Real Estate

Property tie-up puts London landlords in charge

9 May 2022

Capco, owner of retail hub Covent Garden, is planning a 3.6 bln pound merger with West End neighbour Shaftesbury. Capco’s 25% stake in its larger rival helps explain the absence of a premium. If regulators approve, the main benefit will be greater bargaining power with tenants.

Adler gifts German watchdog a shot at redemption

4 May 2022

BaFin’s probe into the property group has gained added weight after KPMG’s refusal to approve its 2021 accounts. The mess is an important test for new boss Mark Branson after the regulator’s Wirecard failings. Adler’s patchy disclosure and shaky governance make it an easy target.

Capital Calls: Blackstone backs perpetual students

19 Apr 2022

Concise views on global finance: The private equity firm is buying a campus housing investment vehicle for $12.8 billion. Steady cash flows and the need for more dorms make it a nice fit for Blackstone’s permanent capital vehicles.

Bank bidders solve tricky German M&A puzzle

5 Apr 2022

Advent and Centerbridge revived their $2 bln Aareal deal by offering a 12% bump and letting rebel shareholders stay invested. It should work, defying the trend of failed German takeovers. The lesson is that debt-free deals with a flexible buyer stand the best chance of success.

Decamping auditors slam door on Chinese developers

28 Mar 2022

Shimao and Powerlong are the latest to lose PwC as the verifier of their books. It’s a little late for international examiners to be taking a stand, but mass switching to local firms will intensify scrutiny of the industry. The offshore borrowing market also should all but close.

The Covid effect: Sheds, Hong Kong, Conferences

24 Mar 2022

The pandemic continues to shape business and policy around the world. In this Viewsroom podcast, Breakingviews columnists debate a possible 21 bln euro bid for city-centre warehouses, the relaxing of restrictions in Hong Kong, and a recent conflab of M&A advisers in New Orleans.

Prologis has to go extra mile for Blackstone sheds

22 Mar 2022

The property giant offered over $23 bln for Mileway, which owns European warehouses. Sky-high valuations and frenetic M&A imply it’s a good time for Steve Schwarzman’s group to cash out. But limited city space and booming online deliveries mean asset values can keep rising.

EU housing boom risk is more social than financial

11 Mar 2022

Watchdogs in Germany and elsewhere have hiked bank capital requirements and warned property may be 30% overvalued. Yet mortgage-lending standards remain solid, suggesting pandemic savings are mainly to blame for the runup. There’s little regulators can do about wealth inequality.

UAE could be Russian oligarchs’ next playground

4 Mar 2022

Amid U.S. and European asset freezes, Moscow’s billionaires need new bases. The United Arab Emirates has international schools, a Western feel and, in Dubai, a relaxed approach to sanctioned parties. Most of all, it’s currently taking a different stance over Ukraine to the West.

Singapore slings REIT manager into big league

1 Mar 2022

A $7 bln merger of property trusts run by state-backed Mapletree has been attacked over price and rationale. Both sides have cause to be wary, although increased heft entails lower funding costs, plus prestige for the fund’s manager. Investors, however, end up with less choice.

Capital Calls: Theme park M&A, Energy IPO

16 Feb 2022

Concise views on global finance: Cedar Fair rebuffed a takeover offer from rival amusement park operator SeaWorld, but other buyers may be reluctant to join the ride; The $8 bln Vaar Energi, majority owned by Italy’s Eni, sees its shares dip on their first day of trading.

Capital Calls: ABB’s car chargers, Airport M&A

10 Feb 2022

Concise views on global finance: The Swiss engineering group’s listing plans come at an unfortunate moment; Britain’s John Menzies takes a risk with rejection of “opportunistic” approach from Kuwaiti air services group NAS.

Irish housing bind opens door to radical options

31 Jan 2022

The cost of renting in Ireland has soared, but so has the cost of buying a home. Regulatory reluctance to relax bank lending standards means demand won’t rise to help stimulate new supply. The impasse makes it more likely that leftist Sinn Féin may win the next election.

Capital Calls: Blackstone, German chips, Guy Hands

27 Jan 2022

Concise views on global finance: The $140 bln group braces for falling asset values and rising interest rates; Berlin sends the wrong signal by ignoring a 4.4 bln euro offer for wafer maker Siltronic; Britain seeks to reverse the financier’s lucrative 1996 housing deal.

Capital Calls: UK housebuilder tumble

13 Jan 2022

Concise views on global finance: Countryside Properties shares fell as much as 26% after it failed to capitalise on a UK housing boom.

Shop spree will stuff landlords in bargain bin

6 Jan 2022

Ikea and Amazon are among the many retailers opening new locations. In theory, it’s a good sign for mall owners like Unibail-Rodamco-Westfield, which trade at steep discounts to their assets. Cheap rents and other freebies, however, mean they’re effectively giving away the store.

Selfridges’ buyer has hedge against retail risks

24 Dec 2021

Thailand’s Central Group and Austria’s Signa are paying a pricey $5 bln to acquire the department store group. With the future of retail uncertain post-pandemic, they’re taking a risk. Yet the scale of that punt is reduced by the fact this is also a prime real estate deal.

Elliott picks low-hanging fruit with builder punt

15 Dec 2021

After a bruising battle at utility SSE, the activist is targeting British housebuilder Taylor Wimpey. Its demands are modest and its criticisms a little overdone. Still, the $8 bln company’s lacklustre shares mean other investors should back Elliott’s call for an external CEO.

German $2 bln buyout flags bank investor myopia

23 Nov 2021

Advent and Centerbridge agreed to buy Aareal Bank, a real-estate lender that also owns an IT business. They could churn out a good return with a breakup or just by investing in the business rather than paying dividends. Payout-hungry shareholders in other banks should take note.

Chancellor: China’s economic miracle is ending

11 Nov 2021

President Xi Jinping wants to deflate the housing bubble and deleverage the economy while maintaining high growth rates. But every country that, like China, adopted the so-called Asian development model eventually faced a crisis. There is no easy way for China to avoid one.