Real Estate News

REAL ESTATE: Foreclosures continue to dominate Inland home sales

2012-01-26T22:26:00.001-08:00

Foreclosures continued to dominate Inland Southern California home sales in the third quarter of 2011, with 51.87 percent of homes sold either in the foreclosure process or already foreclosed on and bank owned, according to data released this week by RealtyTrac, an Irvine-based foreclosure monitoring firm.

Because of the strong influence of foreclosures on the rest of the Inland Southern California housing market, the price discount home buyers got for buying foreclosures in the Riverside-San Bernardino-Ontario metropolitan area was less than for other parts of the nation, said RealtyTrac spokesman Daren Blomquist. He said the 18.88 percent average foreclosure discount in Inland Southern California was the 34{+t}{+h} lowest foreclosure discount found in 176 metropolitan areas that RealtyTrac compared in its third quarter report.

According to RealtyTrac 11,950 homes in the foreclosure process or bank-owned were sold in the Inland metropolitan area in the third quarter at an average price of $173,461. That was 2.6 percent fewer homes sold in this distress category than a year earlier.

By contrast, nationally homes in foreclosure or bank owned constituted 20 percent of all sales, which was sharp drop from 30 percent in the third quarter of 2010. The average price was $165,322 and the average foreclosure price discount was about 34 percent. Blomquist attributed the national drop in foreclosure sales to delays stemming from regulatory concerns, particularly in states that, unlike California, initiate foreclosures in the courts.

Because foreclosures need to work through the system before the housing market can heal, “In the long term it will be better that the Inland Empire is disposing of these properties more quickly,” Blomquist said.

Source: http://www.pe.com/business/business-insider-headlines/20120126-real-estate-foreclosures-continue-to-dominate-inland-home-sales.ece

2011 ‘difficult year for UAE real estate investors'

2012-01-24T01:45:00.000-08:00

DUBAI: Jones Lang LaSalle, the world's leading real estate investment and advisory firm, has released its "Top Trends for UAE Real Estate in 2012".

This is the fifth year that Jones Lang LaSalle has published its keynote research anticipating the major trends affecting and shaping the UAE real estate sector.

Alan Robertson, CEO, Jones Lang LaSalle MENA, said: "2011 was a difficult year for real estate investors with most sectors of the market moving in the favor of tenants, with lower prices and rentals.”

Robertson added: “While these trends appear likely to continue into 2012, the main trend for this year is likely to be an increasing polarization within each sector of the market. As the performance of the best quality projects will improve, average prices are expected to decline further in 2012 within this increasingly two-tier market.”

Beyond investment valuations and rentals, we are continuing to see the evolution of a more mature marketplace in the UAE where valuations and property and asset management, will becoming increasingly important for occupiers, developers and investors.

The local real estate market will continue be impacted by regional and global events during 2012 as, the UAE is not immune from the on-going impact of the Arab Spring and the economic troubles of the euro zone.

“As we enter 2012, the real estate sector will inevitably be susceptible to any potential geo-political changes within the region, with the recent escalation of rhetoric between Iran and the West being the major cause of uncertainty. The worsening European debt crises and its impact on the global economy will be the other major external challenge to the UAE real estate market in 2012," Robertson said.

In publishing its 2012 report, Jones Lang LaSalle believes the following will be the key trends for the UAE's real estate sector over the next twelve months:

• More realism: The UAE real estate sector will generally see more realism in 2012. With consolidation and rationalization of projects, there will be more focus toward customer requirements and long-term commercial viability. In 2012, affordability will be to housing what budget hotels will be to the hospitality market. Banks are also expected to continue their more selective approach toward lending criteria.

• More choice: There will be more choice for occupiers and tenants in 2012. With significant levels of supply inflow in many sectors, the market is expected to increase in competitiveness which will lead to a wider spectrum of choices for tenants and occupiers this year.

• More sustainability: Globally there is increased evidence that green buildings have a superior financial performance to others. Despite an increased awareness of the importance of sustainability within the UAE there remain few LEED certified projects. There is likely to be further green measures introduced but sustainability is not likely to be a real game changer in 2012 as the market will remain concerned with more pressing short-term issues.

• More management: The quality of estate management will be one of the factors determining winners and losers as it will be a critical factor in attracting tenants. There is likely to be a shift in emphasis from the management of individual assets to the management of the public areas within master planned projects in 2012

• More quality: As the flight to quality continues in 2012, there will be an emphasis on better quality projects across all sectors. There will also be a greater distinction between winners and losers as performance will vary greatly with preferred buildings outperforming others in an increasingly two-tiered market.

• More transactions: With increasing investor interest in the UAE market, a higher volume of transactions are expected in 2012, with this growth being driven by private investors and high net worth individuals rather than investment institutions. The majority of whole building sales will be in the residential sector, with a preferred asset price of AED30 - AED70 million. There will remain few sales to institutional investors as this sector remains constrained by the shortage of investment grade stock and unrealistic asking prices.

These key trends are likely to have varied implications on different sectors of the UAE real estate market:

• Office: The Abu Dhabi and Dubai office market will become more tenant friendly in 2012 as average effective rents continue to fall in both cities. Increasing realism among Abu Dhabi landlords will result in more leasing incentives offered to tenants with effective office rents falling more than in Dubai during 2012. There will also be portfolio optimization due to improved space utilization which will lead to reduced levels of required space and increased levels of sub lease space becoming available to the market.

• Residential: In 2012, the UAE residential market will be characterized by variations in performance. These conditions will result in rent and price increases in some locations while remaining stable elsewhere but depressed in some places. This varied performance will apply between buildings of the same project and also between different units within the same buildings. In Dubai, villa projects are generally expected to outperform apartments this year.

• Hospitality: The UAE hospitality market will benefit from continued investments in tourism related infrastructure like airports and airline fleet expansion in 2012. The Dubai hotel market will see improved performance while the Abu Dhabi market, which is currently some way behind the Dubai market in its cycle, will see performance stabilize after a period of decline in 2010/2011. The UAE's safe haven status will continue to be a beneficial factor for the sector during 2012.

• Retail: There may be repositioning and/or redevelopment of struggling retail centers as increasing competition continues to polarize centers into winners and losers in 2012. Poorer performing malls will need to be repositioned to remain competitive. Some mall owners may also need to consider converting shopping centers into non-retail uses.

These key trends will also have a set of implications for the UAE's major markets:

• Abu Dhabi: There is ongoing rationalization among real estate related government agencies like Aldar and Mubadala as the government rethinks its real estate agenda. Government financial support is being cut back as there is an increased emphasis on financial viability of projects across the board. This is resulting in delaying or scaling down of projects like Saadiyat Island and Capital District.

• Dubai: In 2012, the impact of the Dubai master plan and increased infrastructure spending will have a direct impact on the real estate market. The introduction and evolution of business friendly government initiatives, such as the merger of free zone authorities and amendment of foreign ownership laws will also have a direct influence on sentiment.

Craig Plumb, head of research, Jones Lang LaSalle MENA, said: "As the UAE real estate market continues to grow and evolve we will continue to see a shift in focus, with government and private sector players absorbing the new realities and characteristics of the market and rethinking their 'big picture' strategies. Financial viability will play an increasingly important role as the UAE real estate market becomes generally more realistic during 2012. Lower prices, more choice of higher quality product and its role as a regional safe haven will increase the attractiveness of the UAE market to both occupiers and investors in 2012. We can expect 'more' positive signals from this year, with some of the key words being affordable housing, budget hotels, infrastructure spending, estate management, selective stability, financial viability, new realism, tenant friendliness and sustainability across the UAE real estate market."

Source: http://arabnews.com/economy/article567260.ece

'Modest' gains in real estate market breeds optimism for 2012

2012-01-22T23:24:00.000-08:00

TRURO - Real estate sales in the northern region of Nova Scotia, including the Truro area, saw "modest but healthy gains" last year, according to the Nova Scotia Association of Realtors.

The region, which also includes New Glasgow and Amherst, saw an increase in sales of 2.6 per cent, while prices were up on average by 2.8 per cent.

"That's actually quite good growth," said Dave Uloth, regional director for the northern region, who is also a Truro realtor.

"The province is up 2.8 per cent (in actual sales) so we're right in there where we should be so most realtors would be quite happy with that."

And while challenges still exist in the industry, as with other businesses, last year's increased sales should bode well for 2012.

"I think 2012 should be a good year. I mean, with the shipbuilding contract (in Halifax) that should result in some people coming to the Truro area to buy houses," he said, because of lower prices in this area compared to the Metro region.

That should also help increase sales in cottage country areas, which have suffered in recent times, he added.

The average price of homes in this region now stands at $124,334.

Another reason to hope for an upturned market, Uloth said, is the price of mortgage rates, which are as low as 2.99 per cent at some lending institutions.

"And I mean that's excellent. Mortgage rates have never been better. So, you know, that has to stimulate the economy," he said. "I would think there's reason to be optimistic. I mean we have not gone through the same situation as the U.S. has."

The region saw a total of 3,044 homes listed last year, compared to 2,714 in 2010, an increase of 12.2 per cent.

Only two regions in the province experienced a decrease in sales in 2010, and only one had a decrease in average sale price. The Annapolis Valley region encountered a drop in sales of 4.4 per cent, with a slight decrease of one per cent in the average sale price. The Highland region sold 3.7 per cent fewer homes, with an increase of 8.3 per cent in the average sales price.

source: http://www.trurodaily.com/News/Local/2012-01-22/article-2871302/Modest-gains-in-real-estate-market-breeds-optimism-for-2012/1

REAL ESTATE LOG: Figarden project continues slowly

2012-01-19T22:40:00.000-08:00

Developer John Allen has started making street improvements along 34 acres he owns in northwest Fresno where he still plans to build a commercial retail center known as the Commons at Figarden.

