Tuesday, September 15, 2009

Middle Income Housing (MIH)– the next big real estate opportunity

Reveals Cityscape India 2009 survey

Mumbai, September 4, 2009: An all India survey conducted by Cityscape India reveals that real estate consumers across India are rooting for projects in the MIH (middle income housing) segment, which the real estate industry needs to introspect closely. Over 53% respondents felt that developers are not catering to the rising emerging middle class in India. Over 79% of the respondents with income of Rs. 6L per annum stated that the ideal affordable home would be in the range of Rs. 20Lacs – Rs. 30Lacs. Qualitative response indicates that most affordable housing projects are located in areas which are extremely distant from the main city and also lack infrastructural eco-systems.

Majority of the respondents felt that reputed developers only cater to the upper classes and do not have anything to offer the middle of the pyramid. The survey also revealed that ‘low cost housing’ projects of 400sq.ft were not typical projects that the middle class would buy into due to lack of infrastructure, poor quality of materials and lack of space for family.
Graham Wood, Cityscape India Group Director comments, “The Indian real estate industry need to listen actively to consumers across India. Their feedback is clearly indicating that MIH is a segment which they need to now focus upon actively. Affordable housing is a different category from MIH; and as the real estate market matures – developers will specifically need to come up with MIH solutions in various cities. Developers have to innovate to bring prices to realistic levels to win back their trust”

Consumers also feel that the 2006 real estate boom was primarily driven by investors and builders, not the real buyers. Today, very few developers are able to keep commitments on timely delivery of projects as banks have stopped lending and genuine buyers have lost trust in the industry.

The Cityscape India conference will have an opening session in Mumbai on December 2009 to discuss the above with leading influencers in the real estate industry.

About Cityscape India

India’s largest and only business-to-business real estate investment and development exhibition and conference will once again take place from 9 – 11 December 2009. The world’s top, real estate developers, leading architects, consultants, engineers and other professionals involved in the design and construction of real estate will attend Cityscape India to create joint ventures partnerships, source investment opportunities, build profitable relationships and access unbiased, in-depth information on the Indian real estate market
For more information please visit www.cityscape-india.com

Tuesday, September 1, 2009

World comes to Dubai seeking answers

Cityscape Dubai to explore how best to survive and prepare for the recovery in a still rapidly changing economic environment

The world of real estate investment is to descend on the United Arab Emirates this autumn to seek solutions from what some have referred to as the first great depression of the 21st century, say the organisers of the Cityscape Dubai.

“With reduced liquidity and many projects on hold, investors, developers, architects, indeed the entire real estate industry around the world, is looking for answers to the same questions,” said Chris Speller, Cityscape Group Director. “How do we survive the recession? When can we expect stabilisation? When will the banks start lending again? When will the crisis turn into an opportunity?”

Cityscape Dubai, now in its eighth year and part of the largest business-to-business real estate investment and development brand in the world, encompasses a major exhibition and a series of conferences taking place at the Dubai International Exhibition and Convention Centre from 5-8 October 2009.

“With the radical worldwide economic shakeout, attention has firmly turned onto realistic perspectives on the real estate investment landscape both globally and regionally,” Speller added. “Thousands of participants from more than 100 countries throughout the world have already registered to attend. They are serious players searching for specific answers, which is why Cityscape Dubai 2009 is embracing realism and transparency.”

Among them are companies such as ING Real Estate Investment Management of Hong Kong. Richard T.G. Price, CEO Asia, said: “It is more important than ever to get first hand insights from our clients and partners as to their objectives and expectations for the real estate markets around the world.”

Similarly, Jesper Koll, President and CEO of Tantallon Research, Japan, said: “We all want to know when the global crisis will turn into an opportunity. Cityscape Dubai is poised to help us find a solution.”

Kosta Petrov, Director of the Cityscape Dubai conference and the World Architecture Congress that runs in parallel, said this year’s event – while still the world’s largest real estate show of its kind – would not be about “out of this world” creations.

“Last year saw the beginning of what is being referred to by some economists as the first great depression of the 21st century,” he added. “With liquidity issues and many project developments still on pause, this year is about how best to survive and prepare for the recovery in a still rapidly changing economic environment. In terms of potential new business opportunities, Cityscape Dubai - as the world’s largest real estate show - has no global equivalent.”

Petrov said the Cityscape Dubai conference will bring together “some of the most powerful investors, developers and economists on the planet.” Meanwhile, the World Architecture Congress (5-7 October 2009) has been put together in association with Continental Europe, Hong Kong, Japan and UK chapters and the International Committee of the American Institute of Architects. “The world’s most respected visionaries will share their experience and outlook in a global recession,” he added.

In addition, the Cityscape Dubai Facilities and Asset Management Conference is on 4 – 8 October attracting delegates in the design, build and post-occupancy of buildings. There will also be a Cityscape Dubai “Green Day” on 7 October which will include green communities, green construction methods, energy saving issues, financing green buildings, regulations, facilities management, whole life costs and new materials and products.

For more information about Cityscape Dubai 2009, please visit www.cityscape.ae

JLLM - Global REIT & REOC Recovery Chart

  • There has been a dramatic fall in capital values of the world's largest REITs and REOCs. February 28 marked the trough in equity values, with the CVs of the world's largest REITs and REOCs falling by an average (unweighted) of 66% from Dec 2007
  • Since then, equity markets - including REITs and REOCs - have rallied strongly. REITs are up by an average of 88% and REOCs by 77% from Feb 28 to July 31. Some REITs such as Australia's GPT and Goodman are rising by 194% and 155% respectively, while the US based Host Hotels & Resorts rose 182%. REOCs also achieved large gains- the US REOC Forest City Enterprises is up 166% while Austria's Immoeast and the Sino Land Co of Hong Kong both rose by 146%
  • Nevertheless, despite the strong rally, on average, both REIT and REOC capital values remain around 42% below Dec 2007 levels.