PREVIEW
18th International Trade FairFair forfor Property andand Investment, October 5-7, 2015 17th International Trade Property Investment, October 6-8, 2014
What’s on Who to meet Where to go
Preview Magazine produced by PropertyEU for EXPO REAL
Smart cities take centre stage EXPO REAL is now in its 18th year and once again Munich is hosting three days of conferences, exhibitions and essential industry networking from October 5 to 7. As I write this, we are putting the final touches to this year’s programme, which promises some great debates and a lineup of dynamic and expert speakers, making EXPO REAL an unmissable event for the entire real estate industry. This year one focus is on urban development. During the three days we will look at the evolution of smart cities with leading experts from across Europe. We’re extremely pleased to welcome a number of ministers and mayors, including Sir Edward Lister, deputy mayor of London, and Dutch housing minister Stef Blok who will be sharing their views on city development. Europe’s future depends on the success of the innovation economy and we know these sessions will provide both insight and inspiration. So we are also delighted to have with us Günther Oettinger, European commissioner for the digital economy and society who will set out his views on what digitalisation means for the real estate industry. In particular, the huge volumes of information which are being generated need to be exploited for the common good. We all view smartphones and tablets as standard equipment and are used to keeping up-to-date via social media platforms and instant news services. But digitalisation is affecting us in other ways too. This year’s Mastermind session on Wednesday takes the theme ‘Office 4.0: the office of the future is not an office’. One of the three keynote speakers is Jason Harper, Google’s real estate project executive for EMEA, who is bound to have fascinating views on the subject. He will be joined on stage by Thomas Sattelberger who has nearly four decades of experience in management and human resources behind him, and Udo-Ernst Haner, a leading light on work innovation at the influential Fraunhofer institute in Stuttgart.
Contents Countries & Regions 7
France 6 Italy 8 UK 9 The Netherlands 12 Austria 13 Switzerland 19 Germany 20 Russia 24 CEE 25 USA 26 Urban Development special
Introduction 15 The Northern Powerhouse and the Dutch G4 16 Helsinki 17 Intelligent urbanisation 18 Sectors
Alternative investment 4 Logistics 10 Retail 22 Hospitality 27 Finance & Investment 28 General info
How to get to EXPO REAL 30
Whether your office is in a physical building, your home or completely mobile, you can keep on top of the latest EXPO REAL news via our website (www.exporeal.net) and follow the thoughts of some of the experts on our blog. The investment opportunities in Africa and innovations in logistics are among the topics currently online (blog.exporeal.net/en/). We are looking forward to welcoming you along with some 36,000 real estate professionals and nearly 1,700 exhibiting companies, countries and cities at the Messe Munchen exhibition centre in October.
Claudia Boymanns exhibition director EXPO REAL
Jason Harper (left), Thomas Sattelberger (top) and Udo-Ernst Haner will discuss digitalisation and the office of the future
EXPO REAL 2015 | 3
Sectors Alternative investment
Crowdfunding is more a communication tool than a source of finance As an investment stream crowdfunding is still in its infancy, but its potential for growth makes it one of the most exciting developments being discussed at this year’s EXPO REAL. Crowdfunding has emerged as the first viable form of online investment. Sites such as Kickstarter and Indiegogo emerged in the first decade of the 21st century, allowing private individuals to help get creative projects off the ground with a mass of small-scale contributions. As the market has matured and diversified, crowdsourcing has extended its reach to more established investments. Two projects Europe’s first crowdfunding site for property investment, Munich-based Kapitalfreunde, started up in 2012 and has so far financed two newbuild projects in Germany: a mixed-use studio and residential building in Frankfurt, and a high-end resi development in Munich, generating a total of around €200,000. The average individual investment is between €750 and €1,000, says founder Michael Ullmann, with around 5% contributing the maximum of €10,000. Ullmann, who is speaking on a panel on crowdfunding at EXPO REAL, says the value at
Act in the US three years ago, which legalised some forms of investment crowdfunding, albeit still within tight constraints. Ullmann says regulation is one of the three main challenges the sector faces.
Michael Ullmann
this early stage is not so much the amount of capital as the direct engagement it allows investors to have in the project. ‘We don’t see it so much as a pure financing tool as a communication tool,’ he says. ‘It’s a way of building up a base of supporters for your project using the principles of web 2.0: transparency, democracy and participation. You have a lively discussion that should generate the wisdom of a crowd.’ The market has only really taken off in the last few years, helped by the passing of the JOBS
Online giants The major shift will come, Ullmann believes, when the big beasts of the online and offline world, such as Google and Deutsche Bank, enter the arena. In June the New York Times reported that Goldman Sachs was setting up a peer-to-peer lending vehicle. ‘The first decade of the internet changed the media industry, the second changed retail and the expectation is that the third decade will change the financial industry, so this is a very interesting and fascinating line of business to be in,’ he says. Crowdfunding: Old wine in new bottles? Tuesday October 6 16:00 - 16:50 Planning and Partnerships Forum Hall A2 stand 040
Are property investors ready for start-ups? The start-up companies of today will be among the major economic players of tomorrow but suitable office space is at a premium. The challenges are the focus of a forum at EXPO REAL. The digital sector increased its gross value add to around €89 bn in 2013 and now tops the commercial GVA table in Germany, with a 4.7% contribution for each of the last three years. That puts it on a level footing with the automotive industry and ahead of mechanical engineering (4.5%). Companies in the TMT (technology, media and telecoms) sector accounted for one-fifth of the aggregate take-up over the last five years. ‘This development underlines the significance of the digital economy in Germany,’ says Jan Linsin, head of research at CBRE Germany who will be speaking at the EXPO REAL panel. The emergence of IT companies as a major occupier group is set to change the profile of Germany’s property market, nowhere more 4 | EXPO REAL 2015
Start-ups have specific office needs
so than in the start-up capital, Berlin. A study from the Investitionsbank Berlin (IBB) found the sector was responsible for 4.2% of the capital’s economic output in 2013, while in
the first quarter of 2015 IT firms accounted for 40% of all leasing activity. ‘Companies from the TMT sector are increasingly considered to be some of the major tenants in top locations and hotspots and to be a substantial driver of rental growth,’ says Matthias Hauff, head of agency Berlin at CBRE, in a report on Germany’s TMT sector. ‘One of the main reasons is the fast growth of those companies, which need larger office spaces rather short-term and are willing to pay more for them.’ Start-ups Tuesday October 6 15:00 - 15:50 Planning and Partnerships Forum Hall A2 stand 040
Student housing is becoming even bigger business Student housing has come a long way from basic, sparsely furnished ‘digs’. A panel discussion at EXPO REAL will focus on how the market has evolved in the last few years. The UK’s student accommodation market is the most established in Europe, with investment volumes reaching €2 bn in 2014 and growing rapidly. In a two-week spell in early 2015 some €3.5 bn of property changed own-
ership, both as portfolios and individual assets. Student accommodation in the UK has benefited from strong inward investment – around 80% of capital comes from overseas – and the arrival of institutional investors such as Canada’s CPPIB.
No more scruffy dorms. The skybar in the FIZZ Frankfurt Gallus student complex opened by International Campus AG for the new academic year
By comparison, the market in Germany is still at the embryonic stage, with total investment in 2014 of just €232 mln. Pioneering domestic investors such as Deutsche Real Estate Funds Advisor (DREF) and MPC Capital have been steadily building their portfolios, attracted by relatively high yields by German standards of up to 6% in Munich, coupled with a good risk profile. One investor with designs on the German market is Shuman Capital, which is looking to raise €200 mln for a portfolio of around 4,000 rooms across Germany, France, the Netherlands and Belgium. ‘There are a number of cities with a clear need for additional accommodation - in Germany you think of the big cities, but also internationally wellknown university cities such as Heidelberg, Freiburg and Munster,’ says chairman and managing partner Michiel Olland who is part of the EXPO REAL panel. Student Housing Tuesday October 6 14:00 - 14:50 Planning and Partnerships Forum Hall A2 stand 040
Bouwfonds IM focuses on real assets Bouwfonds IM manages a portfolio with a total value of € 6.2 billion with activities in 13 European countries and has offices in the Netherlands, Germany, France, Poland and Romania. We offer distinctive pan-European real asset investment products in the following sectors: Commercial Real Estate, Residential Real Estate, Parking, Communication Infrastructure and Agriculture. We believe our real asset niche strategy, managed by our dedicated specialized teams, offer our clients an attractive risk-adjusted return and at the same time contributes to society’s long term basic needs. Such basic needs include places to work, shop, live, park as well as the need for connecting people and food security. The right to exist for Bouwfonds IM is the willingness of investors to participate in our non-listed funds, separate mandates or joint-ventures / platforms.
Bouwfonds IM is committed to operate its fund and asset management activities in a responsible and professional manner. Since ‘real assets’ investment funds generally represent a long term investment horizon, this means that our investors can rely on Bouwfonds IM’s commitment from the beginning of the fund until closing, taking responsibility for issues arising during the full life time of the fund. Bouwfonds IM follows a transparent and standardized investment approach with an important role for research in each phase of the investment process. In-house support functions as Legal, Risk & Compliance and Finance provide the necessary checks and balances to ensure compliance with financial, reporting, legal and regulatory internal and external (AIFMD) requirements. Bouwfonds IM is signatory of the UNPRI and member of GRESB.
Jaap Gillis, CEO Bouwfonds IM
Visit our stand at Expo Real (Hall A2, 220) For more information please visit www.bouwfondsim.com EXPO REAL 2015 | 5
Countries France
France hopes you’ll join the club Professionals from across the country’s real estate sector will be showcasing their services on the new look Club France stand at this year’s EXPO REAL. ‘The EXPO REAL stand will provide a dynamic group of public sector and private companies focusing on showcasing the best real estate opportunities France has to offer,’ says Alain N’Dong of Treize Cent Treize, which is organising the Club France stand. ‘We will also be hosting three roundtable stands, one of which will include the participation of the deputy mayor of Paris, JeanLouis Missika, who is in charge of the city’s economic development town planning and architecture.’ Laure Angelin, director general of Club France exhibitor Leaseo, says France has proved itself to be a must-have investment. ‘Over the last 10 years, France has confirmed its ‘place to invest’ position in Europe with a 10-year average of €20 bn invested by French and international investors.’
Economy Another Club France participant, French listed property giant Foncière des Régions, recently announced the value of its portfolio had risen 2.1% like-for-like in the first half of 2015 and recurring net income was up 4% to €170 mln. ‘The French economy is improving and real estate fundamentals will clearly benefit from that,’ says head of corporate development and communication, Philippe Le Trung. ‘In addition, the Grand Paris future transportation network is strengthening the attractiveness of the main office locations in Paris itself.’ Jean-Louis Missika will be on hand to explain the project as he takes part in a forum on new transport and densification in growing cities on Tuesday.