But don't get too excited; construction on the much-anticipated commercial project at Gates Avenue and Figarden Drive is at least a year away.

"It's been real slow," Allen said about the development. "It seems like it's been taking forever."

Allen introduced the project in 2004 when the housing market was booming, but the recession halted plans. Housing construction slowed and recruiting tenants to new shopping centers got tougher.

While the economy hasn't improved drastically since then, Allen said it's time to get some preliminary work done.

He's installed gutters and street lights. A roundabout is being built at the Gates Avenue entrance, and the street will be extended about 300 feet.

"We've been hanging on a long time with that property and we finally decided to put improvements in and record our parcel maps," Allen said.

Home sales up, prices are still falling

More homes in Fresno and Clovis were sold in December than the month before, but prices continue to fall.

In December, 630 homes -- which include single-family homes, condominiums and planned unit developments -- were sold, compared to 567 in November, according to the Fresno Association of Realtors.

That's a small increase over December 2010 when 607 homes were sold.

The median price, however, fell to $142,500 last month from $150,000 in November.

A year ago, the median price was $152,500.

Dan Hawkins, association president, was surprised to see median home prices fall after watching them edge up by $7,000 between October and November.

He said there are still so many distressed properties out there that buyers are bargaining harder for the lowest price they can get.

Grant for affordable housing loans

The Northern California Community Loan Fund, which has an office in Fresno, received a $2 million grant from Chase Bank to provide affordable housing loans to nonprofit housing agencies.

The loans, which have affordable rates and flexible terms, will help nonprofit housing agencies in the Central Valley and San Francisco build projects.

Source: http://www.fresnobee.com/2012/01/19/2690088/figarden-project-continues-slowly.html

Fairfield County commercial real estate improves, slowly and unevenly

2012-01-18T21:54:00.000-08:00

Cushman & Wakefield, a commercial real estate firm, Tuesday released its year-end 2011 report for the Fairfield County commercial real estate market, indicating that the market is continuing in its slow but uneven recovery.

From the overall market fundamentals in 2011, Cushman & Wakefield reports:

• The potential for a double-dip recession seems to have passed;

• For the first time in three years, companies in Fairfield County are expanding;

• The vacancy level is persistently high, but is expected to slowly improve;

• Historically low interest rates have helped even poorly performing buildings continue to operate;

• The opportunity for tenants to trade lease term for rental concessions continues to expand;

• The difference in rental rates between the highest quality space and average space is growing, with pricing power going to the best-quality buildings in the marketplace.

Fairfield County's Class-A overall vacancy rate continued its upward trend, ending the year at 20.4%. This is the highest reported vacancy rate since 2002 and 63% higher than the healthy overall vacancy rate of 12.5% in 2007.

Despite the fact that Fairfield County vacancy rates seemed to have peaked in the fourth quarter, the Class-A direct average asking rental rates grew from $34.81 per square feet (psf) at year-end 2010 to the current $35.84 psf.

This increase was partially attributed to a $5.60 psf jump in Class-A direct average asking rent in the Stamford Non-CBD from $31.95 psf last year to $37.55 psf this year.

The submarket with the highest Class-A direct average asking rental rate continues to be Greenwich, registering at $54.37 psf, albeit a 28.8% drop from the $76.33 psf achieved in 2007.

Fairfield County leasing activity in 2011 for Class-A and -B combined was 2.4 million square feet (msf), 17.2% below 2010's leasing activity of 2.9 msf, but still significantly higher than the 2009 and 2008 activity of 1.8 msf and 2.1 msf, respectively.

There were six leases larger than 100,000 sf signed in 2011, compared to three in 2009 and only two in 2008.

The largest office lease of the year was Bridgewater Associates' 227,998-sf lease at 20 Westport Road (Wilton Woods Corporate Campus) in Wilton.

The largest renewal of the fourth quarter was Unilever's 108,819-sf renewal at 55 Merritt Boulevard in Trumbull.

Also completed this year was Chelsea Pier's 418,000-sf lease (376,300 sf of warehouse space and 41,700 sf of office space) and NBC Sports' 264,626-sf lease (172,566 sf of studio space and 92,060 sf of office space) at 1 Blachley Road in Stamford; Sikorsky Aircraft's 166,994-sf sublease at 1 Far Mill Crossing in Shelton; and Ryan Partnership's 104,054-sf renewal at 50 Danbury Road in Wilton. Cushman & Wakefield played a brokerage role in every transaction except the Ryan Partnership renewal.

Companies begin to expand

For the first time since mid 2008, Fairfield County companies expanded this year, which added to the improvement in leasing activity. After losing 3.6 msf (Class-A and -B) of occupied space to downsized tenants over the last three years, companies including FactSet Research Systems, GE, WR Berkley, NBC Sports, Bridgewater Associates, Sikorsky and Spinewave all expanded at one or more of their locations this year.

"Although we've seen company growth in Fairfield County in 2011, we're still only in the preliminary stages of a full market recovery," said Jim Fagan, senior managing director and market leader of Cushman & Wakefield's Fairfield and Westchester County regions. "Compared with 2009, the market is much healthier, but 2011 has certainly been a year of extreme fluctuations with vacancy levels and unemployment remaining stubbornly high. We're confident that we're well on our way to a full comeback, but there's still a long road to travel."

Overall absorption for Class-A space in Fairfield County during the fourth quarter totaled negative 29,683 sf, a dramatic decrease from last quarter's positive 119,097 sf and 4Q-10's positive 29,390 sf.

The Stamford CBD's overall vacancy rate reached 26.2% in the fourth quarter, an increase from 3Q-11's 25.8% and 4Q-10's 22.4%. This 3.8 percentage point increase from year-end 2010 to year-end 2011 is attributable to the addition of Legg Mason's 82,000 sf of sublease space at First Stamford Place; 45,906 sf of sublease space from UBS at One Stamford Forum; 23,800sf of sublease space from Statoil at 1055 Washington Boulevard; 13,043 sf of sublease space from Parexel at 750 East Main Street; 11,500 sf of sublease space from NetPerception at 1 Landmark Square; and 10,650 sf of direct space at 177 Broad Street. The Stamford CBD also has the largest contiguous availability in the county — 614,119 sf at 695 East Main Street.

Stamford's Non-CBD year-end 2011 Class-A overall vacancy rate was 26.6%, an 11.3% increase from last year's 23.9%, but an 8.3% decrease from 3Q-11's 29.0%. The Stamford Non-CBD's Class-A direct vacancy topped at 25.5% at year-end 2011 due to the 360,000 sf of vacant space added to the market by Time Warner at 290 Harbor Drive and by General Electric at 3001-3003 Summer Street.

The Greenwich Class-A overall vacancy rate has remained steady ending the year at 19.5%, in line with last year's 19.8%. Direct Class-A vacancy is at 16.3%, indicating that there's a substantial amount of sublease space on the market.

"There continues to be real opportunities in the market for tenants to either upgrade their facilities or to lower their overall occupancy costs even if the lease does not expire for several years," added Mr. Fagan. "The window for completing such tenant-favorable transactions, however, will be closing quickly as the economy improves."

Investment sales

The investment sales market also improved in 2011, with nine significant transactions (20,000 sf and above) in Fairfield County as compared with six sales in 2010 and only three in 2009. The most significant sale this quarter was 695 East Main Street in Stamford, vacant since 2009, which was sold by Lehman Holdings to Building & Land Technology in a Cushman & Wakefield arranged transaction for $30.3 million.

"With today's exceptionally low interest rates, we anticipate a much more active 2012 for the investment sales market," said Mr. Fagan. "In fact, we expect investment sales to make a much larger contribution to the overall health of the marketplace in the coming year."

Cushman & Wakefield is the world's largest privately held commercial real estate services firm. Founded in 1917, it has 235 offices in 60 countries and more than 14,000 employees. The firm represents a diverse customer base ranging from small businesses to Fortune 500 companies. It offers a complete range of services within five primary disciplines: Transaction services, including tenant and landlord representation in office, industrial and retail real estate; capital markets, including property sales, investment management, investment banking, debt and equity financing; corporate occupier & investor services, including integrated real estate strategies for large corporations and property owners; consulting services, including business and real estate consulting; and valuation & advisory, including appraisals, highest-and-best use analysis, dispute resolution and litigation support, along with specialized expertise in various industry sectors. A recognized leader in global real estate research, the firm publishes a broad array of proprietary reports available on its online Knowledge Center at cushmanwakefield.com.

Source: http://www.acorn-online.com/joomla15/theridgefieldpress/news/localnews/112250-fairfield-county-commercial-real-estate-improves-slowly-and-unevenly.html

REAL ESTATE: December Inland home sales, prices drop

2012-01-17T21:11:00.000-08:00

Buyer reluctance and tight lending standards last month continued to suppress home sales and prices in Inland Southern California, with investors and cash buyers playing an extraordinarily important role.

Home sales rose from November to December, following a normal seasonal trend. But the 3,584 homes sold in Riverside County last month was 3 percent less than in December 2010, and the median price of $194,000 — where half sold for more and half for less — also showed a 3 percent year-to-year drop.

San Bernardino County saw the biggest percent sales decline in the six-county Southern California region, a year-to-year drop of 7.2 percent to 2,418 sales in December. The median price of homes sold last month in San Bernardino County was $150,000, or 1.3 percent lower than a year earlier.

“Last year ended much the way it began, with pitifully low new-home sales, record investor activity, tight credit and lots of potential buyers and sellers just sitting tight,” said John Walsh, president of DataQuick, which on Tuesday released the December housing market figures for Southern California.

