International Beat

International Beat

Australia’s Big Deal

Malaysia’s YTL Group acquired the Westin Perth for upward of $200 million from the BGC Group — the largest single-asset transaction ever in the Western Australian capital. The 28-story hotel, which opened in April 2018, has 368 guest suites, convention facilities, a restaurant, fitness studio, and spa. The sale, brokered by JLL Hotels & Hospitality Group, also includes Hibernian Place, a development featuring an outdoor plaza and a mix of hospitality with development potential for a commercial office tower.

Source: The Hotel Conversation

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Norway’s Sovereign Wealth Fund Cuts RE Allocation

Norges Bank Investment Management, Norway’s $1 trillion sovereign wealth fund, recently reduced its real estate allocation. The fund announced in February that it cut its target allocation to 3 to 5 percent, down from 7 percent, which includes shares in both listed and unlisted real estate investments. In the last decade, the fund has spent $25 billion on posh properties in Paris, London, and New York, but it will now focus more on REITs. “We would like to emphasize that real estate will continue to be an important part of the bank’s investment strategy for the [Government Pension Fund Global], and the fund will be a major player in the real estate markets in the years to come,” says Norges Bank Deputy Governor Egil Matsen. “The strategy is to be simple, with emphasis on cost-efficiency.”  

Source: Norges Bank, Bloomberg  

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European Retail Markets: What Looks Good?

Union Investment’s Global Retail Attractiveness Index measures the appeal of retail markets across Europe, North America, and the Asia-Pacific region. The index reflects consumer confidence, business retail confidence, changes in the consumer price index, and retail sales performance. The top five European markets in this year’s index are:

  1. Portugal
  2. Poland
  3. Czech Republic
  4. Germany
  5. Spain

Source: Union Investment

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Top Global Cities for Tech

Savills released its third edition of Savills Tech Cities, which ranks 30 cities around the world on a variety of metrics including volume of inbound venture capital, access to tech talent, real estate costs, and mobility services and infrastructure. This year’s top 10:

  1. New York
  2. San Francisco
  3. London
  4. Amsterdam
  5. Boston
  6. Singapore
  7. Los Angeles
  8. Austin, Tex.
  9. Stockholm
  10. Copenhagen, Denmark

Source: Savills

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2018 an Active Year  for Spain’s Market

Last year marked the busiest in a decade for Spain’s property market. The annual aggregate investment volume in commercial assets was 11.63 billion euros, an increase of 8 percent from 2017. Figures by asset class included:

BNP Paribas Real Estate notes that the decrease in office volume was due to the scarcity of office product and fewer deals in 2018 than 2017.

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Global Markets to Watch

Global capital flows continue to grow, with 97 percent of respondents to Deloitte’s “2019 Commercial Real Estate Outlook” planning to increase capital commitments in the next 18 months. Investors in the United States and Germany plan to increase commitments by 13 percent in that window, with parties in Canada (12 percent), China (12 percent), and Hong Kong (12 percent) also feeling optimistic. Mixed-use properties will see the biggest jump in investment at 14 percent, followed by nontraditional at 13 percent.

Source: Deloitte, “2019 Commercial Real Estate Outlook”