Paris’ deputy mayor Jean-Louis Missika
Hall C2 stand 214 New Transport and Densification Tuesday October 6 12:30 - 13:30 Planning and Partnerships Forum Hall A2 stand 040
Paris to reinvent itself with innovative urban ideas EXPO REAL is hosting a series of seminars on cities and urban development and Paris has a key role in several of the discussions. ‘The Reinventer Paris competition for innovative urban projects is a major initiative that shows that the French real estate investment markets provides both quality products and genuine innovation,’ says Philippe Le Trung, head of corporate development and communication at property giant Foncière des Régions.
The French capital is aiming to reinvent itself and recently launched a competition for innovative urban projects. ‘Paris has to reinvent itself every moment,’ said city mayor Anne Hildalgo as the contest was announced. ‘We are launching this call for innovative urban projects in order to prefigure what the Paris of tomorrow might be.’ 6 | EXPO REAL 2015
Each team is invited to present its ideas on how to bring added vitality to exceptional Parisian sites. The winners will have the opportunity to purchase or rent the land in order to realize their projects while simultaneously conducting an urban experiment on an unparalleled scale. In total, 23 sites are up for grabs.
Air travel Paris will also be in the spotlight at a discussion on airports and urban development on Tuesday. Hubert Fontanel, the real estate deputy director of Aéroports de Paris, will be part of a panel examining which sectors and land uses are best suited to the area around an airport. The panel will consider how investment in airport districts can be optimised in ways which attract globally connected firms. Airport districts and urban development Tuesday October 6 10:00 - 10:55 Planning and Partnerships Forum Hall A2 stand 040
L’Etoile Properties goes East
Record year for French retail investment 2014 was a record year for retail investment in France, according to property advisory group CBRE, both in terms of absolute volume and as a share of total real estate investment. The country saw around €6.1 bn of investment activity, accounting for more than 27% of the total market. The exceptional level of investment was largely due to four major transactions: three portfo-
lio sales of galleries and shopping centres by Klépierre and Unibail-Rodamco, which were acquired by Carmila (a Carrefour property company) and Wereldhave, and the acquisition of the Beaugrenelle shopping centre by a consortium composed of Apsys, Madar and St James. These four accounted for three-quarters of the total retail investment volume.
Regulatory issues a driver of sales by French property owners Regulatory issues remain a serious challenge for investors in France and are prompting some property owners to become vendors, say experts ‘Investors in France need to take the new taxation convention into account. In fact, that’s why a number of investors are selling in France,’ Alfred Fink, partner at Taylor Wessing, told a PropertyEU Outlook Investment Briefing earlier this year. ‘They are getting rid of their holding companies and selling them to US companies The layers of regulation that have been added in France in recent years in the area of taxation and in the pensions fund and banking sectors are creating something of a black box, according to Marcus Cieleback, head of research at Patrizia Immobilien.
Stress test ‘The question is how will all these regulations work in the long run? Nobody is doing a stress test, but possibly there has been too much regulation,’ he said. ‘There may be attempts to fine tune things, but that’s difficult to do as long as it’s not clear yet how it all works and how things affect each other.’ Despite the challenges posed by national regulations, French investors are becoming more international, Fink says. ‘The mind set is changing, the investor community is becoming more international and we see players accompany their investors to the UK and Germany.’
French real estate adviser L’Etoile Properties, which has €3 bn of assets under management across six countries, will be reaching out to potential new clients via the Club France stand in Munich. Speaking ahead of the fair, L’Etoile Properties president Didier Unglik said: ‘L’Etoile Properties has a strong presence in France and Germany. Both markets are deep and offer a very wide range of attractive opportunities. We want to guide investors in both countries, and our presence on the Club France Stand at EXPO REAL will give us the chance to convince them.’ In March L’Etoile Properties announced the opening of an office in Seoul, South Korea. The company is aiming to provide a strategic bridge between Europe and South Korea and its Korean office will benefit from the full support of offices in France, Germany, Spain and the Netherlands. This, the company says, will ensure L’Etoile Properties can share its extensive expertise with the local investors. Hall C2 stand 214 EXPO REAL 2015 | 7
Countries Italy
‘Italy’s real estate market is in its best shape since the crisis’ Italy’s public and private sectors are coming together this year at EXPO REAL to showcase some of the largest development and investment opportunities in the country under the Invest in Italy brand. Coordinated by the real estate marketing agency Mec&Partners, Invest in Italy will bring to Munich existing exhibitors as well as new institutions such as Invest in Umbria, focused on value-add redevelopment and regeneration projects in Umbria, a region in central Italy. ‘Following last year’s success, we were happy to replicate the Invest in Italy initiative with a
Umbria is rich in investment options
stronger mix of public bodies and private companies,’ says Marco Mibelli of Mec&Partners. ‘The real estate market has never been in such good shape since the onset of the financial crisis, and the sector has performed extremely well in 2014.’ This, Mibeli says, is largely thanks to four factors: great abundance of capital, improved access to financing, historic low yields on government bonds and an interesting spread between the real estate yield and the cost of debt. EXPO REAL is the final stage of a longer project launched in March with a roadshow across cities such as Rome, Milan and Bologna. During the tour, some of the country’s largest real estate players met international institutions to discuss the main emerging trends in the local real estate market as well as the opportunities in Italy for foreign investors. The tour was sponsored by the country’s main real estate industry associations: Federimmobiliare, Assoimmobiliare, CNCC, FIAIP and Aspesi. Hall B1 stand 533
Massimo Caputi
Italy’s Prelios seeks European expansion Italian listed services firm Prelios is using its presence at EXPO REAL to reinforce its position as a European operator and its strategy to become a pure management player. Milan-based Prelios has bought 80% of Negentropy and will rebrand the business as Prelios Europe with the aim of raising foreign capital for investment in Italy. Prelios executive deputy chairman Massimo Caputi said at EXPO REAL last year that the company was looking to acquire an FCA-regulated property firm as a way of gaining a foothold in the UK market. ‘The Italian [equity] market is just too small,’ Caputi commented at the time. The company has also recently confirmed plans to spin off its investment activities in line with a strategy to reposition itself as a pure management player. Prelios manages a total of 25 funds. Hall C1 stand 220
Building on the legacy of invention
Edinburgh remains a hotbed of innovation, exploration and discovery. Today the Scottish capital is an award winning city for quality of life and foreign direct investment. Edinburgh is home to a thriving tech sector. This includes two tech start-ups valued at more than $1billion – Skyscanner and FanDuel – and Amazon chose Edinburgh for the location of their first development centre outside of North America. The city’s reputation as a great place to live helps attract and retain the talent needed to drive an innovation-based economy. While companies benefit from access to a well developed investment network and a community of entrepreneurs, The University of Edinburgh’s School of Informatics is the 8 | EXPO REAL 2015
largest informatics research centre in Europe and leads the UK in world leading research. Technology incubators (TechCube & CodeBase), new office developments (Quartermile & Tanfield), specialist science parks (Edinburgh BioQuarter) provide the infrastructure that can help nurture and grow fledging businesses. These facilities are home to a range of innovative companies and, by encouraging them to integrate with the local scientific community, facilitate a vital link between the commercial world and academic research. These reasons and the market capability are why Edinburgh is a great city for innovation
and innovators. Companies can network with lots of like-minded businesses and that sparks new ideas. To hear more about Edinburgh’s growing technology sector visit the ‘Innovation Districts: Building the Innovation Economy’ discussion on Monday 5 October from 12:00-13:00 (Intelligent Urbanisation Forum - Hall A1, Booth 432).
Countries UK
UK presence grows at EXPO REAL The UK is expanding its presence at EXPO REAL with the launch the UK and Ireland’s first pavilion at the trade fair. Representatives from some of the UK’s biggest cities, including the City of Cardiff and Manchester Airport Group, will be at the UK pavilion, along with HSBC bank and other exhibitors including architects Assael and technology company MRI Software. UK pavilion co-ordinator David Owen, managing director of Pattern, said: ‘EXPO REAL is developing from having the largest number of international visitors from the UK to growing in significance with UK based exhibitors. We are delighted to host a group stand for the first time at EXPO REAL 2015. The British Property Federation, GVA and Pattern Ltd will also host an exclusive UK networking breakfast.’ Jackie Sadek, chief executive of UK Regenera-
tion thinks UK organisations and cities are missing a trick by not participating in the show. ‘I was impressed by the display put on by cities and regions from across Europe at EXPO REAL, all promoting to German, Dutch, Russian, even American investment. I was also struck by the lack of British delegates, just a smattering of the smarter cities. You have to be at market. There is serious money here.’ Hall A2 stand 120 The UK as an investment location Wednesday October 7 11:00 - 11:50 Investment Locations Forum Hall A1, Stand 040
Glasgow is a leading conference location
Scottish cities go for economic growth through real estate regeneration Glasgow and Edinburgh are playing prominent role in the UK’s more substantial presence at EXPO REAL this year. In Glasgow the emphasis is on building 4 and 5-star hotels as the city cements its position as a conference and events location. Corporate business travellers account for 32% of hotel bookings and one in five guests is a high yield delegate. The city has also set a target of building 25,000 new homes by 2025, by releasing land and vacant buildings for residential development. An accelerated programme will make large residential sites available for private developers to build affordable homes in low-income areas such as Easterhouse and
Drumchapel. The city council’s strategy also includes plans to convert empty retail spaces into homes and a scheme to help first-time buyers access mortgage funding. In Edinburgh, the city has earmarked 12 prime sites for redevelopment, including an £850 mln mixed-use development to replace the St James Shopping Centre on Princes Street. ‘Edinburgh is a city with a strong residential core and high property values,’ says Martin Perry, director of development for project developer TIAA Henderson. Glasgow: Hall A1 stand 523 Edinburgh: Hall A1 stand 432
MAG Property flying high
MAG Property, the property and development arm of the UK’s largest owned airport operator, Manchester Airports Group, has delivered another strong financial performance, driven by increases in passenger numbers and commercial revenues. Part of the UK’s largest airport operator, MAG Property is responsible for the management and development of commercial property and development at Manchester, London Stansted, East Midlands and Bournemouth airports. Lynda Shillaw, division CEO at MAG Property, said: ‘EXPO REAL, as part of the UK and Ireland pavilion, presents a great opportunity for MAG Property to further establish our reputation on an international stage. We believe the event offers a unique opportunity to engage with Europe’s investment community.’ The group recently unveiled a ‘Manchester Airport Transformation Programme’ – a £1bn, 10-year plan that will deliver a significant upgrade of the facilities at the airport, ensuring that it continues to thrive as a national asset and play an even greater role as the ‘UK Global Gateway from the North’.