New home sales in Riverside and San Bernardino counties fell to record lows for a December, with 328 sales in Riverside County, which was almost 16 percent fewer than a year earlier, and 99 sales in San Bernardino County, down nearly 14 percent from December 2010.

Bob Yoder, Southern California division president of Shea Homes, said he has watched the drop in Inland home sales matched by a slowdown in the launching of new projects. Yoder said Shea is not planning any new communities in the Inland Empire in 2012 or 2013. For now, Shea is focusing on Orange County because that’s where job growth is occurring more quickly, he said.

The biggest barrier to stronger home sales is the anemic pace of job growth, said Chapman University economist Esmael Adibi. “Everything goes back to job creation,” he said. “Once people find jobs then household formation occurs. A kid living with parents who finds a job then needs a rental or will buy a home.”

Last month absentee buyers mostly investors but also buyers of vacation homes — accounted for a record 32.9 percent of home sales in Riverside County and a near record 34.4% of home sales in San Bernardino County. Vigorous investment activity explains in large part the concentration of sales in lower priced homes and the prevalence of all-cash purchases, analysts said.

Last month 34.9 percent of homes purchased in Riverside County and 36.4 percent of homes purchased in San Bernardino County were for cash, which is roughly double the 10-year monthly average.

“Some people think housing is where they should park their cash and some don’t have a choice because they couldn’t get a loan if they tried. And some could be retirees who are downsizing,” selling a larger house and buying a smaller one for cash, said DataQuick spokesman Andrew LePage.

Distressed properties also continued to dominate the market. Last month 61.6 percent of homes sold Riverside County and 62.6 percent in San Bernardino County were foreclosures or short sales that closed at a lower price than the existing mortgage.

Leslie Appleton-Young, chief economist for the California Association of Realtors, noted that there are multiple offers for homes priced below $300,000, many of which are foreclosures sold by banks. “If we had a greater input of distressed properties, they would sell,” she said.

But she said she believes there are prospective “buyers on the sidelines trying to time the bottom of the market” and prospective sellers waiting for a market rebound. Still, in a statement about the association’s December state housing report that also was released Tuesday Appleton-Young said home sales were slightly better in the fourth quarter than she had expected “thanks to recent improving consumer confidence and an economy that’s slowly showing signs of growth.”

Source: http://www.pe.com/business/real-estate-headlines/20120117-real-estate-december-inland-home-sales-prices-drop.ece

Hope for brighter real estate market

2012-01-16T22:23:00.001-08:00

COLLIE real estate agents can see a flickering light in a very gloomy market, but say much hangs on Yancoal’s plans for Premier Coal and where Perdaman Chemicals and Fertilisers are going with their planned urea plant.

Talks between Premier’s bosses and Perdaman Chemicals and Fertilisers have raised hopes, flattened by the breakdown in the relationship between Griffin Coal and Perdaman and their court actions.

“To be honest, in the past four to six weeks the market has been very very down,” said Charles Pinto of Summit Realty South West.

“I’ve been talking to other rep’s and they’re saying the same things as well.

“There’s a severe lack of inquiry and buyers.

“We can only push on and remain positive.”

There had been inquiry at the cheaper end of the market but investors were making ridiculous offers.

“Properties are negotiable but there is a difference between negotiating a property and stealing it,” Mr Pinto said.

“We are showing a lot of properties but people are reluctant to put offers on paper.”

However he was hopeful of an upturn soon. “In two or three months there could be more optimism in the town,” Mr Pinto said.

The breakdown in relations between Griffin Coal and Perdaman had been unfortunate. “We need some positive information on the companies,” he said.

Negotiations between Premier Coal and Perdaman were cheering but that was not the only cause for hope.

The Premier coal mine, now part of the Chinese-owned Yancoal Australia, had big plans and the char plant was only part of them.

He expected the local real market to start moving when these developments became public.

“We have a high number of listings at the moment,” he said. “We need confidence not just in the market but in the town itself.

“If Yancoal is successful with Perdaman – and they are talking much bigger stuff as well, they have big plans for the future – things will really start to happen.”

Harley Johnston of Western Districts Realty said he “did not want to be all gloom and doom” but real estate agents had been through a very quiet Christmas period.

“I am just starting to notice a lift in inquiries without setting any records,” he said.

“I am hoping that will transfer to a few sales.

“Some are buying but not many and there are a lot of houses on the market. We need to get a few sales in the next few weeks.”

The prices put on the Griffin Coal houses, when the mine was in the hands of receivers, had done huge damage to the local market, Mr Johnston said.

“I rang the real estate agent handling it and asked him if he knew how much damage he was doing to this market and he said ‘we have to sell them’.

“He could have sold them at a reasonable price.”

Mr Johnston had a client who tried to buy one of the Griffin properties, arguing he could not afford to dip out on such a bargain.

But Mr Johnston pointed out that the client would also have to sell his existing property at a bargain price.

Even though many of the Griffin houses were subsequently withdrawn from the market, to be relisted later at more reasonable prices, the damage had been done.

Vendors still had to be resilient as far as prices were concerned. “They must either meet the market or sit tight and wait,” he remarked.

“There is a reluctance by vendors to reduce their prices. What’s the point of reducing them further when no one is looking?”

Mandy Hassall of Century 21 Advance Realty agreed real buyers were scarce.

“Generally speaking the market is very low with people looking for bargains,” she commented.

“I am getting a bit of inquiry but offers are not realistic.

“You have a house down to $160,000 and they ask if they will take $100,000,” she reported.

There had been a little action before Christmas but not much. Still that was an improvement on earlier in 2011,” Ms Hassall said.

Mark Bateman of Southern Districts Estate Agency commented: “The whole WAmarket has been described by all the management economists as having reached the bottom.

“This suggests that broadly we are in the bottom of the cycle in WA.

“With the expectation of another two interest rate cuts – making up to four and reducing rates by one per cent – and housing prices cheap, now is a good time to get into the market.”

The change is ownership of Collie’s coal mines had made people more conservative, he said.

Like other local estate agents, he found the market very slow. But real estate sales were picking up in Bunbury and he expected that to flow through to Collie is about six months.

Source: http://www.colliemail.com.au/news/local/news/general/hope-for-brighter-real-estate-market/2422672.aspx?storypage=0

Real estate sector eyes recovery

2012-01-13T20:53:00.000-08:00

HA NOI — The domestic property market was expected to recover this year with the addition of more investment from home and abroad, as well as a looser credit policy, experts said.

The Ministry of Construction said the market would recover earlier if the Government offered a flexible credit policy in combination with flexible banking interest rates and high liquidity in capital flows to this market segment.

"The Government will loosen the credit policy for the real estate sector for the long term," said Dao Manh Hung, Head of Investment Department at the Savills Viet Nam Ltd Company, a foreign real estate consulting firm in Viet Nam, during a conference on development of the Ha Noi real estate market in the last quarter of 2011.

"In the short term, the real estate market needs foreign and domestic investment to reduce the capital shortage in banks which are the major source for capital in the local property market."

"Savills Viet Nam has promoted conferences abroad calling for investment from other countries. For example, the company organised a conference in Japan in September to attract investment to the local property market."

"The local property market is still in its early stage of development so it has great potential for foreign investment. Additionally, the real demand for property is high," Hung said.

At present, supply does not meet demand due to visible price fever on the market.

"There will be more mergers and aquisitions (M&A) among property projects this year in order to boost available capital for the projects," Hung said. "But there needs to be more transparency in the development of the M&A trend."

Nguyen Minh Tuan, deputy director and head of the Research and Consulting Department at CB Richard Ellis Viet Nam Ltd Company (CBRE), said the Government's solutions in the legal and financial systems should be synchronised.

Viet Nam's real estate market currently depended on banks for the majority of its funding, typically in the form of short term loans, while the market had not received medium and long-term capital support from funds such as the housing development fund, housing saving funds and real estate trusts funds, Tuan said.

The Government should have strict regulations to develop these funds, he said, adding that the regulations would help the funds to attract more capital.

Le Chi Hieu, chairman of Thu Duc Housing Development Company's management board said the property market would remain in difficulty until June when the market would experience better conditions due to inflation control and reduced banking interest rates.

The property market would start to recover from early 2013, Hieu said, saying the problem now was how to overcome difficulties until then.

Luong Tri Thin, chairman of Dat Xanh Group, said the firms would develop professional investment and business strategies to maintain operations and even find new development opportunities.

The Ministry of Construction reported that prices for all segments of the property market in the major cities of Ha Noi, HCM City and Da Nang, along with other provinces and cities nationwide, fell at the end of 2011. Some projects in Ha Noi offered 30 per cent reductions against earlier in the year.

The price reduction was a good sign for investors to restructure their investments and for customers with a real demand for property to enter the market, the ministry said. — VNS

Source: http://vietnamnews.vnagency.com.vn/Economy/219716/real-estate-sector-eyes-recovery.html

Commercial real estate makes slight progress in 2011

2012-01-12T21:35:00.000-08:00

THE GAZETTE Statistically, there were slight improvements in some sectors of the Colorado Springs commercial real estate market in 2011, a new report shows. Realistically, the market has a ways to go before it rebounds to where it was five to six years ago.

The combined vacancy rate for offices, shopping centers and industrial buildings — key commercial market sectors — dipped to 11.7 percent in the fourth quarter of 2011, down nearly a full percentage point from a year earlier, according to the latest report by Paul Turner of Turner Commercial Research of Colorado Springs, which tracks the commercial market.

But Turner echoed previous reports when he said the commercial market won’t see a sustained turnaround — lower vacancies and higher rents — without an improved economy.

And a stronger economy hinges on federal lawmakers tackling the nation’s debt crisis and creating a better regulatory environment on health care that would encourage businesses to add jobs, he said.

