According to Knight Frank’s Global Prime Residential Forecast, the projections for prime prices in 2023 and 2024 have been revised upwards. The 2023 forecast was initially 1.7%, revised to 2.4%, while 2024 was initially 2.1%, now 2.5%.

The factors set to shape 2024

The tumultuous 2023 has been characterised by global conflict, soaring inflation and interest rates, and general uncertainty.

But among the expectations for 2024, the report found headwinds may be easing, the proportion of cash buyers rising, and elections are the biggest risk to prime markets for next year.

The report found that cash sales rose from 46% to 52% in the last six months.

Politics and regulations are both a major hurdle and potential boon. On the one hand, tighter controls around energy, sustainability, and holiday letting may be concerns going into 2024, but on the other hand, relaxation of property and tax regulations may be an opportunity.

Upcoming elections include the Indian General Election (before the end of May 2024), US Presidential Election (November 2024), UK General Election (before January 2025), Canadian General Election (Before October 2025), and Singaporean General Election (before November 2025).

The report also found that the increase in demand is expected to be small, likewise the increase in supply, sales, and foreign buyer activity.

Melbourne and Sydney in top ten for price growth forecast

The Sydney luxury property prices are forecasted to rise five per cent next year, fifth behind Auckland, Mumbai, Dubai, and Madrid.

Melbourne came in at eighth in the world, with prime residential property prices predicted to increase by three per cent.

Perth and the Gold Coast are also forecast to see luxury homes rise in value, up four per cent each.

Source: Knight Frank Research.

Knight Frank head of residential research in Australia, Michelle Ciesielski, said cautious optimism was emerging in the luxury residential property market globally, with prime buyers appearing confident that economic headwinds were easing.

“In Australia, buyer appetite is strengthening, while supply of prime properties is constrained,” she said.

“The limited number of exceptional and most desirable prime residential property listings continues to create a price floor under many luxury Australian properties.

“This undersupply of luxury homes is one of the key factors set to shape the performance of the Australian prime residential market in 2024, with inflation and interest rates also set to play a big role.”

Michelle Ciesielski, Knight Frank

“In saying that, in this upper echelon of the market, we are seeing an increasing number of cash buyers, with the proportion being 60% of all prime residential property sales in Sydney and 65% in Melbourne.

“Climate risk, geopolitical tensions and currency shifts are also expected to impact the Australian luxury property market.

“Amongst these risks there are opportunities, however, with property set to continue to appeal as a means to diversify and spread risk, being seen as a safe haven for capital.”

Knight Frank head of residential in Australia, Erin Van Tuil, noted that the super-prime end of the market, especially A$20 million plus, is doing exceptionally well, with no shortage of buyers and limited homes.

“Most buyers are local Australian buyers, with a notable absence of foreign buyers committing to sales, despite enquiries.

“Relative to other Australian cities, Melbourne has counted more prime luxury product built over the past couple of years, which has made prime prices lag the stronger performance in other Australian cities.

“Melbourne is also still recovering from an extended lockdown in the pandemic, with the city seeing many residents move interstate to Queensland and the slower return of international investors which the city relies heavily on.”

Source : ThePropertyTribune

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LONDON, Dec 6 (Reuters) – UK investors pulled money from real estate funds for the second month running in November, but sentiment towards equity and fixed-income funds improved, fund network Calastone said on Wednesday.

Investors withdrew 88 million pounds ($110.70 million) from real estate funds overall last month, making it the second-worst month of the year for property funds after August’s 121 million-pound net outflow, according to Calastone’s data.

The property outflows were driven by a decrease in buy orders, while sell orders remained almost unchanged, Calastone said.

Property faces a “triple squeeze” of weak tenant demand in commercial property, high interest rates hitting capital values, and high finance costs hurting profit margins, said Edward Glyn, head of global markets at Calastone.

Real estate firms around the world have come under strain as higher interest rates have driven up the cost of funding.

