Real Estate

China’s property debt red lines need a redraw

11 Jan 2023

The policy Beijing introduced in 2020 to cap developers' leverage is backfiring. The “three red lines” on debt ratios are now aggravating market stress and impairing balance sheets. Officials are considering blurring or moving the lines. They might have to erase them.

Blackstone’s clever REIT deal punts big question

4 Jan 2023

A $4 bln investment in its real-estate fund shows Blackstone can pull in big-name money on good terms for itself. It doesn’t, though, prove the fund’s assets are worth what they claim to be. Steve Schwarzman’s firm has firepower aplenty, but hasn’t answered valuation qualms.

Singapore withstands a global property downturn

3 Jan 2023

The Lion City’s housing prices are up 14% in a year, compared to declines in Hong Kong and other major cities. A pandemic-induced construction shortfall and increasing foreign demand are factors. Rising interest rates will cool, but not halt, Singapore’s real estate boom.

New shareholder ballots win vote of confidence

20 Dec 2022

In the first election under rules enabling votes for both company and dissident board nominees, investors at $5 bln apartment owner Aimco chose a split ticket. Victory for one of activist Jonathan Litt’s two candidates augurs more compromise – and power for proxy firms like ISS.

China property gets $650 mln vote of no confidence

13 Dec 2022

Controlling shareholder Yang Huiyan is shedding 7% of Country Garden's services arm, a first. She doesn’t seem to need the money given state support for the developer, and it’s an odd time to sell. It suggests deep scepticism about Beijing’s real estate rescue package.

The implications of Blackstone’s property wobble

8 Dec 2022

The giant alternative asset manager’s market value dropped by $8 bln after it said investors were exiting its flagship real estate fund. In this Viewsroom podcast, Breakingviews columnists discuss the causes of the jitters and how rivals are vulnerable to similar moves.

Blackstone feeds private-market valuation fears

1 Dec 2022

The buyout shop is limiting redemptions from a $125 bln real estate fund after investors flooded it with requests, echoing a broader selloff in publicly traded peers. Limiting withdrawals risks a dangerous feedback loop. And a profitable Las Vegas deal offers limited reassurance.

Blackstone mall IPO puts wealthy India on display

1 Dec 2022

Brands like Zara suffer from a dearth of quality shopping centres like those the asset manager is floating. Its portfolio boasts high occupancy rates in both posh and up-and-coming locations. Owners collect rent plus a share of revenue. That’s compelling as the rich get richer.

Airbnb has promise as the quasi-immobility firm

30 Nov 2022

The $60 bln home-sharing platform will list big landlords’ apartments so tenants can sublet them out on its app. Like its regular offering, this may draw local ire. But giving old-world property giants a way to benefit from transient post-pandemic lifestyles is a neat innovation.

China property bailouts leave most out in the cold

30 Nov 2022

Beijing is letting homebuilders use equity financing again, and state banks extended $220 bln in new credit lines. But policymakers want to avoid propping up the whole market, so only a handful of developers passed the test. The rest face more stress – as do foreign bondholders.

Capital Calls: Funky debt shock

29 Nov 2022

Concise views on global finance: Germany property group Aroundtown won’t be the last to flout bond market convention on hybrid debt.

U.S. housing faces longer descent to basement

22 Nov 2022

With mortgages near 7%, homebuyers are staying on the sidelines. Higher interest rates will be around for a while, though. Incentives from builders such as D.R. Horton help, but it will take significant price declines from the $471,000 median before the market picks up again.

Hybrid working is wild card in office slump

21 Nov 2022

Workspace landlords like British Land and France’s Gecina are facing a storm. Higher interest rates are cutting property values, just as a weak economy pushes up vacancy rates. And, with UK workers spending half their week at home, employers have plenty of scope to cull space.

China’s property easing is minor capitulation

14 Nov 2022

Beijing has rolled out quick-fix measures like extending repayment periods to avert defaults and lowering mortgage down-payments, a signal that officials are sticking to their guns on deleveraging despite economic stress. That makes boosting the rest of the economy more urgent.

Tech mess hastens Irish economic turn inwards

11 Nov 2022

Multinationals like Meta Platforms bring in a quarter of Ireland’s $68 bln tax revenue, and the salaries they pay prop up its housing market. Now they’re shedding staff, the risk is a budget hole. Irish business may not like how a future Sinn Féin government would fill it.

The urgent search for the perfect inflation hedge

20 Oct 2022

Nearly every major asset class has lost money this year, leaving investors scrambling to protect their wealth from rising prices. Traditional alternatives such as gold and property also have drawbacks, writes Edward Chancellor. The best shield may be the most obvious one.

Bank mortgage tweaks presage bigger political hit

14 Oct 2022

Spain’s CaixaBank proposed a rate freeze, while UK lenders favour ad hoc relief for struggling borrowers. As interest costs soar, these won’t be enough to avoid a mess. Since cash-strapped governments can’t help, they may hammer banks with Polish-style blanket payment holidays.

Realtor complex has beat ’em or join ’em moment

11 Oct 2022

There are 1.5 million U.S. realtors, but only half that many dwellings on the market. Amid rising rates and falling values, that bodes poorly for the industry. Companies like Redfin, Compass, Re/Max and Zillow are at an inflection point: The town isn’t big enough for all of them.

Blackstone converts Indian property to safe haven

6 Oct 2022

A $500 mln shopping mall listing would lay another cornerstone in the U.S. titan’s push to build a local market for REITs. Their decent returns and scarcity value in India can put a good roof over long-term investors’ heads. That’s all the more enticing given global volatility.

Canary Wharf’s post-pandemic property conundrum

4 Oct 2022

The east London financial hub’s owner is expanding even as tenants like HSBC consider ditching their leases. In this Exchange podcast, CEO Shobi Khan explains how renting out swanky apartments and luring a new breed of tenant can insulate the landlord from a property slump.