“Any hope for a foreseeable recovery of the U.S. economy depends on Washington politics,” Turner said. “Investors are not investing, banks are not lending and industry is not hiring.”

Commercial real estate is a major part of the local economy. When the market is strong, new office buildings and shopping centers employ architects, engineers and many others to get projects off the ground, while construction workers spend months on job sites. Owners of existing buildings, meanwhile, employ businesses to manage and maintain their properties, commercial brokers to market them, janitorial firms to clean them and landscapers to mow lawns and trim bushes.

Turner’s report shows the area’s office vacancy rate ended 2011 at 14.5 percent, unchanged from a year ago, but down from 16.1 percent in 2009. The latest rate was nearly double that of five years ago. The average asking price for office rents, meanwhile, declined to $10.26 per square foot — part of a steady decrease since 2007.

“Until demand picks up,” Turner’s report said, “asking rental rates will remain as a subjective starting point for effective rent negotiations.”

Fourth-quarter shopping center vacancies rose to 11.7 percent from 11.3 percent a year earlier; five years ago, the rate was 6.4 percent. Average rents, meanwhile, fell to $12.72 per square foot, from $13.37 a year ago.

Industrial building vacancies fell to 9.2 percent in the fourth quarter from 11.6 percent at the end of 2010. The decline was a bit deceiving, Turner said. The rate fell, in part, because a few big industrial spaces were filled as a result of deal involving nonprofits; Goodwill Industries is leasing space from the El Pomar Foundation, while the University of Colorado at Colorado Springs turned a building on North Nevada Avenue into an expo center.

Industrial rents averaged $6.17 per square foot, nearly unchanged from a year ago, but down about $1 from 2006.

Source: http://www.gazette.com/articles/commercial-131629-real-market.html

Real estate firm says Orlando home prices forecast to increase

2012-01-11T22:14:00.000-08:00

ORLANDO, Fla. (WOFL FOX 35) - A real estate research group reports that Orlando will lead the nation for home price increases in 2012. That's finally a bit of good news for what has been a sluggish market hit hard following the housing bubble with record foreclosures.

Orlando real estate agent Suzanne Tinkler is finishing up another 12 hour day. She is so busy listing and showing properties that she even recruited her husband out of retirement to lend her a hand.

"I'm in an office of 100 agents," said Tinkler who adds that everyone is busy. "There seems to be a surge in activity."

It wasn't surprising for Tinkler to learn that The City Beautiful home prices are forecast to jump 11.7 percent, according to California real estate firm Clear Capital. The company cites a decreasing number of foreclosures as the prime reason for its double-digit projections.

Not everyone sees such a rosy outlook for Orlando. Critics claim there is a "shadow inventory" of bank-owned properties here. These particular properties would not be listed, because they are still working their way through the court system.

Tinkler isn't buying that theory, however, based on what she has seen recently. "I think that when you go into a neighborhood, you can tell if a property is distressed, and I'm just not seeing that."

Source: http://www.myfoxorlando.com/dpp/money/011012-real-estate-firm-says-orlando-home-prices-forecast-to-increase

Real estate booms on Christchurch city fringes

2012-01-10T22:28:00.000-08:00

Districts surrounding Christchurch are booming as red-zoned residents opt for new homes out of the city.

More home building is being authorised in the Selwyn and Waimakariri districts combined than in Christchurch City, and house values in both districts are at record levels.

"We're growing rapidly. With people moving out here after the earthquakes, we're nearly back to the levels we had before the downturn," Selwyn Mayor Kelvin Coe said.

QV research director Jonno Ingerson said values in districts surrounding Christchurch had "picked up strongly" since the quakes.

Values jumped by 9.1% in Waimakariri last year, the biggest rise in New Zealand, and by 7.5% in Selwyn.

Statistics New Zealand figures show the number of consents for new homes in Waimakariri and Selwyn has doubled since a year ago, with 512 and 417 respectively issued in the 12 months to the end of November.

Christchurch consented 904 new homes in the year to the end of November, down on the previous year.

Demand for homes has pushed house prices out of the city to record levels.

Waimakariri's average price at the end of the year was $355,380, 2.6% above its 2007 peak, while Selwyn's $423,804 average was 5% above its previous peak.

Coe said the Greater Christchurch Urban Development Strategy put together by councils before the quakes had been a blessing and meant land around Selwyn's towns was already rezoned and ready for new housing.

The council had brought forward a sewerage upgrade for fast-growing Rolleston, work had begun on extending the town's water-treatment plant and its new aquatic centre would be finished this year, he said.

Rangiora real estate saleswoman Margot Hutcheon, of Bayleys, said buyers were competing for homes and multiple offers were now common.

Most buyers were from the Christchurch and Kaiapoi red zones.

"It's just supply and demand.

"Demand is very high and there's not enough properties available, and that's pushing prices up," she said.

Rising prices meant her office was selling more homes by auction or deadline sale to get owners the best price.

Some buyers had missed out after putting offers on several homes, Hutcheon said.

Christchurch house values rose by 4.3% and the average price across the city was $371,885, QV figures show.

There were small rises in most areas, including in the eastern suburbs, and values remained unchanged in the hill suburbs.

Ingerson said the Christchurch property market was still significantly disrupted by the quakes.

Further growth in values in the city depended on whether damaged properties were rezoned red or green, decisions on the redevelopment of the central city and whether there were more big quakes.

Surge in property values

Average house prices and annual growth in values:

Christchurch: $371,885 (4.35%)

East: 309,307 (3.6%)

Hills: $458,190 (0%)

Central city and north: $408,763 (4.4%)

Southwest: $368,147 (5.1%)

Waimakariri: $355,380 (9.1%)

Selwyn: $423,804 (7.5%)

Banks Peninsula: $390,823 (5.4%)

Source:http://tvnz.co.nz/national-news/real-estate-booms-christchurch-city-fringes-4682532

REAL ESTATE: More distribution activity likely in 2012

2012-01-09T22:51:00.000-08:00

The industrial real estate market turned a corner in 2011 in Inland Southern California, and there are strong signals the arrows are still pointing northward in the area’s eastern tier, thanks to renewed economic activity and a shortage of available space.

The latter part of that equation almost sounds like an echo from five years ago. There is not much available space to build a big-box distribution center near Ontario international Airport, considered the best location for a logistics facility, and there are few vacancies among existing buildings.

That means that developers are going to look east, much like they did around 2004 and 2005, when massive distribution centers were built in places such as Perris, Moreno Valley, San Bernardino and Riverside, developers say.

An end-of year report from commercial real estate company Lee & Associates found a 7.5 percent vacancy rate for industrial properties in the I-215 corridor, mostly in Riverside, Moreno Valley, Perris and surrounding areas. The vacancy rate had been more than 8 percent since 2006.

That means that 2012 could be a year to watch. If developers perceive there’s a demand for space, they could be ready to build new properties.

Three distribution centers near the city line that separates Moreno Valley and Perris are currently under construction and close to being completed. All are larger than 600,000 square feet, and all three are being built on spec, meaning they don’t have tenants yet.

“Those three big ones are like the canaries in the coal mine,” said Rick John, senior vice president of Daum Commercial Real Estate’s Ontario office. “We’re going to be watching those, and if all three are leased it’ll spring some new construction.”

Warehouse development has some detractors because it increases truck traffic, but it is probably the strongest segment of the job market in Riverside and San Bernardino counties. About 5,500 jobs related to the movement of goods were added in the last 12 months, and the growth rate of close to 5 percent is almost three times as much as the growth in all jobs, according to state data.

John Bower, the executive vice president in charge of the Inland offices of NAI Capital, said the prime locations near Ontario “are pretty well picked over.”

That means developers have no choice but to look east, and not only for the large distribution centers. Some investors are looking at facilities under 150,000 square feet, Bower said.

“We’re starting to get the next generation of developers wanting to replenish the supply in the mid-tier as well,” Bower said.

Bruce Springer, a Lee & Associates senior vice president, said it was unlikely the scenario that led to the construction of Skechers’ massive warehouse in Moreno Valley would repeat itself because that was an unusual situation. Developer Highland Fairview had Skechers lined up as its tenant early in the process. The three warehouses being built don’t have that luxury.

Also, Springer said, the market is still in the process of absorbing lender-owned properties that were given up in foreclosure proceedings, a reminder that the recession is still visible in the Inland area’s rear-view mirror.

“We’re still absorbing REOs, and that concerns me,” Springer said. “There are some great deals to be had. Unfortunately, there’s still blood coming out of the turnip.”

Source: http://www.pe.com/business/business-headlines/20120109-real-estate-more-distribution-activity-likely-in-2012.ece

Real estate market remains strong: QDAR

2012-01-08T22:33:00.000-08:00

Sales for all property types in Quinte have increased this past December compared to last year, states a report released by Quinte & District Association of Realtors.

According to the association and its MLS System (a co-operative marketing system used only by Canada's real estate boards & associations to ensure maximum exposure of properties listed for sale and impeccable accuracy of information), sales increased 13.3 per cent — going from 135 units in 2010 to 153 units in 2011. The dollar volume of those sales increased by 18.5 per cent, from $28,281,108 for December 2010 to $33,501,136 for December 2011.

"Total dollar sales volume for the month of December was 18.5 per cent stronger than December 2010," stated Doug Peterson, president of Quinte & District Association of Realtors. "Sales volume figures for the year are tracking well with a 4.5 per cent increase over 2010. Over 75 percent of the area's sales were under $250,000. The area's average sale price has increased by 6.6 per cent since 2010. This does not necessarily mean that all individual properties have increased in value."

There were 2,222 total active listings on the MLS System in the Quinte area as of December 31, 2011, of which 1,442 were residential properties. Total active listings for the year end were up 3.1 percent over 2010. All current properties can be viewed at www.quinte-MLS.com .