The Bank of England raised interest rates 14 times in a row between December 2021 and August this year. It paused its increases in September.

Jefferies analysts said in September that London’s office market was in a “rental recession” as empty workspace hit a 30-year high.

“Until we see a decisive turn in the UK’s growth prospects, commercial property is likely to continue to struggle,” Glyn said.

UK investors showed more confidence in equity funds, which posted net inflows of 449 million pounds in November, Calastone said. This was a tentative turnaround in the wake of 4.5 billion pounds of overall outflows between May and October, Calastone said.

There were still outflows in ESG equity funds, which lost a net 524 million pounds in November. But fixed-income posted “modest” net inflows for the first time in four months, gaining 256 million pounds overall, Calastone said, attributing the change to a decline in bond yields.

Source : Reuters

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“Even though there is a lot of pessimism about the state of inflation and weakening economic conditions, there are also a lot of people with the capacity to buy despite higher interest rates,” she said.

“Some of the upsizers who might be participating in the market may have had longer term capital gains they’re able to spend on the next purchase. Wealthier households and cash buyers such as downsizers are able to participate in the market despite rising rates as well.”

But Owen said the pace of growth was slowing in Sydney and Melbourne as stretched affordability and limits to borrowing capacity started to kick in.

More homes have been listed for sale in the winter and spring, and total listings are now slightly above their historic average, giving buyers a little more bargaining power, she said.

“In Sydney and Melbourne, ongoing price growth is going to be more tested in the months ahead,” she said.

“Seasonally we’re going to see lower volumes and demand. Prices may be affected by the November rate rises. There is a little uncertainty around cash rate expectations.”

But in more affordable cities Brisbane, Adelaide and Perth, prices are running at high speed and rising in more than 95 per cent of markets analysed. Total listings remain between a third and 40 per cent below average there, and price growth remains strong.

AMP chief economist Shane Oliver noted the shortage of homes compared to demand, which buoyed property prices this year after last year’s downturn.

“There’s a group of people who are less interest rate sensitive, who can access the bank of mum and dad, or had built up a lot of savings and were waiting for prices to stop falling before going in,” he said.

“As more people see prices going up, they’re attracted to the market because they feel they’ll miss out if they don’t get in.”

Even so, he said Sydney prices have been slowing a bit and Melbourne has lagged relative to elsewhere, while Perth, Brisbane and Adelaide prices stay at record highs.

Auction clearance rates have fallen since autumn, and there is a question mark over the outlook, he said.

“There’s an increasing risk that high interest rates with the still high risk of another hike may start to get the upper hand,” he said.

HSBC chief economist Paul Bloxham said strong population growth, particularly from overseas, was helping to push house prices higher.

A tight rental market, made tighter by international students and workers travelling to Australia, was encouraging local renters in Sydney and Melbourne to buy rather than continue renting, he said.

“One of the primary forces supporting housing demand at the moment is strong population growth,” Bloxham said. “We do think population growth will slow down in the next few quarters and that will help in easing house price growth.”

Bloxham said the surprising thing about the current market was the fact interest rates had soared, but house prices were also still rising.

“That’s because of a lot more people in the market,” he said. “It’s offsetting the higher interest rates.”

Source : TheSydneyMorningHerald

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In the ever-evolving global investment landscape, investors are continuously drawn to new opportunities that offer value, stability, and growth. Dubai, known for its exceptional quality of life, unmatched safety, strong connectivity, tax benefits, and business-friendly environment, has emerged as a prime destination for international investors, particularly those from the United States.

This burgeoning appetite is not incidental but a calculated alignment with value, opportunity, and security that the city offers. When juxtaposed with other global cities, Dubai’s property prices not only stand competitive but also promise appreciable returns on investment.

Prime property prices in Dubai are notably cheaper by 20 percent-80 percent when compared to major cities such as Monaco, Hong Kong, New York, London, Geneva, Paris, Beijing, and Tokyo, even amidst a massive increase in rates during the post-pandemic period. A million dollars can secure a luxurious property in Dubai with an area of over 100 square metres (sqm), in stark contrast to 17sqm in Monaco, 21sqm in Hong Kong, and 33sqm in New York.

