24,200 real estate and city leaders from 100 countries, including 5,000 investors and financial institutions, came together at the world’s property market MIPIM this week against a background of continued debate on how Brexit will impact the market.
In the midst of political change – fuelled by the US presidential elections, the Brexit vote, elections in France, Germany and the Netherlands – accelerating tech innovation and a growing global urban population, MIPIM chose The New Deal for Real Estate as its central theme, providing industry leaders and investors with the opportunity to discuss evolving real estate strategies.
According to Cushman & Wakefield, the amount of new capital available for global real estate investments stands at $435 billion – lower than in 2016 but still the second highest figure recorded since 2009.
Cushman & Wakefield identified the United States as the leading target for investors, followed by China and the United Kingdom. Real Capital Analytics reported that in 2016, some €30.15 billion of Asian capital headed to the US which invested some €14.4 billion in Asian real estate markets.
At the annual MIPIM RE-Invest Summit, bringing together some 60 representatives from the world’s leading institutional investment funds, two thirds of participants said they would be net buyers in 2017. Combined, the RE-Invest delegates manage over $600 billion in real estate assets.
What was clear at MIPIM this week was that the British government, spearheaded by the Department of International Trade (DIT), in partnership with the British Property Federation, was sparing no effort to reassure investors that Britain’s real estate sector remains a key destination for property investment.
For the first time in the history of MIPIM, the UK government was represented with its own pavilion and Britain’s ‘Invest in Great’ marketing slogan was highly visible. And at 960, the number of UK exhibiting companies and cities increased by 24% compared to 2016.
With the MIPIM doors barely open, senior representatives from Manchester, London, Amsterdam and Stockholm gathered on Manchester’s stand to debate the likely impact of Brexit.
Manchester’s outgoing Chief Executive, Sir Howard Bernstein, said that at a time of uncertainty it was more important than ever for Manchester to promote the fact that it is open for business.
Jules Pipe, Deputy Mayor of London, commented that the UK capital will continue to attract major investment. Referring to Brexit, Pipe noted that “whatever happens, London will come through this.” The Deputy Mayor predicted that if real estate investors seek alternative destinations to London, they are likely to look at New York, Singapore or Hong Kong rather than European capitals.”
Eric van der Burg, Deputy Mayor of Amsterdam, argued that his city’s highly skilled, multi-lingual workforce and excellent infrastructure would attract international companies from the UK to Amsterdam.
Returning to MIPIM for a second time in two years, Valérie Pécresse, President of the Ile de France Region, noted that all the public authorities in the Paris Region were represented in a single pavilion – a sign of a collective approach to attracting international investors and companies. She described the strategy put in place to attract investors and entrepreneurs from all over the world, insisting on the exceptional innovation ecosystem and the depth of the real estate market, as well as on the fact investors now don’t hesitate to bet on Paris Region.
Five years after introducing tech innovation as a part of MIPIM, the MIPIM Innovation Forum moved to the centre of the exhibition hall to host 70 exhibitors across 1,500m². Investment in real estate-related technology was the subject of lengthy discussions as institutional investors sat together at this year’s RE-Invest Summit.
Tech companies competing in the MIPIM Startup Competition demonstrated the wide range of ways the tech industry is moving into real estate. New York’s Envelope won the ‘Cities’ category with its 3D urban map-based software allowing real estate companies to visualise, analyse and run scenarios on development potential under zoning constraints. In the ‘Transaction’ category, London-based Storefront took top prize.
Storefront reports to be the world’s largest specialist in short-term retail for pop-up stores, shopping malls and showrooms. Final winner of the Startup Competition was Ravti in the ‘Building’ category. The US company produces software that tracks, manages and procures heating, ventilation and air-conditioning for CRE owners and operators.
“When tech elements were introduced to MIPIM some people were slightly bemused. Today, crowdfunding, big data, virtual reality, the internet of things, smart cities and smart buildings are part of the world of real estate. The growing influence of tech companies on the property sector has encouraged Reed MIDEM to launch the MIPIM PropTech Summit in New York on October 11, 2017, in partnership with MetaProp NYC,” said MIPIM Director Ronan Vaspart.