"The Quinte region continues to benefit from a very stable and balanced real estate market," added Peterson.

"Our area has much to be proud of. Our local real estate market is only one indicator of a strong local economy. Home and other property sales, through the MLS system, are a significant contributor to any local economy. Industry studies show that each home sale contributes approximately $40,000 in additional spending on items other than the actual house and land."

According to the end-of-year 2011 report, well-priced properties are selling quickly and buyers are advised to maintain close contact with their realtor in order to catch the best buys.

"Sellers should be aware of this consistent demand," stated Peterson. "There are still active buyers in the market. If selling is a possibility call your Realtor soon. Consult with them about the current value of your home and act quickly to get your home on the market."

Source: http://www.intelligencer.ca/ArticleDisplay.aspx?e=3428989

Commercial real estate prices stay flat in December

2012-01-06T22:34:00.000-08:00

U.S. commercial real estate values are drifting sideways after a two-year rally, analysts said.

Prices for offices, warehouses, shopping centers and apartment buildings in major cities rebounded to within 10% of their all-time high before leveling out six months ago, according to Green Street Advisors Inc.

“I think people are used to values going up or down,” analyst Peter Rothemund said, adding that it’s not abnormal for prices to be flat.

Rothemund blames the stall on a tug-of-war between investors’ desire to take advantage of low interest rates for buying real estate and their fear that the economy might falter and prevent them from making money on property.

With Europe’s financial instability, “the world is perceived to be riskier,” he said. “An economic outlook that is far more unsettled than usual is serving as an anchor.”

The Green Street property price index peaked in 2007 and hit bottom in 2008. Its latest report includes December sales figures.

Southern California office and apartment values are still weaker than most other major markets, Rothemund said. Cities including San Francisco that are home to strong business sectors such as technology are doing better at leasing up offices and driving up rents.

Apartments in general are the strongest real estate sector, with values in most markets back to peak levels.

Source: http://www.latimes.com/business/money/la-commercial-real-estate-prices-stay-flat-in-december-20120106,0,1853903.story

Real estate: 5 reasons to get a new mortgage in 2012

2012-01-05T22:37:00.000-08:00

Mortgage interest rates, near all-time lows, are likely to remain attractive throughout 2012. That means opportunities for new homebuyers and for homeowners who want to refinance.

Here are five reasons why you might want to get a new mortgage, and what you should know.

While depressed housing prices and low mortgage rates have made homes more affordable, economic uncertainty and volatile housing markets have discouraged so many homebuyers that mortgage purchase applications dropped to a 15-year low in August, the Mortgage Bankers Association reported.

In qualifying for loans, buyers face hurdles including a down payment and the ability to document at least two years of income, says Justin Lopatin, vice president of Baytree National Bank & Trust in Chicago. Income documentation can be hard for people who've suffered temporary unemployment, are self-employed or have irregular wages.

Many investors pay cash to purchase residential rental properties. But some take out a mortgage to increase their leverage, says Julie Miller, sales manager at Prospect Mortgage in Irvine, Calif.

Lopatin says low interest rates are an inducement for investment property buyers.

"If you can take out an investment loan at 4.5 percent and rent out (the property) and make a few dollars a month, annually, the return will be worth the loan," he says. "Not to mention the tax write-offs and other advantages of owning real estate."

Mortgage insurance isn't an option for investment property, so a fat down payment, typically 20 percent or more, is a must.

Investment buyers also need to show that they have enough income and reserves to afford the payments even if the tenant fails to pay the rent or moves out. Lenders typically will count 75 percent of the rent toward the borrower's income-qualifying ratios, Lopatin says. For example, a monthly rent of $1,000 would count as $750 of income.

Low rates can make rate-and-term refinancing a smart financial move. This type of new loan is exactly what the name implies: a refinance in which the interest rate or term is changed, but the loan amount stays the same.

Another benefit might be locking in a fixed interest rate instead of an adjustable rate.

Homeowners who want to refinance must provide income documentation and have a "decent" credit score, to use Miller's characterization.

Equity is also required for most loan refinance programs. This hurdle can be troublesome because homeowners don't control a property's market value, Lopatin says.

If your loan amount exceeds your home's value, consider the Home Affordable Refinance Program, or HARP, part of the federal government's Making Home Affordable initiative. If your loan is insured by the Federal Housing Administration, the FHA Short Refi program might enable you to refinance in a negative equity position.

A home equity loan or line of credit can be a good way to get cash for financial needs such as remodeling, major home repairs or financing a college education. The benefits, Lopatin says, include immediate cash, low-cost debt and potentially an income tax write-off.

There's a catch: You can't borrow against your equity if your mortgage debt exceeds your home's value.

Taking out cash isn't free money. In fact, a cash-out refinance increases your debt, which is "just not wise today," says Alfred McIntosh, principal of McIntosh Capital Advisors, a financial planning firm in Los Angeles.

Co-signing a home loan for someone might sound like a feel-good proposition. But those warm fuzzies are the only benefit to co-signing.

"I see no reason why anyone should co-sign on anything for anyone, unless it's a relative, because you're putting yourself in a position to jeopardize your credit," Lopatin says.

Miller sees "more negatives than positives" because the co-signer is equally responsible for the loan. If the borrower fails to make payments, the co-signer is on the hook.

Mortgage rates fell this week, reaching new record lows as investors seemed to ignore the latest signs of economic recovery.

The 30-year fixed-rate mortgage fell 3 basis points to 4.18 percent. A basis point is one-hundredth of 1 percentage point.

The 15-year fixed-rate fell 4 basis points to 3.4 percent. The average rate for 30-year jumbo mortgages, or generally for those of more than $417,000, fell 2 basis points to 4.62 percent.

The 5/1 ARM fell 1 basis point to 3.19 percent. With a 5/1 ARM, the rate is fixed for five years and adjusted annually thereafter.

Source: http://www.mercurynews.com/real-estate/ci_19683720

China's Property Malaise Ripples Wider

2012-01-04T22:06:00.000-08:00

BEIJING—China's property prices fell for the fourth straight month in December, adding further pressure on Chinese consumers at a time when both the domestic and global economy increasingly depend on their spending.

The property slump has triggered a slowdown in sales growth of goods ranging from furniture to refrigerators. Investment in residential real estate accounts for about 12% of China's economy, but as much as 25% is tied up in a broader category that also includes industries such as construction materials and appliances, according to economists.

The government had hoped that its efforts to rein in soaring real-estate prices would mean more Chinese would be able to buy homes, which in turn would keep demand for home furnishings humming. But the uncertainty around housing prices has scared away many new home buyers, making for a deeper-than-expected impact on the housing market and beyond. That could complicate China's efforts to manage a slowdown in its economy, which is increasingly geared toward domestic consumption at a time of declining demand from Europe and the U.S.

At a home-furnishings market recently on the eastern outskirts of Beijing, Zhang Shuangxia, a manager of closely held Canaan Furniture Co., sat on a floral couch that has gone unnoticed by her dwindling number of shoppers. "The entire shopping plaza has been empty," Ms. Zhang said.

The drop in customers, which Ms. Zhang estimated at about 50%, reflects the standstill in the housing market, she said. "If they don't buy homes, we don't sell sofas," she said.

Average housing prices in 100 major cities in China fell 0.25% in December compared with November, according to data released on Wednesday by data provider China Real Estate Index System, as the central government continues its campaign to keep housing affordable. In 31 cities across China, developers sold 134 million square meters of residential real estate from January to October of last year, down from 150 million square meters of space in the 2010 period, according to data from Standard Chartered. Sales continued to slide in November.

Consumer spending tied to the housing sector appears to be slipping too. Growth in sales of home appliances in the first 11 months of last year slid to 15% from 24% in the 2010 period, according to National Bureau of Statistics data that have been adjusted to account for inflation. Growth in furniture sales in the period slowed to 26% from 34% in 2010. The growth-rate declines were also felt in the overall retail sector.

At the furniture mart outside of Beijing, Li Wei, the manager of a store called Fashion Furniture, sells home basics such as bookcases and beds but doesn't have extras such as baby cribs and house slippers that have helped a store like IKEA shield its sales from the property slump.

Mr. Li's store had sold much of its wares to customers buying homes in a neighboring suburb called Yanjiao. But Yanjiao's fifth phase of a 50-building development is vastly unoccupied. "Our sales have plummeted," Mr. Li said.

The sluggish property market is causing investor concern about home appliance makers and retailers, said Forrest Chan, an analyst at CCB International (Holdings) Ltd, China Construction Bank's investment arm.

The stock price of Suning Appliance Co. Ltd., a Chinese appliance retailer, has dropped 35% in the past six months. Its rival GOME Electrical Appliances Holding Ltd.'s stock price fell 41% over the period, compared with a 23% drop of the Shanghai Stock Exchange Composite Index.

Suning declined to comment. A spokesman for GOME said demand for appliances is still growing in China's smaller cities, where the retailer is expanding.

Investors have already pulled back from the home-appliance sector, as government subsidies that allowed consumers to trade in their old appliances for new ones at a discount ended at the beginning of 2012, Mr. Chan said.

Some analyst say that the government's restrictions and tightening measures over the past year, such as higher mortgage down payments, to control the property market have led to a healthy price decrease. "If more middle-class Chinese can afford to buy homes, there will be more buyers of washers and refrigerators," said Wei Xiaopo, an analyst at CLSA Asia-Pacific Markets.

But Ma Yanfei, a business director at Boloni Home Décor Co., says he awaits the day people start buying again. Sales contracts are dropping at the private Beijing-based interior-decoration company. New business has dropped 30% from August, with the decline coming largely from markets like Shanghai, Hanghzhou, and Chengdu, where property markets have reacted strongly to government restrictions, Mr. Ma said.