Moreover, the introduction of investor and golden visas through property acquisition has further sweetened the investment proposition, ensuring investors not only gain financial returns but also a gateway to global mobility and an enhanced lifestyle.

With a substantial diaspora from the MENA region, the U.S finds a cultural and economic bridge in Dubai, making it easier for investments.

A top FDI destination

Dubai’s ascension as a global leader in attracting Foreign Direct Investment (FDI), especially in future-oriented sectors, is noteworthy. The city, under the visionary leadership of Sheikh Mohammed bin Rashid Al Maktoum, UAE Vice President and Prime Minister, and Ruler of Dubai, has forged dynamic partnerships with international investors, accelerating innovation and creating enduring economic value.

In 2022, Dubai not only maintained, but solidified its position as the leading destination city globally for greenfield FDI projects, with 837 announced projects, according to the Financial Times ‘fDi Markets’ data. This achievement, amidst global uncertainty and economic challenges, is a testament to the city’s competitive strengths and attractiveness.

Moreover, the comprehensive strategy of the Dubai Economic Agenda (D33 Agenda), which aims to double the size of Dubai’s economy over the next decade, is set to further elevate the emirate’s status as a preferred destination for major international companies, investment, talent, and visitation.

In 2022, the US ranked third for FDI in Dubai, accounting for 11 percent, with many investors having recognised and leveraged the multifaceted opportunities offered by this vibrant city. The strategic geographical positioning, coupled with a robust economic and technological infrastructure, makes Dubai a pivotal axis in the global economic machinery.

As we navigate through the complexities of global investment terrains, Dubai emerges not merely as a viable but as a compelling destination for U.S. investors. At Berkshire Hathaway Home Services (BHHS), we are not only witness to this transformative investment wave but are also active participants, facilitating U.S. investors in navigating through Dubai’s promising property market.

Source : Zawya

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Market observers said Sunac’s restructuring plan can set a positive example for the domestic real estate sector, and it will also help the company to resume normal operation.

According to the announcement, a total of about $10.23 billion of debt has been converted into new notes, mandatory convertible bonds, convertible bonds and Sunac Services shares.

The converted new notes, mandatory convertible bonds and convertible bonds will be listed on the Singapore Exchange on November 21. Sunac Service shares have been transferred to the relevant creditors, said the announcement.

At the end of October this year, Sunac achieved contracted sales value of 75.78 billion yuan ($10.57 billion), down 50.49 percent year-on-year. The contracted sales area amounted to approximately 5.403 million square meters, with a contracted average selling price of approximately 14,030 yuan per square meter.

By the close of trading on Monday, Sunac’s stock price had risen by 5.91 percent to HK$2.33 per share.

Sunac’s debt restructuring plan is innovative and pragmatic, fully taking into account the current changes in the industry, according to a report by media outlet jrj.com. it also protects the company’s sustainable operations and provides several financial options for creditors, setting an example for debt restructuring for other embattled firms in the industry, the report said.

Since late 2021, over 50 listed property developers have initiated debt restructuring proceedings. Sunac was the first large developer to complete its overseas debt restructuring, said the report.

Source : GlobalTimes

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The posh London mansion that billionaire businesswoman and pop star Rihanna rented for £18,000 (US$21,895) per month while she lived in the British capital has just sold for £27.5 million.

The A-lister called the pad home for some two-and-a-half years—during which the more than 6,300-square-foot home’s contemporary interiors appeared across her social media channels—before moving out in 2020, Mansion Global previously reported.

Fully refurbished and modernized, the eight-bedroom home is St. John’s Wood, a leafy upscale neighborhood north of Regent’s Park that’s full of townhouses and megamansions.

It’s also “the only one of Royal architect John Shaw’s original villas on St. John’s Wood Park to have survived into the 21st century,” said Stephen Lindsay, the head of the North London and St John’s Wood office at Savills, which had the listing with Aston Chase.

