Real Estate

Chinese homebuilders see no light at end of tunnel

9 Aug 2023

The property crisis is claiming one of the few big developers left standing. Country Garden might dodge a default but slowing sales make honouring $200 bln of liabilities and building 1 mln apartments hard. Beijing is pushing firms to the brink, and they have reason to push back.

GIC’s real estate safe haven is hard to copy

26 Jul 2023

Singapore’s $690 bln sovereign fund nearly doubled its real estate allocations to 13% in three years. Its student homes to logistics portfolio provides a timely inflation hedge for one of the most active investors in its class. Peers trying to catch up will overpay.

China’s stimulus tone hits a high pitch

25 Jul 2023

Party leaders are finally admitting they need to do more to support the $18 trln economy and its real estate market. Some fiscal tweaks and measures to speed home sales in big cities may follow. But in raising expectations, what Beijing considers a new normal remains a mystery.

China’s property market is finding a new normal

25 Jul 2023

Slower growth is not necessarily bad. In this Exchange podcast, Cara Li, Head of Asia Pacific Real Estate Investment Banking at Morgan Stanley, says the debt-fuelled engine of the world’s second largest economy is maturing and outlines the benefits of a period of consolidation.

How to breathe life into zombie office property

18 Jul 2023

Lenders are steering clear of buildings that face reckonings from remote working, pushing prices down. In this Exchange podcast, real estate investor Scott Rechler argues that it will take financial and civic engagement to make empty space desirable for living – and investing.

China Evergrande throws its creditors a brick

18 Jul 2023

The world’s most indebted property developer released results for 2021 and for 2022, a last-ditch move to keep its stock listing. Any resumption in the trading of its shares will also provide a clue on the value of its restructuring plan for some $20 bln of offshore debt.

China property risk rears its ugly head again

14 Jul 2023

After showing some signs of stabilising, the housing market is set to be the biggest drag on second-quarter GDP. But Beijing is wary of deploying large-scale stimulus to prop up prices. The knock-on effects on consumption will be lasting and painful for the economy.

The US government needs a real estate rethink

11 Jul 2023

A proposal floating around the Senate suggests the government could solve a housing shortage by building on federal land. That's a stretch. But Uncle Sam's real estate investments are some of the worst in America, and being concentrated in one expensive city is a risk.

UK could borrow a leaf from Canada’s mortgage book

7 Jul 2023

High levels of housing debt have left British borrowers exposed to rising interest rates. One way to avoid this problem is to fix payments as a proportion of the loan. Some Canadian lenders offer such adjustable-term mortgages, Edward Chancellor writes. The UK could follow suit.

Canary Wharf faces stiff test to reinvent itself

6 Jul 2023

HSBC is quitting the financial hub and moving to smaller quarters. In this Viewsroom podcast, Breakingviews columnists discuss how hybrid working is an existential threat for commercial property and how Canary Wharf’s pivot to residential and retail may only be a partial salve.

Canary Wharf’s pivot looks like a tall order

3 Jul 2023

HSBC’s exit has set tongues wagging about the London financial hub’s demise. To thrive, its main landlord needs to manage a refinancing hump, and the estate needs a sustainable Plan B. Absent these, the Docklands may see the sort of upheaval it experienced in 1992, 2004 and 2015.

Pricey property is a pointy dilemma for Singapore

28 Jun 2023

Rich foreign arrivals including family offices are an easy scapegoat for house prices bucking a global slump. But Asia’s safe haven needs to keep the public onside more than other hubs like Hong Kong as it vies for global capital. The stakes of keeping everyone happy are high.

Capital Calls: Blackstone’s bright property sale

26 Jun 2023

Concise views on global finance: The investment firm led by Steve Schwarzman is selling a group of warehouses to Prologis for $3 bln, demonstrating that some parts of the troubled commercial real estate industry are holding up.

UK has little wiggle room on mortgage aid

21 Jun 2023

Prime Minister Rishi Sunak is under pressure to cushion the 1.7 trln pound home loans market from high interest rates. Taxpayer support would spook markets and add to the Bank of England’s inflation headache. Targeted relief from banks would do less damage – but have less impact.

Flailing property firms make for risky buyout prey

13 Jun 2023

Shares in Swedish landlord SBB crashed, while listed European peers also trade at heavily discounted valuations. It looks like a golden opportunity for private funds, with $700 bln of cash. The tough part will be securing debt financing and avoiding catching a falling knife.

Office landlords are in store for retail redux

19 May 2023

The vacancy rate for US buildings reached a 30-year high as fewer people return to work and companies cut costs. Retail owners had a similar sob story when e-commerce and a recession hit. A slowdown in building helped to boost rents. Office landlords could have a similar restart.

Center Parcs buyout would offer low thrills stay

17 May 2023

Brookfield plans to sell the British holiday park operator for up to 5 bln pounds. The company’s unique assets and brand loyalty have made it an appealing asset for private equity. But its own limits on expansion and Britain’s cost-of-living crisis may now dent returns.

Guy Hands’ misery offers bondholders a free lunch

16 May 2023

The Terra Firma owner lost a legal fight with the UK, which wants to end a controversial housing privatisation. That could force Hands to sell properties and repay 4 bln pounds of debt at a premium to its market price. It’s the kind of bet the former bond trader might have loved.

TPG returns to credit party fashionably late

15 May 2023

The buyout firm’s $3 bln purchase of direct-lending firm Angelo Gordon takes it back into a business it split off in 2020, and will make it look more like bigger peers like KKR. Missing the last private-credit wave is no bad thing, since TPG could catch the crest of the next one.

Blackstone is cautious enough with its mall IPO

4 May 2023

It has trimmed the size of a $400 mln REIT deal to list Indian shopping malls and pricing looks conservative. A successful float of a portfolio where occupancy rates are near maxed out will give the US fund something small to cheer about in a tough global real estate market.