"If it continues, we'll have to lay people off," said Mr. Ma.

Swedish furniture maker IKEA Group says its sales haven't been hurt. IKEA has protected itself from real-estate shifts by marketing itself as the go-to spot for "changes in living situations," such as new babies, house guests and seasonal changes, not just new homes, said IKEA spokeswoman Yvonne Yin.

"We haven't seen sales drop in the markets in China. On the contrary, the growth of IKEA China is positive," she said.

Source: http://online.wsj.com/article/SB10001424052970204331304577140274059333142.html?mod=WSJ_article_comments#articleTabs%3Darticle

Real estate leader

2012-01-03T21:28:00.000-08:00

New York - The United States will remain the top choice of most global commercial real estate investors in 2012, but the country has lost ground to Brazil which ranked No 2 this year, according to a survey released Sunday.

While the United States offers the most stable and secure option in commercial real estate, investors said improvement in rent and occupancy growth and the repeal of a 1980 foreign investment tax would have the strongest impact on their investment decisions, according to the 20th annual survey of Association of Foreign Investors in Real Estate (AFIRE) members.

For about the past year or so, investors in US commercial real estate have focused on gateway cities such as New York, Washington, Boston, San Francisco and Los Angeles, driving prices up and yields down.

Meanwhile commercial property in Brazil, with its bubbling economy and safer investment environment, has become a hot spot for global investors. Sao Paulo, Brazil's largest city, jumped to the fourth best city for real estate investment dollars in 2012, up from 26th place last year.

The United States is still very desirable and was second behind the UK in attracting cross-border investment in 2011, according to Real Capital Analytics preliminary figures.

"The negative is it doesn't promise a whole lot of capital appreciation because the prime markets are already fully priced," AFIRE CEO James Fetgatter said.

"By no means will Brazil replace the US, at least not in the forseeable future. Brazil is considered now a much safer place to invest and a place where you can get capital appreciation and good yield."

AFIRE'S survey respondents hold more than $874bn of real estate globally, including $338bn in the United States.

Sixty percent of respondents said they plan to increase their investment in US real estate in 2012, down from a record 72% last year, according to the 20th annual survey.

Some 42.2% said they believed the United States in 2012 would offer the best opportunity for the price of their commercial real estate investments to increase, down from 64.7% last year's survey.

The United States lost ground to Brazil, with 18.6% saying Brazil's property market offered the best growth opportunity for their investment dollars. That's up 14.2 percentage points, moving Brazil up to second place from fourth, and pushing China down to No 3, according to the AFIRE survey.

Seventy percent of respondents picked one of the three countries as their favourite, while the remaining 30% had top choices from 13 other countries on five continents.

Respondents said they would invest more in US commercial property if the fundamentals of rent and occupancy growth were stronger.

Another US barrier respondents cited was the Foreign Investment in Real Property Tax Act (FIRPTA). The 1980 act, originally designed to protect farm property from foreign ownership, subjects foreign buyers to both their domestic and US taxes when they sell their investment, unless their home country has a taxation treaty with the United States.

FIRPTA opponents have argued that the act unfairly penalises foreign investors of real estate. Such double taxation does not apply if they buy US stocks or bonds.

As for the top cities for foreign investment in 2012, New York remained No 1. London moved up to No 2 from No 3, swapping ranks with Washington. Sao Paulo was fourth, and San Francisco moved up to No 5 from No 10 last year.

Europe's sovereign debt problems and looming recession pushed most of the countries there - except for a few such as Switzerland and Poland - off the map for real estate investors. Germany lost about half its support among respondents in terms of stability and price appreciation, according to the survey.

Emerging markets also seem to be getting more popular among potential investors. Respondents identified 25 countries they would consider for investment, up from 18 last year.

Brazil topped the list, with China in second place, as each did last year. Turkey moved up to No 3 from No 7 last year. India and Vietnam each dropped down one spot, to No 3 and No 4 respectively. Appearing for the first time were Colombia, at No 10, Hungary at No 12, and Qatar at No 17.

As for US commercial real estate, respondents said that this year they would most likely invest in apartment buildings, the fourth consecutive year multifamily topped the list. Of all the types of US commercial real estate, the multifamily sector has not only recovered from the post-2007 real estate slump but rents and occupancy are even stronger than before.

Warehouse and distribution centres ranked second, up from No 5 last year. Office properties were third, up a notch from No 4. Retail properties - shopping centres and malls - slipped to No 4 from No 2. Hotels ranked No 5, down from No 3 last year.

The survey was conducted in the fourth quarter by the James A Graaskamp Center for Real Estate, Wisconsin School of Business.

Source: http://www.fin24.com/Companies/Property/Real-estate-leader-20120103

Commercial real estate market improvess

2012-01-03T21:17:00.000-08:00

Southeastern Wisconsin's commercial real estate market continues to slowly improve, according to a new survey released Tuesday by the Commercial Association of Realtors Wisconsin and Xceligent.

The area's industrial market finished 2011 with a 7.6% vacancy rate, down from 8.5% at the end of 2010, the report says.

Meanwhile, the office market vacancy rate dropped from 21.4% to 20.5%.

The worst-performing office submarket was the west side of downtown Milwaukee, with a 32.5% vacancy rate, while downtown's east side led the pack, with a vacancy rate of 15.4%.

Southeastern Wisconsin's retail market finished the year with a 6.7% vacancy rate for properties with at least 30,000 square feet. That was down from 8.2% at the end of 2010.

However, the 2011 end-year rate increased to around 13% when including properties with at least 15,000 square feet, the report says. A 2010 end-year rate for that larger inventory wasn't immediately available.

"We remain cautiously optimistic based on these positive trends that we'll see continued transaction volume growth and greater demand in 2012," said Jim Villa, association president, in a statement. "The big unknown is how the global economy, job creation and political unrest will impact the progress we are currently seeing."

Also, Grubb & Ellis Co. released its 2012 National Real Estate Forecast, which predicts a year of slow but continued growth for all commercial real estate property sectors.

The forecast expects apartments to be the best-performing sector, followed by hotels, industrial, retail and office.

Source: http://www.jsonline.com/business/market-improvement-seen-b43lmga-136631153.html

A real estate Black Friday

2012-01-02T22:29:00.000-08:00

Ask virtually any retailer if there’s excess inventory that’s sitting around taking up space, and they’ll tell you it’s better to closeout price it. That ubiquitous retail theory is playing out across the Gulf Coast’s retail real estate market, and so far its looks like its finding success.

Retail real estate has moved this year from another bottomed-out commercial real estate sector to the No. 2 spot in investor demand, behind multifamily.

WHAT’S HOT: Publix and other high-credit anchored retail centers and properties in high growth areas and city centers, such as St. Armands Circle in Sarasota.

WHAT’S NOT: Smaller unanchored properties, especially in more suburban locations.

TRANSACTION TRENDS: After a decline that started in 2008 and hit bottom in 2009, sales transactions in Tampa Bay have leveled out at more than 80 sales a quarter, according to research from the CoStar Group. Year over year, quarterly transactions have increased in all but one quarter (a tiny two-transaction decline in the most recent third quarter) since the fourth quarter of 2009.

That transaction growth is more than mirrored in Southwest Florida. Transactions are at their highest levels in at least four years, culminating with a peak of 55 transactions in the second quarter followed by the second-highest transaction level in the third quarter. Transactions have grown every quarter on a year-over-year basis since 2009.

PRICING TRENDS: Although the glass is half full, sales prices are off their peak and in one region still tumbling. In Southwest Florida, the median price per square foot hit its lowest level in four years in the second quarter at just $102.47. That marks a decline from a median price high point of $398.14 in the second quarter of 2007. Year over year, prices have declined every quarter, but one, since the first quarter of 2009.

However, the Tampa Bay region has been showing some signs of pricing improvement recently. It saw a slight increase in median square-foot prices year over year in the third quarter and early transactions recorded so far in the fourth quarter put it on track for significant growth. That follows a fairly steady year-over-year decline since the third quarter of 2008. Median square-foot prices hit their lowest level in the past six years in the first quarter, at $124.81.

“Retail is definitely firming up,” says Randy Thibaut, president of Fort Myers-based Land Solutions Inc. “When you look at retail centers like Cocoanut Point and the Mercato you’re starting to see more brand names popping up like Olive Garden. Three years ago that type of expansion just stopped. Seeing these major brand names stepping back up to the table is a great sign.”

Brokers from across the region have seen a sharp increase in retail leases this year over 2010. As an example, Dennis Dahm, director of commercial sales and leasing for Sarasota-based Michael Saunders & Co., says the firm did 30 leases in 2010 for 54,422 square feet. As of the end of November, the firm had already completed 38 retail leases for 69,533 square feet.

One of the most optimistic trends for retail comes from Brian Bern, senior director of Franklin Street Real Estate Services in Tampa. He and his staff say that class A and to a lesser extent class B retail properties are starting to fill up so much that those two products may have an inventory crunch. Bern suggests that the lack of high-quality space could translate into redevelopments and possibly even new development.

John Mounce, principal of the LandQwest Commercial, which is particularly prominent in Southwest Florida retail space, is predicting a more modest improvement for retail in 2012 — and he’s far from alone.

“Rental rates have stabilized in the anchored space,” he says. “The unanchored space is still a crapshoot. The landings gear is up, although we haven’t cleared the trees yet. We aren’t bumping along the bottom any more.”

Source: http://www.review.net/section/detail/a-real-estate-black-friday/

Dubai records land transactions worth Dh143b

2012-01-02T03:49:00.000-08:00

Dubai: Dubai Land Department has recorded 35,297 transactions worth Dh143 billion last year, a 20 per cent increase in value over 2010 records, a statement said.