Airport Districts and urban development Tuesday October 6 10:00 - 10:55 Planning and Partnerships Forum Hall A2 stand 040 EXPO REAL 2015 | 9
Sectors
Logistics
Logistics is the ‘darling’ of the real estate industry Logistics are hot and the sector is catching up with office and retail investment. Four Special Real Estate Forum sessions on Tuesday afternoon will look at how logistics is shaping up to the challenge. Logistics is now on everyone’s ‘to buy’ list, says Malte-Maria Münchow of Deka Immobilien, who is one of the drivers behind EXPO REAL’s Let’s Talk Logistics sessions. Logistics as a sector is now closing in on office and retail investment, he says. ‘Everyone is looking for sustainable income and the
industry has learned that logistics aren’t as risky as they were once considered,’ he said, adding that transparency in the market has also improved. In Germany logistics is the third strongest sector after automotive and chemicals, with around 2.8 million people employed across
over 20 logistics hotspots. ‘Germany is the gateway to Europe from Asia,’ Münchow says. While transaction volumes are highest in the UK, it is also one of the most expensive areas. Deka Immobilien has sold four assets this year and is actively seeking new investment, but Münchow says that competition for good quality assets is very strong, especially with more overseas money coming into Europe. ‘Asian money is the driver for the aggressive yields we are now seeing in Europe.’ Flavour of the month One session in the Let’s Talk Logistics series will try to establish just why the sector is flavour of the month and ask if institutional investors should continue to target the sector. How does it perform over the long term alongside other property types, what are the major risks and what lessons can Europe learn from the United States? Let’s Talk Logistics Tuesday October 6 14:00 - 17:50 Special Real Estate Forum Hall C2 stand 240
Getting ready to debate the big issues in 2014
Creating the best-in-class European logistics fund Against the backdrop of an intensively competitive real-estate investment market, Goodman’s European flagship real estate partnership, Goodman European Logistics Fund (GELF), has led Emmanuel a dynamic growth Van der Stichele, strategy designed to Fund Manager, GELF create the highest quality logistics portfolio on the market today. Firstly, GELF committed to acquiring over one million sqm of prime logistics assets during the past two years. Of this, 62% were newly developed properties sourced from Goodman’s development business, while the 10 | EXPO REAL 2015
other 38% were market purchases. A second key element of this strategy was the successful sale of 19 assets in Germany and France, representing 479,000 sqm, in order to recycle the capital into new, high quality acquisitions. The sale has further increased the strength of the portfolio and lowered the average building age to less than seven years. Given occupier demand in low vacancy locations, GELF has also continued limited on-balance sheet developments, including speculative developments in Hamburg (Germany) and Wrocław and Kraków (Poland). Coupled with the optimisation of its debt facilities following the issuance of a wellreceived seven-year €400 million bond,
the logistics property fund has further strengthened its liquidity base whilst reducing its leverage, confirmed by strong investment grade ratings (BBB by Standard & Poor’s, Baa2 by Moody’s). With a current portfolio worth €2.2 billion, a weighted average lease expiry of 5 years and an occupancy rate of 98%, GELF will continue to strategically invest in modern logistics centres in prime locations across Europe.
www.goodman.com www.gelf.eu Hall C2 Stand 412
The impact of e-commerce
How can logistics companies gear up to deal with increasingly demanding consumer expectations such as same-day delivery? Innovation in the logistics sector and the opportunities for investors are the focus of a special session in the Let’s Talk Logistics programme organised by PropertyEU. The panel includes includes Ian Worboys, CEO of the P3 Logistics Parks, Philip Dunne, the president of Prologis Europe, Robert Dobrzycki, managing partner at Pannatoni Europe and Mo Barzegar, president of Logicor and will look at whether innovations in the supply chain create new opportunities. ‘The logistics sector has seen a transformation in terms of investor appetite over recent years,’ says moderator and PropertyEU associate publisher Richard Betts. Let’s Talk Logistics Tuesday October 6 17.00 – 17.50 Special Real Estate Forum Hall C2 stand 240
And the winner is: The most outstanding logistics real estate development of the past two years will be honoured with the 2015 Logix Award. The award is given to the project which the jury considers best distinguishes itself as an urban development project while meeting both environmental and social targets. In 2013 the winners of the Logix Award were the logistics service providers Schnellecke for a logistics facility in Duisport (Duisburg harbour) and Pfenning Logistics for their Multicube logistics center in Heddesheim. Award spokesman Jens Tosse says the Logix initiative was set up by a consortium of companies and personalities active in the logistics real estate sector. ‘It has set itself the goal of increasing the acceptance and the importance of logistics settlements among professional circles and the general public,’ he says. At the same time the Logix organisation aims to promote dialogue between stakeholders who deal with logistics properties. 2015 Logix Award Tuesday October 6 19.00 Restaurant Käfer am See By invitation only
EXPO REAL 2015 | 11
Countries The Netherlands
Holland thinks ahead in urban development Sustainable transformation one theme of the Dutch approach to this year’s EXPO REAL and cities and companies from across the country are showcasing their efforts to future proof the Netherlands. The Netherlands’ four largest cities – Amster dam, Rotterdam, The Hague and Utrecht – are increasingly working together to promote themselves on the world stage as among the most sophisticated and forward-thinking loca tions for urban development. They are joined at EXPO REAL this year by leading investors and developers such as Bouwinvest, Syntrus Achmea, BPD and ABN Amro. The second Dutch inititiative - the Holland Property Plaza platform - represents the ‘best of the rest’, including cities such as Breda, Enschede and Maastricht. Together, the dual platforms ensure a high-profile Dutch approach at EXPO REAL this year. International Dutch housing minister Stef Blok will be opening the Dutch stands and participating in various forums across the first two days of EXPO REAL as he sets out his plans to attract international investors in the country’s property market. Blok has three main missions. Firstly, he is continuing efforts to reform the Dutch hous ing market and ensure the country’s housing corporations dispose of surplus stock. He has also launched an ambitious programme to transform the Netherlands redundant office complexes into housing for a diverse group of
An artist’s impression of this year’s Amsterdam, Rotterdam, The Hague and Utrecht joint stand
residents, particularly students and starters on the housing ladder. The third challenge focuses on the disposal of surplus government build ings. Between 2011 and 2020, the Dutch state plans to dispose of more than half its total office stock as well as other property - includ ing the former royal palace of Soestdijk and several redundant ministerial buildings. On Monday afternoon Blok will take part in a discussion on mixed use re-development in Germany and the Netherlands. On Tuesday the
Netherlands takes centre stage in a discussion on the importance of regional networks in the Cities and Urban Development programme. (See page 16) Hall A2 stands 320 and 324 Urban re-development and transformation Monday October 5 13.00 - 14.00 Discussion and Networking Forum Hall A1 stand 440
Bouwinvest Real Estate Investment Management Bouwinvest Real Estate Investment Management BV (REIM) is one of the largest Dutch institutional real estate investment managers. Our Amsterdambased team of over 130 professionals manages total assets of € 7.2 billion in five Dutch property sector funds and international real estate investments. The Dutch real estate portfolio comprises five sector funds: a Residential Fund, a Retail Fund and an Office Fund which are all open to institutional investors and a Hotel Fund and a Healthcare Fund which are managed for bpfBOUW. The biggest part of our Dutch portfolio is invested in residential property, we manage the largest single unleveraged residential fund in the Netherlands. Bouwinvest is also the largest investor in property development generally in Amsterdam. We have invested approximately €2 billion across real 12 | EXPO REAL 2015
estate sectors in this city. In addition, Bouwinvest provides its anchor investor bpfBOUW with strategic asset allocation advice and investments in listed and unlisted real estate funds in Europe, North America and the Asia-Pacific region. Our funds and mandate are managed by experienced teams with expertise in asset management, acquisition, disposition and development. All team members have long track records in real
estate and extensive networks in the market with deep local knowledge. In international markets we select the top third-party fund managers and the leading listed real estate companies to invest in and monitor their performance closely. This combination of a strong domestic focus and a well-diversified global portfolio gives Bouwinvest a broad perspective on the real estate investment markets and allows us to identify the best investment opportunities that others may miss.
For more information on our investment opportunities www.bouwinvest.com. | Hal A2 Stand 324
Dutch develop cutting-edge office building As the developer of the world’s most sustainable building in the Zuidas business district, Rotterdam firm OVG knows a thing or two about cutting-edge construction. The Rotterdam-based office developer sees showcases such as EXPO REAL as an opportunity to export its high-tech concept to core markets such as London and Paris. ‘If it works in Amsterdam or Berlin, it will also work in London, Paris or New York,’ explains CEO Coen van Oostrum. The Edge, located in Amsterdam’s Zuidas district, is a 40,000 m2 Grade A office building that achieved an unprecedented score of 98.36 from the Building Research Establishment (BRE), becoming the first holder of the BREEAM ‘Outstanding’ certificate. Sensors The building contains a total of 6,800 sensors recording everything that happens in the building, allowing it to distribute its resources with maximum efficiency. Employees have an app on their smartphones that allow them to regulate the climate and lighting around their individual workspaces, using Philips’ Ethernetpowered LED connected lighting. A 4,100 m2 solar panel area on the roof and an aquifer thermal energy storage system located 130 metres below ground mean the
building is energy neutral. Reused rainwater and high-insulation valued walls also help to minimise waste. The building is the culmination of 18 years’ experience by OVG to become the Netherlands’ largest and most sustainable office developer, with more than €250 mln in office assets under management.
