Middle East developer has said.

Abdullah bin Abdulaziz Al Majed, vice chairman of Tanmiyat Group, was speaking ahead of the firm’s participation at property show Cityscape India 2008….. Full Article: Source

Dubai - built on cheap credit that is now disappearing fast

Posted on 27 November 2008 by Laxman  |  Email |Print

From Propertywire.com: When Dubai developer Nakheel unveiled the world’s tallest tower in a blaze of publicity and flashing lights at Cityscape on Monday October 6th everything looked great for the future of the emirate’s property sector.

But Wall Street was crashing, five US banks were failing, Iceland was going bankrupt and stock markets around the world were haemorrhaging….. Full Article: Source

Egyptian real estate set for strong growth

Posted on 27 November 2008 by Laxman  |  Email |Print

From Zawya.com: Loans-to-deposits ratio, low mortgage penetration and balanced exports make investment in Egyptian real estate sector a safe bet, said experts at a conference.

Mohamed Abdalla, President of Coldwell Banker Intercontinental Affiliates and Chairman of the Real Estate Committee at the Chamber, said Egyptian real estate is in a strong position in the face of the global economic crisis….. Full Article: Source

Singapore: Property market to soften

Posted on 27 November 2008 by Laxman  |  Email |Print

From Straitstimes.com: Property prices are set to soften and demand will weaken as the Singapore economy slows down, Minister for National Development Mah Bow Tan said on Wednesday evening.

Private housing prices have declined by 2.4 per cent in the third quarter of this year, and further price movements will ‘depend on the severity of the economic slowdown’, he added….. Full Article: Source

Thailand: Real estate loses billions

Posted on 27 November 2008 by Laxman  |  Email |Print

From Bangkokpost.com: The Suvarnabhumi Airport shutdown has scared away potential foreign investors and buyers in the property market, causing billions of baht worth of damage, according to Patima Jeerapaet, managing director of the property consultant Colliers International Thailand.

“It is worse than the Phuket International Airport blockade (in September). The overall situation is very bad. We just got cancellations from potential customers from Eastern Europe who had planned to fly to Bangkok,” he said yesterday. …. Full Article: Source

Australia new home sales rebound in October

Posted on 27 November 2008 by Laxman  |  Email |Print

From Reuters: Sales of new houses in Australia rebounded sharply in October as steep cuts in interest rates and government hand outs helped break a three-month run of falls, the Housing Industry Association (HIA) reported on Thursday.

The HIA said total sales rose a seasonally adjusted 4.5 percent in October, more than recouping a 1.8 percent drop in September. Sales of private detached houses jumped 6.7 percent, more than outweighing an 8.6 percent fall in the volatile multi-unit sector….. Full Article: Source

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