The transactions include sales, mortgages, ijarah, mortgage portfolios, deferred sales and other transactions.

Sultan Butti bin Mejrin, Director General of the Land Department, said, "The transactions' quantity, quality and procedures reflect the recovery and growth of the real estate market in Dubai due to the direct support from the local government that spared no effort to achieve market's stability and growth, enhance the attractiveness of real estate investment along with boosting the confidence of investors."

Last year has seen an 12 per cent increase in mortgages compared to the value recorded in 2010. The mortgages represent 60 per cent of the total transactions conducted in 2011, this indicates the recovery of the property financing and the return of healthy activities.

Bin Mejren indicated that the total value of the transactions clearly reflect the unequivocal return of the real estate market to normal levels, the exit of speculators, the maturity of the real estate market, the increased investor awareness of the importance of long-term investment in this vital sector.

The research and survey section in the department showed that the real estate market in Dubai witnessed an overwhelming response from investors during the last year, say Bin Mejren.

This according to him "demonstrates the ability of Dubai to fully recover from the challenges of the international crisis and prove once again the strength of Dubai's economy" a statement said.

Bin Mejren stressed that the market saw a state of stability and increased demand from investors in buying properties and grasp investment opportunities in past two years. He expected that the market will see continued strong recovery in the coming period, which will encourages investors to increase their investments in Dubai real estate market due to the high levels of confidence, stability and commercial appeal it enjoys.

The 2011 transaction report issued by the Land Department indicates that the investors tend to invest more in flats through sales and mortgage that reflects the state of confidence and stability in the real estate market.

The total flats' sales and mortgages transactions rose to 26,465 worth Dh43 billion, including 20,426 flat sales' transactions were reported last year worth Dh27 billion, while 5,568 mortgage transaction worth Dh15 billion were registered in different parts of the Emirate of Dubai in 2011.

The plots' sales and mortgages amounted to Dh94 billion whereas plots' sale saw 2,961 transaction at the value of Dh22 billion, while 3,315 mortgage transactions worth Dh69 billion were registered in 2011.

Total transactions for villas in Dubai last year reached Dh6 billion. As many as 1,179 villa sales' transaction were reported last year worth Dh4 billion, while 655 mortgage transactions worth Dh2 billion were registered in different parts of Dubai in 2011.

The Dubai Land Department was established in January 1960 to provide a systematic method for registration of land and property and protect the rights of clients and ensure all legal aspects relating to the sale and purchase of land, which enabled the department to organise the registration process aimed primarily at protecting all relevant parties.

In order to organise and develop the real estate sector in the emirate Real Estate Regulatory Authority was officially established as a subsidiary of the Dubai Land Department in 2007.

Source: http://gulfnews.com/business/property/uae/dubai-records-land-transactions-worth-dh143b-1.959966

Nomura Expects 18% Rise in Condo Sales

2011-12-27T23:00:00.000-08:00

Nomura Real Estate Holdings Inc. (3231), Tokyo’s third-largest developer, plans to boost its home sales by about 18 percent next year as a drop in housing inventories signal a rebound after the March 11 earthquake.

The developer aims to sell 4,000 apartments for the year ending March 2013, up from a 3,400 target for the current business year, Kamezo Nakai, president of Nomura Real Estate, said in an interview. The company was left with 42 unsold apartments in the three months ended September, the lowest in more than four years, according to its website.

Nomura Real Estate is expecting a rebound after it sold all of the 250 units in the first phase of sales at a high-rise, 600-unit tower by Tokyo Bay earlier this month. The unit of Japan’s biggest stockbrokerage has sufficient land holdings for about 4 1/2 years of projects to supply 4,000 units annually and meet the expected demand in the coming years, Nakai said.

“Our residential business is extremely sound based on the number of inventories,” Nakai said on Dec. 27. “We have acquired plenty of landbank that will enable us to supply new apartments, depending on the market conditions.”

The company doubled the total number of apartments sold in 2010 from a year earlier and was ranked the third biggest by sales in Tokyo, according to Real Estate Economic Institute Co.

Even as it gained market share in the condominium market in Tokyo, the developer is seeking to reduce debt amid rising uncertainties in the global market.

‘Unpredictable’

“Everything is unpredictable and can change anytime,” said Nakai. “We would like to slightly decrease the size of our balance sheet and strengthen our financial structure.”

The company may cut its interest-bearing loans by about a quarter to 600 billion yen ($7.7 billion) over the next three years, said Nakai. It also aims to reduce its debt-to-equity ratio to about 1.7 times from about 2.5 times in a three-year plan that will be released in May, he said.

The developer also may set up a structure to evaluate various risks from pricing and interest rates to its projects and investments from next year, Nakai said.

The developer’s shares were unchanged at 1,124 yen in Tokyo, while the 44-member Topix Real Estate (TPREAL) Index fell 1.3 percent to 623.11, the lowest level in more than 2 1/2 years. Nomura’s shares declined 24 percent this year, compared with the 26 percent retreat of the index.

Nomura Real Estate on Oct. 28 raised its net income forecast by 15 percent to 15 billion yen for the year ending March 2012 on higher home sales, according to a statement. The company expects sales to rise 12 percent to 438 billion yen, it said.

Rebound

The expectations of a rebound next year follow a forecast for a 24 percent decline in apartment sales in the year ending March, according to the company. Sales stalled immediately after the March temblor before picking up. Nomura Real Estate also plans to expand its homebuilding business with the aim of developing 1,000 houses a year, Nakai said.

The number of apartments put up for sale in Tokyo next year may reach the highest since 2007, according to an estimate by the Real Estate Economic Institute on Dec. 20. New supply may increase 18 percent in 2012 to 53,000 units from about 45,000 units this year because of delays of sales after the quake and rising construction, it said.

Nomura Real Estate and other large builders are gaining market share as small developers struggle. Japan’s seven-biggest real estate companies, including Nomura Real Estate, took a 51 percent share of the condominium market in 2010, up from 30 percent three years earlier, according to Credit Suisse Group AG.

“Some people may think that buyers will refrain from purchasing homes after the quake, but it’s the opposite,” Nakai said. “People want to move in to apartments they deem safe.”

Source: http://www.bloomberg.com/news/2011-12-28/nomura-real-estate-expects-18-rise-in-apartment-sales-as-inventories-dip.html

Investing In Real Estate: An Overview

2011-12-26T21:54:00.000-08:00

At a time where the economy is posing challenges for everyone, investments need to be chosen carefully. Off all the investment options, real estate is the one that retains its value and pays off well in the long term.

Real estate can generate income in multiple ways and it gradually appreciates in value as well. Rental yield is the percentage of yield from monetary gains from rent. Even during inflation, the rent increases and hence the income. With increased rental property value, sale and reinvestment is easy. Also, you can obtain a higher credit from mortgaged property.For those who are not thorough with other investment vectors, real estate investments can easily work. It’s not rocket science.

The good news is, you don’t need to pay for a property from your pocket. Leveraging is one good way of acquiring assets. A house loan is the most common option.But the most popular option, thesedays, is through real estate investment trusts or REITs. Real Estate Investment Trusts acquire commercial real estates. There are financial management teams who take care of these trusts. When purchasing REIT shares, you become part owner of the properties they manage, thus, being part owner of the real estate. Imagine if the REIT owns a skyscraper. This means you are a part owner of a skyscraper as well!

Just like stocks, REITs pay dividends and you can even sell of your share when it appreciates in value. The law requires REITs to pay their investors more than 90% of their profits. For example, if you want to purchase shares in Dallas real estate , look for REI trusts that hold estates in Dallas.

Another way to make money is through flipping houses. It involves buying a house, letting it appreciate in value and selling it for a profit. This require that you have cash to buy houses. Since the price of houses are market dependent, the business is very dependent on the economy. During a boom, it’s easier to sell a house but more expensive to buy one. During a bust period, houses are a bit cheaper however; properties may sit in the market for months before someone buys from you.

If you do not have enough cash, there is buying and selling on the margin. What you do is, get a loan, buy a house, pay interest, and sell at a profit when the time is right. Since you don’t have to put in your own money, you don’t need to have that kind of a money, but you must consider the risks before jumping in. You can learn about real estate deals and processes through online realtor sites. Check online web listings for Dallas real estate and Dallas realtors or where ever you want to buy property.

Source: http://nasdaqreportnews.com/2011/12/27/investing-in-real-estate-an-overview/

How will 2012 be for property buyers?

2011-12-25T22:18:00.000-08:00

2011 was definitely a bad year for the real estate sector. Evaluate the sector on any performance indicators such as new project launch, demand or sales for the year. You will end up with same bleak picture. New project launches in the regions such as Mumbai Metropolitan and NCR (National Capital Region) went down by 60-70% as compared to previous year. And the worse, despite such low new project launches, more than half of them were remained unsold in 2011. This clearly indicates the pathetic demand environment that prevailed over the real estate sector in 2011.

There were many factors that led the whole real estate sector into such a miserable state. It starts with the stubborn inflation which remained at high levels throughout the year. Rising prices of essential goods left the consumers with less disposal income. Then, to control the inflationary waves, Reserve Bank Of India (RBI) kept on increasing the interest rates. Interest rate is one of the most important driving factors for the demand in the real estate market as most of the consumers opt for the loans to finance their purchases. Hence, rising interest rates kept the consumers away from the property markets during the year.

While inflations and interest rates were creating holes in the consumers' pockets, there was a complete uncertainty in the global economic environment. The year witnessed debt crisis in the US and many European countries such as Greece, Italy and Spain. It adversely affected the business confidence of the corporate world. In turn, this led to the job insecurities especially in the sectors such as IT (Information Technology) and Financial Services. Please note that these sectors have been the main drives for the demand growth in the real estate sector in India.

