Since winning the 2008 Summer Olympics bid in 2001, Beijing has set out to transform itself from a smoggy, Third World city to a First World metropolis of the future. To that end, the government has put approximately $41 billion of public funds into infrastructure improvements and new athletic facilities, and has encouraged private investment in office, retail and hotel assets. The result, according to researchers and public administrators, is a city poised to compete with any major city in the world.
From the Current Issue
The number of private equity real estate funds pursuing opportunistic returns amid the fallout from the credit crunch continues to grow rapidly. In a recent position paper, fund of funds manager Clerestory Capital Partners argues that “equitable terms” for all investors is a principle worth defending.
As share prices fell nearly 20 percent in 2007 from their previously lofty levels, public REITs that own commercial properties saw total returns drop an average of 15.7 percent for the year. Likewise, values of securities backed by commercial mortgages fell fast as the credit crunch took hold during the second half of the year, with the devaluation only accelerating as bond yields further skyrocketed during 2008’s first quarter.
As the worldwide amount of digital information expands, demand for data centers will continue to grow. Supply of such centers is currently lagging demand, particularly in major urban centers, where low vacancy rates are driving strong rent growth. This trend will continue in the near term, facilitated in part by the high cost of new data center construction.
Alexander Garvin has an extensive background in urban planning and real estate. From 1996–2005 he was managing director of planning for NYC2012, New York City’s committee for the 2012 Olympics bid. During 2002-2003 he was the vice president for planning, design and development at the Lower Manhattan Development Corporation, the agency charged with the redevelopment of the World Trade Center following 9-11. Over the past 35 years he has held prominent positions in five New York City administrations. Currently he is president and CEO of Alex Garvin & Associates, and he is the adjunct professor of urban planning and management at Yale University.