‘Technology is going to become a big thing in our buildings,’ Van Oostrum says. ‘If you can pinpoint what distinguishes one building from another by using all your data, you’re a winner.’ Hall B2 stand 413
Tight housing market is a major challenge International investment in the Dutch residential market is being held back by a lack of supply, according to market watchers. Marcus Cieleback, head of research at Patrizia Immobilien, says opportunities to invest in the rental sector have improved since the 2008 crisis. ‘Five to six years ago there was no thought of a residential institutional investment market in most European countries due to high ownership levels,’ says Cieleback, who is participating in a panel discussion on the cross-border housing market at EXPO REAL. The Dutch government has attempted to liberalise the rental market to attract private-sector investors at the top end, but the large Dutch social housing corporations, who own 2.4 million homes in a nation of 16.8 million people, have been reluctant to release large amounts of stock. When Patrizia acquired the €578 mln Vestia portfolio last year it was expected to trigger a scramble for Dutch stock, but the expected
tional-grade product. UK-based Round Hill Capital, the other big new entrant to the Dutch market, spent a total of €680 mln on residential assets in 2014 and has made two acquisitions in 2015 totalling €100 mln. ‘The government is actively encouraging international investment in trying to find ways that we can invest sensibly and socially appropriately in social housing,’ said Round Hill’s Kirk Lindstrom. rush has not materialised. Instead Patrizia has changed tack and is concentrating on developing in new-build stock, in collaboration with municipal authorities in cities such as The Hague, to get around the shortage of institu-
The Netherlands as an investment location Wednesday October 7 12:00 - 12:50 Investment Locations Forum Hall A1 stand 040 EXPO REAL 2015 | 13
Countries Austria
An East West hub at the heart of Europe A number of innovative projects in Austria are being showcased at EXPO REAL this year. Austria will be promoting itself as a major East West hub at this year’s EXPO REAL with over 24 exhibitors across two pavilions - Austria and Vienna Heart of Europe - says Stefan Reschke, executive partner at MAYA International, which is organising the Austrian presence at the fair. Real estate investment company 6b47 will be
exhibiting following its announcement of five new shareholders who will bring in €10 mln of assets, including Viennese projects Nordbahnstrasse and the former Philipps Haus, as well as the construction of 160 apartments in the 23rd Viennese district. ‘Among other exhibitors on the Austria and
Heart of Europe stands at EXPO REAL will be Bundesimmobiliengesellschaft (BIG), which manages Austria’s publicly owned real estate and Wien Holdings, owner of The Port of Vienna,’ Reschke said. The Port of Vienna, an important international logistics hub located on the banks of the River Danube, recorded increased revenue and its best result for five years, according to Vienna’s deputy mayor Renate Brauner. In 2014 around €8.7 mln was invested in the port’s infrastructure, which included the creation of new office space. In 2015 the Port of Vienna is investing around €10 mln which will include new operational areas and more land reclamation, as well as number of interesting real estate projects. Austria: Hall B2 stand 110 Vienna: Hall A1 stand 110
Austria’s stand at EXPO REAL in 2014
Stellar results for Austrian office market
Austria’s booming office sector is one of the subjects which real estate experts will discuss during the opening session of the Investment Location Forum. Austria’s office market, recent developments in retail and the growing interest from international investors will all be up for discussion during Monday’s panel session, which features Gregor Drexler, head of asset management at CA Immo in Vienna and Andreas Schultz, managing director of Warburg-HIH Invest among others. Space 2 Move According to research by Cushman and Wakefield, the second quarter of 2015 was a stellar one for investment in the Austrian office market with €311 mlm traded. The total was boosted by the largest deal involving Germany’s Union Investment acquisition of the 51,600 m2 Space 2 Move in Vienna from Raiffeisen Property International for €185 mln. Interest is expected to continue and activity by new international investors should increase linked to the rising number of multinational portfolio deals coming to the market that include Austrian-based assets. Key buyers are Union Investment, Deka, Allianz, 14 | EXPO REAL 2015
Space 2 Move changed hands this year for €185 mln
Morgan Stanley and Austrian open public funds like Bank Austria Real Invest and Erste Immobilien KAG. Occupier demand for core retail locations in Vienna remains strong and prime rents are under pressure to rise, Cushman and Wakefield say. A broad range of international fashion and luxury retailers are also targeting prime high street shops and well-located
shopping centres, with pop-up stores becoming much more prevalent in the market, especially in prime locations. Austria as in investment location Monday October 5 10:00 - 10:50 Investment Locations Forum Hall A1 stand 040
Cities and Urban Development EXPO REAL seminar series Full programme on page 18
Urban development: from smart cities to brand awareness Leaders from more than 30 of Europe’s top cities are taking part in a series of seminars at EXPO REAL during which key urban centres will be in the spotlight. Mayors, senior planners and other experts will lead the discussion and debate on urban development at nine sessions spread across all three days of EXPO REAL. The seminars cover all the key topics, with a sharp focus on the investment opportunities that result from different ways of developing cities. The opening session tackles the issue of how mid-sized cities can attract investment against the growing trend for investors to favour the largest conurbations. What are the competitive assets and opportunities they can present? Do they indeed have advantages over larger cities and what are they? Other sessions look at the future of city centres and ask whether the cities can adapt fast enough to the challenges of the modern
age. What city centre strategies will work to replace activities lost to digitisation, and what different strategies can be applied to ensure cities continue to innovate? The keynote speaker at the main seminar on housing on Wednesday is Sir Edward Lister, deputy mayor of London, who is responsible for planning, policy and major projects. He and the panel will discuss how the housing challenge can be met in Europe’s most successful cities. Among the other keynote speakers during the three-day programme of events are Howard Bernstein, chief executive of the city of Manchester, Hamburg’s mayor Olaf Sholz and Olle Zetterburg, chief executive of the Stockholm Business Region, as well as senior officials from Paris, Moscow and Tokyo. EXPO REAL 2015 | 15
Special
Cities & Urban Development
Combining for growth: The Northern Powerhouse and the Dutch G4 On Tuesday, EXPO REAL will host a unique keynote gathering of regional networks which work together for global growth. The UK’s Northern Powerhouse meets the Dutch G4. Can their combined forces trump London or Paris as a competitive location for top talent and global capital? In 2014 the British government outlined plans to encourage major cities in northern England to work together and stimulate development outside the south. The plan focuses on the core cities of Liverpool, Manchester, Leeds, Sheffield and Newcastle and is based on the concept of urban agglomeration. The aim is to rebalance the UK economy away from London and the South East by encouraging the cities to work together, pool their assets and connect their economic geographies to forge a new competitive global city region. Globally competitive ‘As a whole, the Northern Powerhouse has everything required to compete as a leading global
The Northern Powerhouse: key strategies Transport connectivity. Currently, east-west connections between these cities are poor and the ambition is to integrate rail services and upgrade the congested road system. This would amount to ‘travelling within one big city’. Universities and science clusters in the region should compete in the global knowledge economy. The region has undeniable strengths in this area. Creative and cultural clusters, the third pillar, seeks to develop the lifestyle, cultural and innovation opportunities which attract young creative professionals. The cities of the region are individually strong and this will aim to combine them. Devolution of power to the region. Government officials acknowledge the cities of the region cannot reach their full potential without greater powers. Greater Manchester has already been awarded a comprehensive devolution package, and is being showcased as a model for other cities to follow.
16 | EXPO REAL 2015
city region,’ says ULI professor Greg Clark, an expert on urbanisation and city planning. ‘Its size, talent pool, universities and logistics infrastructure means the sum of its parts offers everything to make it a global city region,’ says Clark. ‘In population terms, the region is larger than Greater London and the Dutch urban conurbation known as the Randstad. The Northern Powerhouse is also among the top three largest labour markets in Europe, underlining the sheer size of its talent pool and the wide range of skills employers can access. In economic terms, the Northern Powerhouse is second only to London in the UK. By presenting itself as region with a €261 bn GDP, it will attract greater investor attention than the individual sum of its parts.’ Individually, Clark points out, the northern cities have very different levels of integration into the global economy but their
Liverpool’s docklands have been transformed
combined firms and activities rival London for global economic connectivity, and place them among the leading global hubs among Europe’s secondary urban regions. Going Dutch A similar drive to create a regional powerhouse is under way in the Netherlands, where the focus is on the big four cities of Amsterdam, Rotterdam, The Hague and Utrecht. The Netherlands’ four largest cities are all unique, well-known and successful on an individual basis, Clark argues. When these assets are looked at together, what emerges is a region with a unique combination of specialisms in business, culture, creativity, manufacturing, logistics, higher education and diplomacy. According to Clark, the Dutch G4 cities provide opportunity on a scale with major global
The Dutch G4 advantanges Market size The 3rd largest consumer market in Europe, after London and Paris Globalised economy The 10th most globally connected and integrated services economy in the world Science and tech The 4th largest pool of science and technology workers in Europe Higher education The 10th region globally for top-ranked higher education institutions R&D The 4th highest amount of R&D investment in Europe Innovation A top 5 region globally for innovation potential Conventions The 2nd most popular conference and conventions region globally Destination power The 5th most visited region in Europe Infrastructure The highest capacity and most integrated infrastructure region in Europe Quality of life The only large (five million person plus) region in the top 10 highest quality of life cities globally Sustainability The most sustainable large region in the world
city regions such as London, Paris and Istanbul, combined with the living standards and distinctive identities of Stockholm, Zurich, Copenhagen or Vienna. They also have the advantage of being close together and better connected than estabnlished metropolitan regions that at-
tract media interest such as London, New York and Hong Kong. In addition, Clark says, the G4 Region is a global knowledge powerhouse with the potential to become Europe’s most important innovation hub. The G4 consists of four major cities and surrounding municipalities. The effect of the
world class infrastructure and connectivity is that these four are all effectively part of the same city region. The combined populations and economies place it among the three largest urban systems in Europe with over seven million people, the sixth largest urban economy, and the sixth largest urban labour market. Secret weapons In essence, says Clark, the four cities of the G4 region are each other’s secret weapons. ‘They are highly complementary from economic, infrastructure, knowledge and quality of life perspectives,’ he says. ‘Their polycentric character means that benefits can be shared without detracting from each other’s specialisms and quality of life. Positioned properly, the region is justifiably propelled into the leading pack of global regions.’ The Northern Powerhouse & the Dutch G4 Tuesday October 6, 11:00 - 12:20 Hall A2 stand 040
Helsinki develops smart city concept The needs of the innovation economy will be in the spotlight in a special Urban Development session. Helsinki’s deputy mayor Anni Sinnemaki, who is taking part in the panel, explains how her city is taking up the challenge.
What is Helsinki’s strategy for b uilding an innovation economy?
which has been to enable the development of the public transport information. Companies can use the data to build apps for public transport. Helsinki has a large student population, which gives us energy and ideas, and our population is growing rapidly. We now have
We are aiming for open cooperation between the public sector, business and our universities. For us an innovation economy means developing a new ‘smart city’ within Helsinki, where all the buildings and apartments are connected to a smart grid and people can track their energy use. One pilot project is the Nordics’ largest electrical storage facility which is being developed by energy company Helen Oy. The pilot project will test new opportunities offered by a megawatt-scale electricity storage facility, as a result of which Helsinki will offer the largest electricity storage in the Nordic countries.
Finland is rebalancing its economy towards high-tech businesses. How does this impact on the real estate landscape of Helsinki? We are building more quality retail and office space close to public transport. Old office buildings will be demolished to make space for new residential homes. We currently have two substantial retail projects.
What sort of investment do you hope to attract to Helsinki? Our aim is to showcase the growth and ambition of Helsinki, opening up new development areas, and we are also preparing a residential design and build competition at Pasila, another area of Helsinki. We will be talking about this at EXPO REAL.
