Sustainability practices offer commercial real estate a triple bottom line — one that is concerned with economic, social, and environmental performance.
Tokyo's Big Deal
Japan Hotel REIT Investment Corp. purchased the Hilton Tokyo Odaiba for more than $560 million. The hotel was owned by Japanese developer Hulic Co. Ltd and Fuyo General Lease, who acquired the property for $541 million in January 2018. The 15-story, 453-room hotel is in Odaiba, a man-made island in Tokyo Bay, 10 miles from Tokyo International Airport. Features include a 12,917-square-foot ballroom, two wedding chapels, and a variety of restaurants. The hotel, built in 1996 as the Hotel Nikko Tokyo, was converted and rebranded as the Hilton Tokyo Odaiba in 2015. The REIT now has 43 hotels in its portfolio.
Sources: Japan Hotel REIT, Commercial Property Executive
Flexible Office Space Demand on the Rise in Europe
Workthere, a business created by Savills to help clients find flexible office space, notes that flexible office space take-up increased by 20 percent year over year across 20 European cities. The company noted that several smaller “second cities” are poised for an increase in demand for flexible office space in 2019 and 2020 based on factors such as economic growth, job creation, innovation, and property market fundamentals.
Emerging Indian Markets
Investors ranked Pune, India, in the west-central state of Maharashtra, as top among emerging office markets in the country. The top three cities include:
18-Story Wooden Building Claims World Title
The world's tallest wooden building opened in March in Brumunddal, Norway. The 18-story, 280-foot Mjösa Tower contains office space, a hotel, and residential units. The load-bearing structure comprises of glulam columns, beams, and diagonal members. The first 10 floors are made of prefabricated wood elements, while the upper-floor decks are concrete to keep the building from swaying. The developers aimed to use sustainable local wood products and local suppliers in its construction.
Source: Metsä Wood
Global Markets to Watch
Investors in the Far East are looking for safer harbors in what many see as a late-cycle market. According to CBRE's Asia Pacific Investor Intentions Survey, interest in office properties increased in 2019, to 40 percent of respondents from 34 percent the year before. Seen as a conservative sector of the market, office comes with lower management requirements with high relatively liquidity. The uptick in attention for office space comes at the expense of hotels (down to 9 percent in 2019 from 11 percent in 2018) and retail (which fell from 10 percent to 6 percent in the past two years).
Source: CBRE “Asia Pacific Investor Intentions Survey”