And the worse. The property prices did not witness any significant dip despite the weak demand. After the slowdown in 2008-09, the property prices have been on the rise and nearly doubled in the last two years. Consumers were expecting some corrections considering the adverse situation in the sector. However, the builders refused to do so. Even in the future, price corrections seem a totally distant thought. There exists a definite pent up demand for properties. At the same time, RBI has already paused the key rate hikes. In the future, interest rates are expected to come down. All this would boost the property demand in the future.

However, demand revival would take time. 2012 may not witness the complete revival in the sector. But there is something good expected to happen in the next year. Real Estate Regulation Bill is going to be tabled in the parliament. This bill is aimed at bringing in more accountability and transparency in land and home transactions. It would promote a healthy real estate development. It is expected that the proposed legislation would lead to better information-sharing and decision making, between real estate developers and the consumers. Besides looking at the corruption and arbitrary pricing in the sector, the real estate regulatory body would also promote affordable housing.

All this would give consumers a reason to cheer in 2012. At the same time, it may put the whole real estate sector on a definite brand new growth path.

Source: http://www.equitymaster.com/tm/tm.asp?date=12/26/2011&title=How-will-2012-be-for-property-buyers?

Real estate recovery in limbo until 2013, experts say

2011-12-23T20:47:00.000-08:00

This year was supposed to be the bottom for the housing market and 2012 was supposed to mark the turnaround. In reality, even the improvements sound like bad news, and some forecasters are saying we'll have another year of gloom before the clouds break.

"It's unlikely prices will rise next year in most markets," said Jed Kolko, chief economist at real estate information site Trulia. "By that measure most local markets will not recover next year, but prices are only one measure of how the housing market is doing."

American home values are likely to shed $681 billion this year, according to Zillow. That's better than the $1.1 trillion lost in 2010, but hardly worth breaking out the bubbly.

In a nutshell, that's the problem with the housing market today. Even the good news is relative, and a true recovery is still at least a few quarters away.

"[T]he unabsorbed pool of housing supply, dragging levels of consumer confidence, high unemployment and negative equity will continue to put downward pressure on the housing market, pushing our expectation for a potential recovery into late 2012 or early 2013," Stan Humphries, chief economist at real estate research company Zillow Inc., said in a statement.

Data company CoreLogic estimates there is a "shadow inventory" of 1.6 million homes, which is the biggest drag on prices.

"Foreclosures lead to very motivated sellers, which will have a destabilizing effect on prices," said Nicolas Retsinas, professor of real estate at Harvard Business School. The sluggish pace of foreclosures — hampered by the robo-signing scandal, ongoing investigations and litigation — have stalled the movement of those homes back into the market.

Data on the number of sales is more promising.

In November, sales of single-family homes hit a seven-month high. Sales rose 1.6 percent for the month, and 9.8 percent over the past 12 months.

But these figures are climbing back from abysmal depths; the National Association of Realtors thjs week lowered its figures on the number of homes sold between 2007 and 2010 by nearly 3 million, down to 17.7 million.

"With a highly leveraged housing bust, you haven't seen that increase in residential investment in spite of low interest rates," said Ted Gayer, a senior fellow at Brookings Institution.

Slack demand for existing homes also means fewer buyers for new homes. Home building has traditionally been the tow truck that pulls the economy out of the mud, but with so many empty houses and so few people moving into them, that's not the case this time around.

"It's not a demand problem," Gayer said. "When you have such a huge excess supply it doesn't really get at the problem."

Even though interest rates are at record lows, a tight credit market is keeping people who do want to buy on the sidelines, said Retsinas. Lower rates of household formation — fewer immigrants and more adult children still living with their parents — also quash demand.

Despite these headwinds, there are glimmers of hope. Kolko said an uptick in multifamily construction and remodeling, while not as strong as the traditional home building engine, will still provide construction-sector jobs in the near term. Longer term, more multifamily dwellings on the market will alleviate the increase in rents happening now, potentially giving people more breathing room to save for a home purchase in the future.

And a few parts of the country might catch a break next year. Kolko said California's Silicon Valley, along with much of Texas and New England, are starting to recover due to their employment levels or because the housing bubble wasn't as pronounced there in the first place. The rest of us will just have to hope for better luck in '13.

Source: http://bottomline.msnbc.msn.com/_news/2011/12/23/9659776-real-estate-recovery-in-limbo-until-2013-experts-say

Mortgage rates hit another record low

2011-12-22T21:44:00.000-08:00

NEW YORK (CNNMoney) -- Happy holidays, homebuyers! You just got a very nice present.

Mortgage rates have hit record lows, with the interest rate on a 30-year, fixed-rate loan, the most popular choice of homebuyers, averaging 3.91% this week, according to Freddie Mac's Primary Mortgage Market Survey.

That's down from 3.94% last week, and is the lowest in the 40-year history of the survey.

Rates have fallen 0.9% since the beginning of the year. For a homeowner with a $200,000 mortgage, that means a savings of $1,200 a year, said Frank Nothaft, Freddie's chief economist.

With rates at or below 4% for the last eight weeks, home sales are getting a boost, Nothaft added. Existing homes sold at their fastest pace since January last month, according to the National Association of Realtors, and new home sales edged higher in November as well

Full story

Area Real Estate Market Sees Decrease In November

2011-12-21T21:01:00.000-08:00

The local real estate market witnessed a decrease in month-over-month performance, according to statistics released Wednesday by the Multiple Listing Service of the Greater Chattanooga Association of Realtors.

In November of this year, Southeast Tennessee and the Northwest Georgia area saw the sale of 398 residential units, a 5% decrease compared to the previous month’s sales. However, local real estate leaders were encouraged by an increase in sales from the same period of 2010. That figure showed a 6.1% increase from the sale of 375 units reported at this time last year.

November’s local median home price was $125,000. That represents a decrease of 2.7% from the previous month, but matches exactly the November 2010 median price. Average Days on Market rose by 12 days from last month, and 11 days over the same period of 2010.

Foreclosure sales made through the Chattanooga Area Multiple Listing service remained fairly static at 32.2% of total transactions, and the local inventory remains at a near constant of 12.7 months’ supply.

“Without the aberrant figures of the past mid-decade, this month would not look significantly different than November does in most years,” said Jennifer Grayson, president of the local real estate association. “Nothing in our report causes me to worry about the state of the market overall, or the direction it’s heading. As the year comes to a close, I still believe that we are fortunate to live and work in an area that’s seeing real progress, and not one that’s struggling to survive. Like most people in our area, realtors have much to be thankful for this year.”

Dan Griess, president of the Chattanooga Area Multiple Listing service said that he felt the same way. “For us, consistency has been the key element of staying on a positive track.”

Mr. Griess also noted that there were recent media reports of misstated sales statistics nationally. “For the sake of our GCAR members, and in fact, everyone within the region, I want to make it abundantly clear that all of our statistical reporting is accurate and carefully vetted before we release it to the public and the media. Local citizens can read our statistics and analysis and feel the highest level of confidence that they are receiving the true picture of the home sales market in the Greater Chattanooga area.”

Source: http://www.chattanoogan.com/articles/article_215897.asp

Realty to see up to US$5bn PE exits in 2012: JLL

2011-12-20T22:47:00.000-08:00

The period between 2005 and 2008 saw a number of institutional investments by both domestic and international funds into Indian real estate

Jones Lang LaSalle has released a report entitled 'Reaping the Returns - Decoding Private Equity Real Estate Exits in India'. The report was unveiled during an exclusive media interaction during which the trend of successful PE exits in Indian real estate was discussed in detail.

PE investments in Indian real estate have penetrated deep into the industry, with both domestic and foreign funds fuelling the rapid growth of real estate construction in Indian cities. The opening up of the real estate (RE) sector for Foreign Direct Investment (FDI) in 2005 resulted in transformation of the investment sentiment in the country.

“The period between 2005 and 2008 saw a number of institutional investments by both domestic and international funds into Indian real estate,” said Anuj Puri, Chairman & Country Head, Jones Lang LaSalle India. “Most of these PE funds were calibrated to fund cycles between 5 to 7 years, which is more or less the typical inception-to-completion-cycle of a project. We are now at a stage where many of these private equity funds are monetizing their investments. This constitutes the exit phase, and the pivotal concept here is successful, optimally profitable exits.”

Private equity funds are expected to exit between $3 bn and $5 bn worth of Indian real estate investments in 2012, Jones Lang LaSalle reportedly said.

The first round of fund-raising after 2005 took place on the basis of India's macro-economic growth story in a world operating differently from before the global financial crisis. Many of the blue-chip global real estate investors then have shut offices now and many smaller, home-grown investors have become key investors in this market. The ability to successfully recover invested capital and returns will differentiate the fund managers in the next round of fund raising and also bring the spotlight on ‘investment grade’ developers.

“As advisors to domestic, foreign and listed private equity funds, lenders and developers, Jones Lang LaSalle India has successfully engineered a number of private equity exits,” says Sanjay Dutt, CEO – Business, Jones Lang LaSalle India. “This report attempts to summarize what we consider the winning strategies in the field, based on our dealings with various industry stakeholders in the industry. ”This is the right time to examine the experience of various stakeholders in the real estate private equity industry, identify the track record and chart the direction this sector is headed in.”

The report 'Reaping the Returns - Decoding Private Equity Real Estate Exits in India' aims to gain and share a perspective on a PE fund’s exit proposition in context with the Indian real estate industry. This thought piece touches upon the Who, Where, When, Why and How of the investment and exit strategies of the PE funds as empirically observed over the last 6 years.

Source: http://www.indiainfoline.com/Markets/News/Realty-to-see-up-to-US-dollar-5bn-PE-exits-in-2012-JLL/5317057130