20,000 delegates from over 80 countries, including 4,300 international real estate investors, are expected in Cannes on March 12, to attend the annual gathering of the world's real estate industry, Mipim. And in the run-up to the exhibition, a series of industry and economic outlook reports suggested that 2013 could well be the year when the global economy picks up again, with positive repercussions for international real estate.
Moving from stagnation to growth
In Cushman & Wakefield's Economic Pulse Forecast 2013, Chief Economist Ken McCarthy reported, "While 2013 will get off to a slow start, we believe the stage has been set for a significant turnup late in the year and a strong global rebound in 2014 and beyond." The report went on to say, "In general, the (real estate) market outlook is for stabilization, followed by improvement in most of Europe as the regional economy moves from stagnation to growth; modest improvement in the Americas led by strength in Latin America and slow improvement in the United States; and healthy growth in Asia, but below the pace of recent years."
Obviously the economic situation varies according to regions. In Europe, it even varies between the southern and northern countries. And if economic growth in Asia is slowing slightly, it is still at a level that Europe or North America can currently only dream about! The advantage of Mipim is that with over 80 countries represented, we provide a huge portfolio of investment opportunities depending on the strategy of individual investment companies.
Reflection of Strong German Market
Mipim 2013 will see the presence of delegations from countries that have been at the heart of the event since its launch, many of which host prime assets. These include Germany, the United Kingdom, France, Italy, Sweden and the United States. We also see a growth in attend ance from high development countries like Russia, Turkey (Country of Honour in 2013), China and Brazil. These countries are showcasing major real estate projects and offer new opportunities for investors who are looking to diversify their portfolios.
For the moment, it appears that prime locations continue to head up most investment strategy agendas, although a report from PricewaterhouseCoopers (PwC) and the Urban Land Institute (ULI) suggests "What is distinct about 2013 is investors' willingness to take on slightly more risk." In PwC/ULI's survey of European real estate, Germany has three cities (Munich, Berlin and Hamburg) in the top five list of city investment prospects, with London and Istanbul completing the list. The report identifies Munich's low unemployment and strong service-based economy as being attractive for investors. Berlin scores highly for its young population, ability to attract tech start-ups and available retail locations. As for Hamburg, its stability, as well as a rise in warehouse and logistics activity connected to the port, is drawing investor attention.
Turkey Country of Honour
The German market has always been well represented at Mipim, with the likes of Berlin, Munich, Hamburg, Stuttgart, Cologne, Düsseldorf, Dortmund or Frankfurt all very active on the exhibition floor. With Germany seen to be taking the lead in the post-2008 Eurozone meltdown, one of the high points will be the keynote speech by leading German economist and former member of the executive board of the European Central Bank, Dr. Jürgen Stark. He'll be addressing delegates on the state of the financial crisis in Europe and how member states can pull themselves out of the crisis.
Following on the footsteps of Germany in 2012, Turkey takes centre stage in 2013 as Country of Honour. Last year, the Turkish government adopted legislation designed to stimulate foreign investment and the PwC/ULI survey of emerging trends in European real estate identifies Istanbul as a major opportunity for investors, with retail thriving, tourism performing strongly. Industry estimates are that real estate investment in Istanbul and beyond will rise by 3.7 billion Euro a year following the government's action. With a new 1,000 square metres Turkish Pavilion, a dedicated conference programme on Turkish investment opportunities and the presence of the country's Deputy Prime Minister, Ali Babacan, alongside Mayor of Istanbul, Kadir Topbas¸, Turkey is set to make its growing presence in the international real estate market well and truly felt in Cannes.
Four specific areas will receive particular attention within the overall programme - investment, building innovation, industrial and logistics and city and urban development. Returning to Cannes, this year's RE-Invest Summit will focus on "Real estate strategies: Navigating through the uncertainty. Managing risks and opportunities against global economic headwinds." In addition, the conference programme will include national investment opportunities ranging from the United States to Brazil, by way of Asia and the Middle East. As companies begin to accept more risks and start looking beyond the core markets, understanding the specificities of regional or local markets is becoming increasingly important, hence the broad scope of the conference programme.
With end-users now insisting on the highest sustainable credentials for their buildings and urban planners doing likewise for their town and cities, innovation is now a buzz word within the property business. The 1,000 square metres Innovation Factory will explore futuristic concepts using towers built from Lego, hear award-winning German architect Jürgen Mayer. He discuss latest trends in building and get feedback from end-user associations on what they expect from the buildings of today and tomorrow.
Four Areas for Growth
March 13 will see some 80 mayors and senior city administrators, including Mayor of London, Boris Johnson, come together for the closed-door Mayors' Think Tank, dedicated to trying to understand how the attractiveness and competitiveness of cities can be measured. Cities drive urban regeneration and development which is why so many are represented in the exhibition halls. Mipim provides a platform for presenting ambitious urban projects and a forum for debating important urban policy issues.
According to data from Forrester Research, global e-commerce in Europe will be worth 184 billion US-dollars in 2015, leading to a profound change in the logistics sector, as demand for warehouse space rises in line with e-retailing business. To track the trends in industrial and logistics real estate, Mipim delegates will have access to a Logistics Pavilion bringing together logistics prop erty developers, corporate occupiers, city officials and a host of industry experts who will share their experience.
With the traditionally strong commitment to serving the investment community, the ability to bring together major international cities, the commitment to promoting innovation and sustainability and the growing presence of the logistics sector, Mipim 2013 covers the complete value-chain of the international real estate industry.