How have you been able to do this? Aspiring to be a ‘smart city’ is a question of attitude. We are enablers seeking to work together with those of a similar mind. Helsinki pioneered public open data, one outcome of
a population of around 620,000. Kalasatama, a waterfront location adjacent to Helsinki’s city centre will eventually be home to around 20,000 people. It will have a specially designed platform for pilot innovations.
Helsinki’s deputy mayor Anni Sinnemaki says being a smart city is a question of attitude
Hall B1 stand 320 EXPO REAL 2015 | 17
Special
Cities & Urban Development
Intelligent urbanisation: a platform for investment? Digital technologies, big data and social media are making it possible to integrate and better manage city systems, making them more sustainable and productive. Two Monday sessions in the Urban Development programme focus on the key trend of smart cities and their evolution. The first session looks at the concept of smart cities with experts from Bristol, Glasgow, Vienna and Stockholm, and asks whether this intelligent urbanisation can itself create new investment opportunities. Do cities with more integrated systems and technology platforms
enable a better quality of life for their residents by being more ‘shared’? The second session looks at the key issue of Europe’s role in developing knowledge intensive and creative industries. Their needs in terms of land use, buildings and infrastructure are different to those from traditional industries and tourism, and many cities have set up special innovation districts to encourage them to succeed. Senior officials from London, Lisbon, Helsinki, Edinburgh and Leeds will discuss the real estate needs of this specific type of business and debate whether innovation districts work.
Deputy mayor of London Sir Edward Lister Keynote speaker
Is city branding effective in attracting investors?
Olle Zetterburg, CEO, Stockholm Business Region Keynote speaker
We know cities need a brand to capture tourists, act as the location for a film shoot or win the right to stage the Olympics. But do cities really need a brand to attract investor cash? On Wednesday, a special EXPO REAL panel examines all sides of the argument. Are investors not focused simply on the scale of the assets, the ROI, and the costs and risks of the transactions involved? It seems that maybe they are not. City identity and reputation play an important part in investor sentiment and cities know they can influence these with sophisticated communications. Cities with great
reputations are often assumed to be bigger than they actually are, and cities that experience reputational damage are widely perceived to be failing much more than they actually are. So how do cities plan their communications with investors and what role does city branding play? EXPO REAL will play host to some of the most successful and award-winning city brands such as those managed by Berlin, Amsterdam, Stockholm and Glasgow. It may just be that reputational strength lasts longer, and adds more value, than infrastructure or a pristine business climate.
Cities & urban development programme Monday October 5
Tuesday October 6
Wednesday October 7
Attracting new urban investors to mid-sized cities. With speakers from Birmingham, Gothenburg, Krakow and Liverpool. Hall A2 stand 040 (10.00 to 10.55)
Airports and urban development. With speakers from Munich Airport, Manchester Airport Group, Amsterdam Schiphol, Helsinki Airport, Paris Airport Group. Hall A2 stand 040 (10.00 to 10.55)
Housing: how can cities boost supply and increase affordability? With speakers from London, Tokyo, H amburg, Istanbul. Hall A1 stand 440 (10.00 to 10.55)
Intelligent Urbanisation: smart and future cities, a platform for investment? With speakers from Bristol, Glasgow, Vienna, Stockholm. Hall A1 stand 432 (11.00 to 11.55)
The Northern Powerhouse and the Dutch G4. With speakers from Manchester, Liverpool, Leeds, Sheffield, Newcastle, Amsterdam, Rotterdam, The Hague, Utrecht. Hall A2 stand 040 (11.00 to 12.30)
City centre futures and retail: can cities adapt fast enough to the modern age? With speakers from Birmingham, Cardiff, Vienna, GVA Bilfinger. Hall A1 stand 440 (11.00 to 11.55)
Innovation districts: building the innovation economy. With speakers from London TechCity, Lisbon, Helsinki Edinburgh, Leeds. Hall A1 stand 432 (12.00 to 13.15)
New transport and densification in growing cities. With speakers from Tokyo, Paris, Istanbul, Moscow. Hall A2 stand 040 (12.30 to 1.30)
Can branding transform cities and attract investors? With speakers from Amsterdam, Glasgow, Stockholm and Berlin. Hall A1 stand 440 (12.00 to 13.15)
18 | EXPO REAL 2015
Countries Switzerland
The Circle first phase will complete in 2018
The Circle, Zurich’s new hot spot, is taking shape After six years, The Circle aims to square demands for Swiss real estate Situated next to Zurich Airport, The Circle will be the biggest construction site in Switzerland. The dismantling of the existing buildings and car parks began in January and the first phase is expected to complete in 2018. The Circle is divided into seven modules. ‘Health & Beauty’ and ‘Hotels & Convention’, comprising about 60,000 m2, have been fully rented out to Zurich University Hospital and the Hyatt hotel chain. The globally renowned hotel group will operate two hotels, a Hyatt Regency with 250 rooms and a Hyatt Place with 300 rooms. A convention
centre, also Hyatt operated, will be linked to the hotels, with capacity for up to 2,300 people. According to Beat Pahud, senior vice president at The Circle, who will speak on the Switzerland Investment Locations Forum at EXPO REAL, The Circle’s mix of uses, the quality of stay with high quality architecture and park, is a selling point for the development. But other issues are also at play and how to manage the current strength of the Swiss Franc and its influence on the real-estate industry will be a key discussion topic at EXPO
REAL, along with the amount of vacant office space in Switzerland’s major cities. ‘The Circle offers 75,000 m² of office space, of which 30,000 m² will only be realized within the second phase,’ says Pahud. Thus, the challenge for The Circle is manageable, as there are three years to rent out the remaining space. The Circle is, thanks to its unique accessibility at the airport, the best connected site in Switzerland.’ Hall C2 stand 320
Safe but sure, Switzerland still attracting investors Economic growth is expected to edge upwards in Switzerland over the next six months, according to the Centre for European Economic Research. Switzerland might not be the most attractive investment market compared with other European countries, but its stability and risk/ returns ratio remain strong, according to Martin Signer, head of real estate management Switzerland at Swiss Life, based in Zurich. Signer will be speaking on Switzerland as an investment location at this year’s EXPO REAL. ‘The main investors are by far still Swiss, the banks, insurers and pension funds. When foreigners invest in Switzerland, they primarily do so indirectly through stock-listed real estate companies and real estate funds. However, both categories do currently have a substantial premium/agio, which is not a preference of foreign investors,’ he says. The Swiss residential sector, traditionally very stable, will continue in the near and midterm
increase in one-person households.’ He is less optimistic with the office market in periphery locations. ‘The situation there remains challenging, mainly due to an oversupply of office space coupled with stagnating demand. This leads to pricing pressure, even for central locations. Looking at the economy as a whole, Swiss Life Asset Managers expects corporate investment spending in Switzerland to slow down slightly until 2016 and the unemployment rate to gradually rise.’ Martin Signer
future, according to Signer. ‘The reasons include high immigration rates but also an increasing demand for living space by the Swiss population as a consequence of the
Switzerland as an investment location Monday October 5 11.00 - 11.40 Investment Locations Forum Hall A1 stand 040 EXPO REAL 2015 | 19
Countries Germany
Long leases benefit regional cities Second tier German cities are outpacing the big seven and investors are looking towards the regions. International investors are more likely to consider going into regional cities in Germany than similar second tier cities in the UK, according to leading real estate investors. The strength of German real estate lies in its stability and the wide range of large to mid-size city markets with long leases on offer. Thanks to strong demand, more regional cities are outpacing the big 7 German markets in terms of rental growth. ‘In Germany, investors will easily go to Mönchengladbach. When we show them long leases there they love it,’ said Didier Unglik, chairman of investment manager Etoile Properties, speaking earlier this year at a Dutch property fair. Lack of space The push to regional German cities could be the result of a lack of suitable space in the larger urban areas. According to a report by Cushman and Wakefield, the availability of space in the country’s top 5 cities is at its lowest level for 12 years and declined marginally in Q2, driven primarily by high letting activity and low speculative completion in cities such as Munich and Berlin, while in Frankfurt the decline in vacancy was driven by refurbishments and conversions. There is a limited supply of prime retail stock, according to Cushman and Wakefield, but a better
German cities and regions are again out in force
supply in second-tier and secondary markets. Investing in Germany will be under the microscope at an EXPO REAL investment locations forum on Monday October 5, when experts will look at the main issues facing the market. Low interest rates The German commercial investment market saw a total volume of €8.2 bn in the first quarter of 2015, a decrease of 19% year on year, Thomas Beyerle, managing director of Catella Property Valuation GmbH told a PropertyEU investment briefing earlier this year. Investors are focusing
on second and third tier locations due to stable occupier demand and higher yields, with offices being the preferred asset class. It is likely to be another strong year for investment, with ongoing demand for prime office and residential space, but Beyerle warned: ‘There is an absolute lack of new development in Germany.’ International Investors and Germany Monday October 5 12:00 - 12:50 Investment Locations Forum Hall A1 stand 040
Prelios Immobilien Management
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institutional and private core-investors, developers and opportunistic investors benefit from integrated services from one provider, tailor-made property concepts and locationspecific solutions – in close cooperation with municipalities, tenants, investors and business partners. We take responsibility for all fields that determine the value increase and the development of your properties and portfolios. Let´s talk about your business! Prelios Immobilien Management is a leading German specialist for demanding real estate in challenging conditions, thanks to the highly professional team, the substantial international, national and local market expertise and the extensive scope of works. In the last 5 years Prelios Immobilien Management conducted
transactions with a volume of more than EUR 3.1 billion. Today, Prelios runs about 1 million square meters spaces in shopping centers, department stores and mixed-use buildings in Germany. We got a holistic view on your asset to boost your business, no matter if the topic is bankability, e-commerce or re-positioning. MEET PRELIOS AT EXPO REAL Stand C1.220
Look at www.prelios.de or call us +49 (0) 40 / 350 170-0.
