Value, in real estate investing, is one of the most talked about concepts. It is what investors strive for, what investment managers hope to deliver and what developers aim to produce. But for all the talk and interest in the subject, for all the attention directed to measuring it and assessing it, there is relatively little understanding about how value is actually created.
From the Current Issue
Allianz Real Estate GmbH is the investment and asset management company used by Allianz companies around the world to invest and manage their real estate portfolios. Allianz currently has around Ä17 billion invested in real estate, primarily in offices across Europe. Olivier Piani, former president and CEO of GE Real Estate Europe, joined Allianz in September 2008 as its CEO with a goal to integrate, grow and diversify the insurance company’s real estate allocation. Sheila Hopkins, a senior editor at Institutional Real Estate, Inc, met with Piani at MIPIM and discussed his plans for Allianz.
Falling asset values and drastically reduced transaction activity. Sound familiar? Europe’s multifarious residential housing markets may not be a big target for institutional real estate investors but are of interest in normal times as they offer a diversification and return play against commercial real estate markets and investments. But times are not normal. Recession has come to residential and, just as with economies around the world, appears to have come at the same time to all the major markets. There is seemingly no escape. Recession has an inbuilt ability to find bubbles, burst them, cause chaos and create havoc, and residential property is no different
The banking crisis and ensuing economic environment has had a devastating impact on global real estate investment, with many markets suffering substantial declines in value over the past 12 to 18 months. While few predicted the scale of re-pricing, it was widely recognised that many real estate investment markets were not in equilibrium and that something had to happen for them to revert back to a more sustainable position.