Real Estate

The UK house price bubble never existed

12 Dec 2005

UK property prices will end the year higher than at the start, confounding those who predicted a crash in 2005. Why did people get it wrong? Perhaps because they failed to take account of the substantial shift in the longterm equilibrium level of house prices to earnings.

Karstadt’s real estate sell-off improves nothing

9 Dec 2005

The German retailer wants to sell and lease back stores to repay all its debt. The reasoning? Karstadt would then be debtfree. But this isn't logical. Karstadt would simply have turned financial debt into lease obligations. That doesn t change the economics at all.

British Land disposals signal further break with past

24 Nov 2005

The UK property company s decision to sell two key properties shows CEO Hester is serious about more actively managing the portfolio. Combined with strong rental growth in retail and City offices, British Land will continue to perform even if yields stop falling.

Rising rents rescue the UK house market

10 Oct 2005

Well that was the slump that didn t happen. After a spring lull, UK house prices have started to rise again. Higher rents may help explain why. They ve supported the marginal UK house buyer current and prospective buytolet investors.

Hammerson shrugs off retail downturn

30 Aug 2005

The UK property group has posted an impressive 8% rise in rental income at a time when its core retail customer base is struggling. Now that property investors can't rely on easy gains from falling interest rates, Hammerson s performance is particularly encouraging.

Hester stamps his authority on British Land

23 May 2005

The British Land boss is buying Pillar Property not just for its retail parks and fund management business but also its management team. He hopes they will spearhead a cultural change at British Land, but he will have to sweat to make the £811m deal work.

Metrovacesa bids for E5.5bn French rival

15 Mar 2005

At first glance, this looks amazingly ballsy. The Spanish property company is bidding cash for Gecina, which is twice its size. But it's not so big a bite. Gecina's REIT status gives the Spanish the tax benefits of full ownership without buying the whole company.

UK property companies could enjoy a premium

30 Jan 2005

Traditionally, they ve traded at a big discount to net asset value. That has already shrunk. But the probable launch of real estate investment trusts could justify a premium. That is what happened in Europe and the US.

Foreign investors pile into German property

16 Dec 2004

The big residential portfolios companies and municipalities are selling generate stable cash flows and can be geared aggressively. The odd thing is that German investors have stood aside so far. It's not clear why but it's allowing foreigners to make hay.

UK housing soft spot continues

4 Nov 2004

October's fall in house prices brings them back almost to June's level. This could be a rational response to higher borrowing costs. Hopes for a soft landing are, understandably, mounting. But a crash or even a renewed boom is still quite possible.

Is Brascan trying greenmail over Canary Wharf?

3 Jun 2004

The Canadian group has bought more shares in the skyscraper complex after it has lost the bid battle to Morgan Stanley. Brascan looks like it is trying to be such an irritation that Morgan Stanley will eventually pay it a premium to go away.

Spanish IPO revival off to a good start

30 Apr 2004

Technical glitches delayed the debut of Fadesa, Spain s first IPO in nearly two years. That didn't stop shares from rising, even if they don't look too cheap. Telecinco, due to list this summer, looks to have an easy ride. Fadesa, Spain's first IPO in nearly two years had a successful debut despite technical glitches and a risky business model. The likes of Telecinco, due to list this summer, look to have an easy ride.

Morgan Stanley lands Canary punch

16 Apr 2004

By abandoning the requirement for 75% acceptances in its bid for the skyscrapers, Morgan has neutralised rival Brascan's only advantage. The battle for Canary Wharf has been long drawn out. But it has been profitable. The stock has risen 63% over 10 months.

Brascan outwits rival with new Wharf bid

12 Feb 2004

Although Brascan has only matched Morgan Stanley's bid, it has now assembled a shareholder pact with more than 25%. That effectively stymies Morgan Stanley's attempt to take control of Canary Wharf.

Canary Wharf gets back to back bids

5 Feb 2004

Morgan Stanley's latest bid at 275p is no knockout, but it keeps the game going. It's up to Brascan to close the bidding. The risk is that Brascan does not and Morgan Stanley fails to garner the votes it needs. Investors should sell at 276 while they can.

Chelsfield MBO is harsh but fair

26 Jan 2004

The buyout consortium has appeased the property group s independent directors by adding a smidgen more cash plus an equity piece too. But what really tipped the balance was having a big proportion of shareholders itching for an exit.

Canary Wharf may accept new bid

4 Dec 2003

Morgan Stanley/Glick's 265p a share bid only represents a measly 4% improvement from its original offer. Why the change of heart? Easy they are offering an allcash alternative. For all the carping about private equity firms stealing away assets, cash is still king.

Canary Wharf brushes off bidders

12 Nov 2003

Morgan Stanley, Brascan and Reichmann are back to the drawing boards. But they are struggling to offer anything that entices investors. Now is the time for the property group to unveil its own plan for breaking up and keeping the proceeds exclusively for its own shareholders.

Canary Wharf out-bluffed

3 Nov 2003

The skyscraper complex's board doesn't seem to have done a good job in extracting an offer of only 255p a share from Morgan Stanley. It let the process drag on interminably and allowed its bluff to be called twice, if you count its chairman.

Germany is Europe’s restructuring foot-dragger

2 Oct 2003

That s the national stereotype. It also appears to be true as least on the basis of European investment banking deals, weighted by GDP. Italy and Spain, by contrast, are Europe s most avid reformers.