German investors urged to go east
After years of economic stagnation and political turmoil, Japan is once again becoming an attractive market for investors and international players are being encouraged to get involved. A delegation at EXPO REAL will hold the second in a series of round table meetings focusing on the opportunities that Japan offers to German developers, asset managers, investment funds and researchers, following a successful launch in Tokyo in May. The programme is supported by Shinzo Abe’s government, which is keen to show that the country is open for business. Heading the delegation is Leonard Meyer zu Brickwedde, president of the Tokyo-based Kenzo Capital Corporation. Meyer founded the corporation in 2008, having previously set up a specialist team in Tokyo for a German real estate finance bank in 2000, just as the Japanese institutional market was getting going. Core markets The fact that Japan is still relatively new to the institutional arena is one of its defining charac-
Leonard Meyer zu Brickwedde
teristics, he explains. ‘The most important thing to understand is that Japan is a core market, it’s not an opportunistic playing field. It’s a market for long-term investors who want to cash in on a good, stable cash flow. But there is still big demand among Japanese institutional investors and private investors in real estate.’ German investment in Japan swelled rapidly
Berlin is abuzz and office take-up is proof
Berlin made a splash in 2014
Berlin is a hive of creativity and start-ups and that is reflected in developments in the city’s office market. The take-up of office space in Berlin in the first half of 2015 registered an increase of 23% year on year, according to property advisers CBRE. This is the best result recorded since 2000. The TMT sector (technology, media and telecommunications) remained strong with a 40% share of the letting market. This was driven by several lettings to fast-growing online fashion retailer
Zalando which accounted for 20% of total office take-up. 155,000 m2 of new office space was completed in the first half of the year, of which just 7.5% was speculative. Among the Berlin-related events at EXPO REAL is Tuesday night’s reception. The city’s minister for urban development and the environment Andreas Geisel is among the guests of honour. Hall B2 stand 420 and 323
in the build-up to the Lehman Brothers crash. After two years when transactions slowed to a trickle, volumes have returned to 2006 levels, but the circumstances are very different, says Meyer. ‘Today we have a government that is decisive and that has decided to fight deflation, and which has a majority in both houses, so there is stability for the next three or four years,’ he says. In addition, funding is more solid, with leverage of around 50-65%, rather than the 90% seen in pre crisis years. That, he says, means Japan is ripe with opportunities.
Taurus sees safe investments but low margins in Germany Germany is a good foundation for every portfolio, says Nicolai Striewe, director of US investment firm Taurus Investments’ German operations. Boston-based Taurus is currently boosting its profile outside the US and expanding into Europe. The company’s European operations are headquartered in Munich and Taurus owns and operates over 100 properties throughout Germany. Germany offers a solid base but with low margins and investors are currently likely to achieve only inflation increases in their portfolio, says Striewe. The company is looking for annual investment returns of at least 8%, and while there are stable investments to be made in grocery-anchored retail real estate, shopping centres are changing with the advent of multi-channel shopping and will become more like showrooms, leading to smaller retail space requirements and retail demand for prime locations, Striewe says. With delivery companies aiming to service on-line shopping, logistics parks will move closer to city centres, he predicts. ‘We are looking at investments with very long leases and close proximity to metropolitan areas. We found this recently at Oberpfaffenhofen, a suburb of Munich.’ Hall B1 stand 230 EXPO REAL 2015 | 21
Sectors Retail
Retail focus on challenges, opportunities Even though European retail sales hit an all-time high last year, vacancy rates, e-commerce and internationalisation all pose particular challenges for the sector.
Four sessions at EXPO REAL on Wednesday will focus on the European retail sector, covering the latest trends on the high street and the growing importance of online shopping. European retail sales and shopping centreinclined sales reached all-time highs in 2014, totalling more than €2.7 tn and €524.7 bn Retail Dialogue Wednesday October 7 10:00 - 13:50 Planning and Partnerships Forum Hall A2 stand 040
respectively, according to a report released by ICSC this summer. The industry also contributes 4.2 million shopping centre-related jobs to Europe, with the retail industry as a whole accounting for one out of every 11 jobs and above average female participation and youth employment rates. The ICSC report, entitled The Socio-Economic Contribution of European Shopping Centres, also reveals that 90% of sales still occur in physical locations. Despite the rise of sophisticated omni-channel retail strategies, bricksand-mortar stores remain an integral part of
ICSC key findings • As of 2014, there were 9,263 shopping centres in Europe • European total retail sales totalled more than €2.7 tn • Approximately €48.7 bn was invested in retail assets across 26 European countries • There are roughly 4.2 million shopping centre-related jobs in Europe • Over 90% of total European retail sales still occur in-store
the consumer experience. ‘The retail and shopping centre industry has provided critical economic support during some very tough times in recent years, and is playing an equally critical role in Europe’s recovery and future prosperity,’ says ICSC’s executive vice-president Mike Morrissey.
Retail Challenges – Be prepared! Retail property may possibly be in the verge of a paradigm shift although most of its players are being slow at appreciating it. At this moment, the property sector is lagging behind Alexandre Fernandes to meet global megatrends. Changing demographics and, in particular, the inexorable advance of digital technology is already transforming modern retail. But the scale and pace of change will no doubt increase with new devices and software reshaping customer behaviour and its interaction with brands, products, services and shopping centres, with a clear evolution towards a digital shopping 22 | EXPO REAL 2015
experience. But the digital will not stand alone, since it needs to be integrated with the emotional approach and social involvement that only the physical interaction creates. Successful retailers and shopping centres will be the ones that can truly merge the physical space with the digital marketplace and provide experiences, not just ‘shopping’. In parallel, new concepts targeting to specific consumer patterns, like “experience – style” shopping locations in city centres or luxury outlet schemes proof to be outperforming niches, very well accepted by final clients. One of the upmost challenges of the shopping centre industry is, and will be, the ability to consistently integrate these niches into the existing schemes, through refurbishment and expansion initiatives, and offer the customer a portfolio of different experiences he can live through. All this
surrounded by a digital atmosphere to make the challenge even more ambitious! The shopping sector must be prepared for fundamental (or tsunamic) challenges derived from undeniable megatrends like the digital world, consumer behaviour upheaval, demographic change and globalisation. Taking the long view, these trends will imply demanding answers from all the shopping centre industry, not complacent with only cosmetic adjustments, and a move into trickier and exciting scenarios. Be prepared!
www.sonaesierra.com stand B2.112
E-commerce: grocery services are next
Despite the rise in online shopping, there has been no let up in the development of shopping centres. A special Retail Dialogue session will explore the latest issues in the online – offline debate. In the near future the Mailbox in Birmingham, the UK’s second largest mixed-used building, will launch what its owners claim is the most technologically advanced consumer app to date. The shopping centre, which has been undergoing major overhaul, will roll out the new app in the run-up to the all-important Christmas shopping season. ‘There’s a lot of technology development going on in shopping centres but it’s done in silos with teams not talking to each other about their strategies, and more seriously there were issues, monitoring and tracking people without their permission,’ says Sam Robinson, head of marketing at Mailbox joint owner Milligan. This, he said, is ‘a basic mistake’. ‘Our approach pulls all available technology together to offer a seamless service while respecting the privacy of our customers, giving them full control over what they share while using the app,’ Robinson explains. As groups like Milligan adopt the opportunies offered by new technology to bring people into their stores and monitor what they get up to, online retail continues to grow. And, according to figures by retail monitoring group Syndy, the online grocery channel is now making the breakthrough. It expects the online grocery channel to grow to €80 bn+ by 2018. This represents an opportunity for the retail logistics sector, but a challenge for traditional supermarket-anchored shopping centres. The report focuses on the
Online retail may be growing but nothing beats discussing the issues face to face
United Kingdom, Netherlands, France and Germany, as well as the United States, and covers key market trends and developments. The expanding pick-up point network in Europe was one of the highlights of the year. For example, the Netherlands saw an extraordinary 680% increase in the number of pick-up points compared to the beginning of 2013. Membership schemes like Amazon Prime give consumers access to unlimited home delivery in return for a fixed monthly fee.
Mall of Split artist’s impression
Online versus offline Wednesday October 7 10:00 - 10:50 Planning and Partnerships Forum Hall A2 stand 040
German retail chains go for global growth As Aldi and Lidl continue their global growth, EXPO REAL will host a retail dialogue on the international expansion of German retail
Aldi and Lidl stores are all over the globe
Expansion for SES across Europe
chains. Aldi is continuing to expand across Europe. In the UK it expects to be twice the size of Asda and in the US it plans to spend more than $3 bn opening its first stores in Southern California next year, according to the Wall Street Journal. Lidl now has over 9,000 stores in more than 26 European countries. It has also earmarked the US for growth, opening a US headquarters in Virginia, but has not year announced how many stores it plans to open. Retail chains from Germany Wednesday October 7 12:00 - 12:50 Planning and Partnerships Forum Hall A2 stand 040
Expansion is the name of the game for Austriabased shopping centre developer and operator SES Spar European Shopping Centers. The company’s declared objective is a clear focus on inner town and city locations and the refurbishment of existing shopping malls and it will be showcasing a number of developments at this year’s EXPO REAL. In a joint venture with the city of Vienna, SES is participating in one of Europe’s largest urban development projects at Aspern Seestadt. The whole project covers an area of 2.4 million m2, including 20,000 m2 for retail and leisure, including a managed shopping mile close to Vienna’s newest lakeside suburb. Other projects being showcased by SES Spar European Shopping Centers at EXPO REAL are two new shopping centres at Bregenz and Ried, Austria, and one at Bolzano, Italy, as well as redevelopment schemes at Fischapark, Wiener Neustadt and Huma, Vienna, and centre management at the Mall of Split, Croatia. Hall A2, Stand 112 EXPO REAL 2015 | 23
Regions Russia
Russian cities out in force at EXPO REAL Moscow is leading the pack of Russian cities which are presenting their investment opportunities this year, despite the political and economic sensitivities. In total, five Russian official bodies and two companies are taking part in EXPO REAL this year, emphasing the country’s continuing determination to attract foreign investment and development. The Russian real estate market has taken a number of knocks in recent years, yet it was only in 2012-2013 that Moscow was the third European investment market after London and Paris, points out Denis Sokolov, head of research at Cushman & Wakefield Russia. ‘Devaluation and recession wiped out some of those achievements, but it is just a matter of time before the market will be back at those figures,’ he says.
Legal frameworks This year in Munich, the national ministry of construction is joined by Moscow city and the wider Moscow region, the Nizhny Novgorod region and the region centred on the historic city of Tula, around 200 km south of the Russian capital. Ikea Russia and Ulmart represent the commercial sector. Moscow’s department for external economic and international relations says its activities are focusing on preparing projects likely to be of
The Moscow stand at EXPO REAL in 2014
the most interest to foreign investors. ‘In order to make this possible, we are developing legal frameworks for investing while ensuring ongoing protection for investor interests and lending them informational and legal support,’ the department says. One Moscow pilot project on show involves the creation of a campus for students enrolled at the Moscow State University of Mechanical Engineering. International investors will also be introduced to
the concept for developing the Moscow river’s embankment area and the vast potential offered by the waterway itself. For more on Russia’s EXPO REAL profile, see the special supplement. Russia as an investment location Monday October 5 14:00 - 14:50 Investment Locations Forum Hall A1 stand 040
TriGranit – Two decades of excellence in Central Europe Since completing one of Hungary’s first Class ‘A’ office buildings and the nation’s first Westernstyle shopping centre in the 1990’s, TriGranit has always taken a pioneering approach to its real estate Árpád Török, developments. Today, CEO, TriGranit the company is one of the largest fully integrated, privately owned regional real estate investment, development and management companies in Central Europe. The company’s main focus is on mixed-use ‘City Center’ projects, class ‘A’ office and prime retail developments in strategic urban locations. TriGranit is able to provide a full spectrum of development, construction, property and asset 24 | EXPO REAL 2015
management and operations services. During its 2 decades of operation, TriGranit has carried out more than 50 projects in 9 countries and developed total area of over 1 million m2 GLA and in a combined value of 2.5 billion EUR. Poland is TriGranit’s primary focus today, but the company has projects in the pipeline in Slovakia and monitors many other countries in the region where it could apply its knowledge and experience. In July 2015, a sale and purchase agreement was signed with TPG Real Estate, the real estate unit of global private investment firm, TPG. The acquisition pertains to the TriGranit platform, as well as the full Polish, Slovakian and part of the Hungarian and Croatian portfolio. TPG, with further capital injection, is to create the CEE region’s leading real estate investment, development and management platform.
‘TPG Real Estate’s expertise and global presence makes it the ideal partner to further strengthen and expand our business through the development and management of office and retail projects in key strategic locations, as well as through strategic acquisitions in the future’ – said Árpád Török, CEO of TriGranit. About TriGranit TriGranit is one of the largest fully integrated, privately owned regional real estate investment, development and management companies in Central Europe. The company’s primary focus is on mixed-use ‘City Center’ projects and office and retail developments.
www.trigranit.com | stand: B2.132
Regions CEE
Romanian real estate is open for business Romania is represented at EXPO REAL for the fourth year running with a joint stand featuring 11 companies and institutions. With GDP growing by 2.8% in 2014, Romania’s economy is supported by over €43bn of EU and national government incentives due by 2020. Real estate has benefited directly from the country’s continued growth, with last year marking a post-crisis record for commercial investment volumes and office take-up, rising to €1.3 bn and 315,000 m2 respectively. According to Razvan Iorgu, managing director of CBRE Romania, last year was one of
Slovenia is still under the radar
Eco Silver House in Ljubljana
Slovenia is back at EXPO REAL this year with a dedicated Invest Slovenia stand, as the Alpine country continues to encourage foreign investment. Slovenia’s property market may remain under the radar for many, but the country has so far this year seen the greatest number of real estate transactions since the 2008 crisis, rising by a third on last year, according to the country’s official broadcast service. According to a report by property advisers JLL, in the past 24 months Ljubljana’s office market has seen limited new development activity. In 2014 the market witnessed the completion of smaller scale schemes, namely Eco Silver House and several smaller office developments located around the city centre. Slovenia, Croatia and Serbia Tuesday October 6 12:00 - 12:50 Investment Locations Forum Hall A1 stand 040
the best for commercial real estate in Romania, on a par with the previous boom years between 2007 and 2009. All areas of commercial real estate saw remarkable growth and intense commercial activity. ‘The office market saw more international companies move in to Romania, both via new entrants and the expansion of current global occupiers and investors,’ he says. ‘On the manufacturing side, many businesses looked to invest in new locations, due to the intense competition in certain geographical areas, specifically western Romania.’ Public sector exhibitors on the Romania stand at EXPO REAL include the Department for Foreign Investment and Public-Private Partnership (the governmental body promoting and attracting foreign investment into Romania), the City of Bucharest and the County of Satu Mare. There is also significant representation from the industrial park sector including Eurobusiness Parc in Oradea, Parc Industrial in Brașov
AFI Palace Cotroceni is one of the biggest shopping malls in CEE
And Tetarom SA in Cluj, along with industrial park developers Artemis Real Estate Timișoara, Bardeau Imobiliare and WDP Development Romania. Hall A1 stand 234
Czech Republic leads CEE deal volume The plus points and negatives attached to investing in Poland and the Czech Republic will be debated at EXPO REAL. The Czech Republic led CEE region in the first six months of 2015 with €1.2 bn of finalised investment transactions, followed by Poland with a total volume of €813 mln, according to a report from JLL. The total real estate investment volumes over the period reached approximately €2.55 bn in the region, the advisor said. ‘As the prime European real estate markets returns become increasingly tight, other investment locations look more attractive,’ says Troy Javaher, regional director, head of CEE investment at JLL. While the main focus so far has been on Poland and the Czech Republic, other CEE capital cities along with Poland’s regional markets will also be highly Poland as an investment location Tuesday October 6 10:00 - 10:50 Investment Locations Forum Hall A1 stand 040
The Warsaw stand at EXPO REAL 2014
sought after, Javaher predicts. ‘The weight of international capital seeking core CEE opportunities has provided increased liquidity for large lot-size properties and portfolios,’ he says Czech Republic as an investment location Tuesday October 6 11:00 - 11:50 Investment Locations Forum Hall A1 stand 040 EXPO REAL 2015 | 25
Countries US
Investment looks both ways across the pond For the 10th year, Brad Olsen, president of international consultancy firm Atlantic Partners, organises EXPO REAL’s American Afternoon sessions. Having moved capital in both directions across the Atlantic for decades, Brad Olsen has lined up three experienced panels and moderators to discuss German investment opportunities in the US and Canada, and where North American investors are targeting their investment ambitions in Europe. Capital Just as German investors being circling the US market again, there seems to be more capital than opportunities. Leading players in US real estate markets Stephen Collins, JLL’s president, capital markets Americas, Stephen Livaditis, managing director of Chicago-based Eastdil Secured LLC and Christopher Ludeman, global president, capital markets at CBRE, will debate what German investors have been buying in the US with moderator Ulrich Steinmetz, managing director RREEF Investment and what sectors and strategies look attractive for German investment in 2016.
Brad Olsen
Potential investors will also be able to join a spotlight on Canada. Following the global financial crisis, Canadian real estate markets outperformed others, but declining oil and commodity prices have altered
the landscape. Domestic pension funds dominate the real estate markets, but REITs have been far less active as the cost of their capital has risen. Is there now more room for German investors in the Canadian market? Panelists debating this issue at EXPO REAL include Stephen Taylor, vice president real estate at HOOPP (Healthcare of Ontaria Pension Plan), Gordon Vollmer, executive vice president at Toronto-based Morguard Investments Limited and Ted Willcocks, global head of asset management at Real Estate Manulife, Toronto, led by moderator Markus Zoppa, head of the Americas, international acquisitions and sales at Deka Immobilien. An American Afternoon Monday October 5 15.00 - 17.50 Investment Locations Forum Hall A1 stand 040
US real estate giant Hines heads to Europe With a fourth project under way in Ireland, Greece is also on the radar, says CFO Lars Huber US real estate giant Hines is embarking on a new major master-planned development in Europe - its fourth after Diagonal Mar in Barcelona, the former Renault site near Paris and the central Porta Nuova district in Milan. Andreas Schreurs, senior managing director, investment management at Hines, will participate in an EXPO REAL panel session on Investment & Transactions: who is investing where, how and why? This time, the privately-held group is betting on the Irish capital which, after years in the doldrums, has recently become one of Europe’s fastest recovering property markets, showing both strong rental growth potential and very limited supply. Hines, which opened an office in the city in Strategies under the spotlight: Monday October 5 12:30 - 13:20 EXPO REAL Forum Hall A2 stand 540 26 | EXPO REAL 2015
2011, completed the purchase in late 2014 of a 390-acre site in Cherrywood, South Dublin. Hines is planning a new town ‘the size of Hyde Park’ on the site, according to Lars Huber, CFO and co-head of Hines’ Europe region, speaking to PropertyEU in July, ahead of EXPO REAL. ‘This project, which has a 35-minute light rail link to the city centre, will completely transform the suburban landscape south of Dublin,’ he said. Over the past two decades the company has developed nearly 1.5 million m2 across three major European projects in Barcelona, Paris and Milan. The company is expanding into the UK student-housing sector and is considering entering logistics development. Hines is also monitoring Greece for a potential entry, Huber noted. ‘This will allow us to access the market quickly when and if the difficult macroeconomic situation settles down. We believe there is a positive future ahead for Greece.’
The Diagonal Mar project in Barcelona
Sectors
Hospitality
China looks for overnight accommodation in Europe Europe has seen an influx of Chinese capital enter the hotels market and there is more to come. Reason enough to host a special session on Chinese investment in hotels and hospitality at EXPO REAL. Earlier this year year, Jin Jiang International Hotels Group confirmed its purchase of Louvre Hotels for $1.3 bn. Louvre Hotels has more than 1,100 hotels in 47 countries including the Kyriad, Campanile and Royal Tulip brands. Christoph Harle, CEO EMEA JLL Hotels & Hospitality, predicts more such deals before the year is out. Earlier in the year JLL predicted that in 2015, Chinese capital would represent some $5 bn in global hotel investment. The panel is being moderated by Wolfgang Arlt, director of the China Outbound Tourism Research Insitute in Hamburg, who first spotted the potential in Chinese tourism 15 years ago. In the first six months of this year 62 million Chinese nationals crossed the border, the institute
says. As well as Chinese investment moving into European hotels, some EU cities are also waking up to the potential offered by Chinese tourism. Amsterdam, for example, has plans to develop hotels specifically for this mass tourism segment. Earlier this year a group of some 4,500 Chinese workers were in the Netherlands for a mass company outing. Another Chinese billionaire even took 6,400 of his staff to Paris and the Cote d’Azur. The Chinese are coming Monday October 5 14:00 - 14:50 Special Real Estate Forum Hall C2 stand 240
The Jin Jiang hotel group has sky high ambitions
Hotels take centre stage in Hospitality Industry Dialogue This year’s Hospitality Industry Dialogue at EXPO REAL focuses on the hotel trade with sessions on finance, lifestyle hotels, financing expansion and new market players from the Far East. ‘It’s time to ask who the new investors are and if the newcomers also understand the specifics of special real estate like hotels,’ says Maria Puetz-Willems, editor of Hospitality Inside, who has organised the sessions. ‘Owner and operating companies are speeding up their expansion. So the four leaders of the Katara, Kempinski, Rotana and Scandic hotel groups – Christopher Knable, Alejandro Bernabé, Omer Kaddouri, Frank Fiskers – have been invited to talk about how they finance expansion and prepare for the next crisis.’ The hotel sector is becoming a hybrid industry, as the rolling lifestyle hotel wave brings in new solutions in terms of rooms and spaces. So one session will discuss the lifespan of a lifestyle hotel, individualisation and floor space calculation in classic and hybrid models. Change is also the key word for a final panel session talking about the changes in contracts. What factors must the parties take into account for the next 20 years? European hotel transactions surged by 85% in the first half of 2015 to €13.2 bn, primarily driven by the UK, which accounted for nearly 50% of all hotel deals in the region, according to research by JLL. The first half of 2015 saw a significant number of single-asset and
Katara, Kempinski, Rotana and Scandic hotels
portfolio transactions. The largest portfolio deal to date was the sale of 18 Accor hotels in Germany as part of a sale and franchiseback deal to Event Hotel Group for €150 mln, while the Marriott Hotel in Munich was just one of a handful of single-asset deals to complete during H1. Private equity and investment funds, particularly from North America, continue to actively target European hotel investment opportuni-
ties. Lone Star Funds has been the most active investor in the UK, having spent over €1.7 bn on more than 13,000 rooms in London. .regional locations already this year. How do you finance expansion? Monday October 5 15:00 - 16:20 Special Real Estate Forum Hall C2 stand 240 EXPO REAL 2015 | 27
Sectors Finance & Investment
How should cities prepare for black swans? Professor Hugh Kelly of the Schack Institute of Real Estate at New York University will outline his views in a keynote speech at EXPO REAL. Here he gives a sneak preview. How can cities anticipate events which are by their nature unpredictable? In our risky world these threats are coming with greater frequency and greater impact. No city has experienced that in the course of the last 15 years more than New York. During that time we’ve had a recession triggered by the meltdown of the dotcom industry, we had the 9/11 event, we were at the very heart of the global financial crisis, when all the big banks and Wall Street just locked up and froze. For all that, New York is a very resilient place. It has faster job growth than the country as a whole and has gained in population to the tune of 300,000 people. The nature of that resilience is part of the answer to how we prepare for non-specific event risks. What lessons can the rest of the world learn from New York’s experience? The first thing is a fairly simple one: Don’t put all your eggs in one basket. Economies that are monocultures are more prone to deep downturns and long recoveries than one that have diversified on an economic basis. The second thing is that cities that are focused on innovation are markets where we have the ability to get ahead of issues. The best markets are not the problem-free markets, but the problem-
which means higher profits for companies, and those profits make the high rents affordable.
Hugh Kelly
solving markets. For instance, New York City once had a terrible air problem, but in the last 10 to 15 years the city has attacked things like carbon emissions and greenhouse gases in creative ways. How can cities afford these initiatives while remaining competitive? One of the things New York has done is decide not to compete on the basis of being a low tax, low cost, low wage city, but being a high valueadd city. No company cost-cuts its way to market dominance. It does so by expanding the quality of its product, and that depends on the productivity of its workforce and workplace. New York has the highest value-add per employee in the country,
What are the priorities for building resilience? Success itself leads to more problems. In New York City we have one of the highest levels of income inequality in the country. The question is how we create and maintain a city that doesn’t become so fragile that when an unexpected event hits, it breaks apart. To me the solution is to do with creating entry-level jobs that are not dead-end jobs. The real estate industry has myriad opportunities for this, be it in construction, brokerage, basic valuation or technical services. We have these opportunities but our model doesn’t encourage it. We are entering a period of labour shortage. Baby boomers are retiring and millennials are entering the workforce. We need the ability to nurture talent. It also means we have to nurture immigration, or we are going to limit ourselves in terms of GDP growth. Black Swan events Tuesday October 6 17:00 - 17:50 EXPO REAL Forum Hall A2 Stand 540
A Truly Global Industrial Real Estate Platform IDI Gazeley is one of the world’s leading investors and developers of logistics real estate. We have over 26 years of experience and a track record of delivering more than 250 million square feet of innovative warehousing, distribution and manufacturing facilities. Our buildings have long set the industry standard for enabling customers to achieve crucial supply chain efficiencies, from including sustainable elements to locating our facilities at the optimal convergence of intermodal traffic flow and population centers. The company is set for further growth along its three-fold strategy of ground-up development, building and portfolio acquisitions and active asset management. As long-term investor IDI Gazeley are striving to build a global logistics 28 | EXPO REAL 2015
platform with high quality and cost-effective solutions, service excellence, innovation and guaranteed on-time delivery. IDI Gazeley’s investments are targeted at industrial real estate assets in key locations along major logistics and distribution routes in North America, Europe and China. The company’s current assets under management are valued at $3.7 Billion, with a global footprint exceeding 57 million square feet. IDI Gazeley is overseen by Brookfield Property Partners, a $123 billion owner, operator and investor in best-in-class real estate around the globe. As part of the Brookfield Logistics Properties platform, we have the assets and expertise to serve customers in both developed and emerging markets around the world.
Ingo Steves MD & SVP IDI Gazeley Germany Head of Operations Europe & China
Meet us on our stand in Hall B1, stand 200
Coping with external factors in real estate finance All indicators show that the European real estate is running at full throttle once again after recovering from the 2008 crisis. So what are this year’s big issues? Though economies are recovering, turbulence in the political world has made predicting the future an especially precarious business. A series of panels and discussions at EXPO REAL will focus on the big issues facing investors. The effect of external factors such as fluctuating oil prices, exchange rates and the threat of a ‘Grexit’ destabilising the eurozone are the subject of EXPO REAL’s opening event, led by professor Tobias Just, academic director and managing director of IREBS Immobilienakademie at Regensburg University. Shocks The prospect of localised shocks, as seen recently in markets such as Greece and Russia, underline the importance of geographical and asset diversification. In the first of a series of discussions focusing on investments and transactions, Annette Kröger, CEO of Allianz Real Estate, and Andy Rofe, managing director (Europe) at Invesco Real Estate, head a panel analysing how the drive for diversity is influ-
Andy Rofe
Annette Kröger
encing current investment strategies. Later discussions will look at whether the market favours pioneers or investors who follow the crowd, and the question of whether to outsource asset management. The wider issue Big swings in oil prices and exchange rates Monday October 5, 11:00 - 12:15 EXPO REAL Forum Hall A2 stand 540
Tobias Just
of which strategy works best in the current climate will be tackled by Frank Billand, managing director of Union Investment, and Jürgen Fenk of Helaba Landesbank in a German discussion with simultaneous translation. Investment & Transactions October 5 and 6 12:30 – 17.50 EXPO REAL Forum Hall A2, stand 540
Africa as a new real estate investment hotspot When Africa makes the world news, it tends to be for all the worst reasons but investors who look beyond the headlines can find plenty of fertile ground, says Christian Hiller von Gaertringen. Von Gaertringen’s book, Africa is the New Asia, highlights how many countries in sub-Saharan Africa have outpaced western Europe in recent years. Ethiopia has achieved annual growth of around 7% since the turn of the century. Rwanda, which 20 years ago was devastated by genocide, has doubled its GNP in the last 10 years. Major cities such as Addis Ababa and Lagos are urbanising rapidly, creating opportunities for real estate investors - the population of Lagos is forecast to grow from 13 million to 19 million in the next decade.The challenge for Africa, and those who invest there, is to build the infrastructure that allows growth Sub-Saharan Africa Tuesday October 6 14:00 - 18:15 Investment Locations Forum Hall A1 stand 040
An artist’s impression of a new 60,000 seat stadium to be built in Addis Ababa
to continue in a stable way, says Hiller von Gaertringen. Rwanda still derives twothirds of its national income from coffee and tea and needs to diversify; Ethiopia has a string of projects in the pipeline including a national rail network and a 6000 megawatt hydroelectric plant on the Nile. Such ambitious plans will need funding and present
opportunities for bold inward investors. Von Gaertringen’s keynote speech at EXPO REAL will be followed by an afternoon of discussion and debate on real estate development in sub-Saharan Africa – the first time this has been organised at the trade fair. Five sessions will focus on urban development as well as the capital and real estate markets. EXPO REAL 2015 | 29
How to get to EXPO REAL Public transport to EXPO REAL For exhibitors A special MVV travel ticket for exhibitors is available, costing €32.90. The ticket is valid for the period from October 5 to 7, 2015. On these days you can use it to travel on the entire local public transport network (S-Bahn, U-Bahn, bus and tram), including to and from the airport. Use Order Form 8.3 to order your MVV travel tickets or buy them at the exhibition centre, at the MVV counter at the West Entrance. For visitors A ‘Single 1-Day Ticket’ costing €12 covers the entire local public transport network (S-Bahn, U-Bahn, bus and tram), including to and from the airport. You can buy MVV tickets at the ticket machines in the stations or at the West Entrance at the Messe
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München exhibition centre. Just go to the ticket counter there and ask. Our specially trained staff can help you with information and advice on everything to do with public transport in Munich.
07:30 in the morning from 120 hotels in Munich city centre and the suburbs to EXPO REAL and until 19:30 in the evening from the trade fair to the hotels. Free to participants.
MVV-Mobileticket The simplest way to buy your one-day ticket or single-journey ticket is to use the MVV Companion app. Payment is by credit card or direct debit. Your ticket is then saved on your mobile phone.
Navigation system and parking To be directed straight to the exhibition centre, enter the exact address you want: Parking at the North Entrance Paul-Henri-Spaak-Str. 12 81829 München Price: €8 per day Parkhaus West / Multi-storey car park West Paul-Henri-Spaak-Str. 6 81829 München Price: €10 per day
Airport shuttle Get in at the airport and get out at EXPO REAL — shuttle buses run every 30 minutes, non-stop, to and from the exhibition centre. Price: €8 one way, €13.50 return. Hotel shuttle bus During EXPO REAL, there will be a regular hotel shuttle bus service to the trade fair venue. The buses will run every 30 minutes from
North Entrance VIP p a a kACCESS -S t
Download the EXPO REAL app www.exporeal-app.net
GREENZONE
Deggendorf A92
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The area colored green is reserved for vehicles with an emissions sticker.
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30 | EXPO REAL 2015
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The interactive travel planner A quick and convenient way to plan your trip to EXPO REAL: www.exporeal.net/travel-stay/ getting-and-staying-here/
Emissions sticker needed for green zone The city centre of Munich is a green zone, meaning only vehicles with a green emissions sticker are allowed to enter. The exhibition centre lies
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West Entrance
Green zone The green zone is the city centre area bounded by the Mittlerer Ring ring road. The ring road itself is not included in the zone.
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outside this zone, so the sticker requirement will only apply to you if you are travelling into or through this zone.
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Monday 5 – Wednesday 7 October 2015 Opening times for visitors Monday, Tuesday 9.00–19.00 Wednesday 9.00–16.00
Opening times for exhibitors Monday, Tuesday 7:30–19:00 Wednesday 7:30–16:00
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