The house has a number of reception and family rooms, alongside formal and casual dining rooms, a study, a family kitchen and a gym. There’s plenty of outdoor space too, in the form of a terrace and a sizable rear garden.

There’s also planning permission in place to expand the home to 16,000 square feet, nearly tripling the interior space, and allowing a basement with a pool and spa, according to the listing.

The “We Found Love” singer is not the only notable resident to have called the manse home. Diamond tycoon Daniel Francis, a shareholder at De Beers in the mid-1800s, was the original owner of the five-story mansion.

The house was purchased by a family from overseas, according to the brokerages. Mansion Global couldn’t identify the sellers.

Friday’s sale equated to £3,500 per square foot, a record price for the St. John’s Wood area,” said Mark Pollack, co-founding director of Aston Chase. It reflects “the substantial planning consent obtained, the large plot and the secure carriage drive, which are amenities normally associated with homes further out in the suburbs of London.”

A representative for Rihanna couldn’t immediately be reached for comment.

Source : MansionGlobal

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Sweden’s real estate crisis is proving a boon for a fund that’s preparing to deploy more of its $1.9 billion cash balance snapping up properties from desperate landlords.

Nrep, a Nordic fund that’s part of the Urban Partners investment group, is looking to capitalize on heavily indebted firms such as Samhallsbyggnadsbolaget i Norden AB and Heimstaden Bostad AB as they race to divest properties they can no longer finance using expensive bond debt.

“There are some things around Sweden in the way it’s been financed and how the structure around the market looks that make the country quite compelling,” Urban Partners Chief Executive Officer Claus Mathisen, 51, said in an interview in Copenhagen.

Mathisen, whose fund’s three biggest deals accounted for 15% of the volume of commercial properties changing hands in Sweden this year, expects to see more transactions with real estate companies still struggling to refinance $25 billion of maturing bonds through 2025.

“The amount of inbound interest and dialogs has never been higher than it is now,” he said.

Nrep is planning to take advantage of a transaction market that has slowed considerably as sellers and buyers struggle to agree on prices. Only 64 billion Swedish kronor ($5.8 billion) of properties have traded hands so far in 2023 — that’s down nearly 60% compared to the same period last year.

“Investing when others are not able to — if you have conviction, courage and capacity — is a great time to act,” Mathisen said.

So far in Sweden this year, Nrep has bought two office properties in Stockholm from Fabege AB, a 51% stake in Klovern AB and a portfolio of care homes from Vectura Fastigheter AB, among other deals. While the assets had been tracked for a long time, Mathisen says that current market decisions made the deals “nice to pursue now.”

Nor do the group’s ambitions end there. In May, Urban Partners raised €3.65 billion for a fund targeting properties mainly in the Nordic region, taking its total assets under management to €20 billion. The investment vehicle is now at its “highest ever capacity” in terms of capital and people, according to Mathisen.

Nrep’s interest in the region forms part of a wider trend where well-capitalized institutional investors such as Brookfield Asset Management Ltd. are replacing listed property companies as buyers of assets. Sweden has seen an increase of capital inflows this year as foreign buyers stand for 30% of purchased deals but only 11% of the divestments, according to data from Colliers Research.

The inflows have come against a surprisingly resilient backdrop for commercial property prices in Sweden, despite higher interest rates and one of the world’s worst routs in home prices. However, analysts at Nordic Credit Ratings expect downward pressures to intensify as price expectations become increasingly aligned. It’s a view shared by Mathisen, who says sellers and buyers are now meeting at lower price levels.

“It’s completely a buyers’ market,” Mathisen said. “It’s going to wobble along, but we’re not investing to sell 12 months from now. Our current funds have five to 10 years left.”

Source : Bloomberg

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Lincoln Property Co., owner of established Dallas residential staple The Village, unveiled its new global headquarters, located at 8111 Douglas Avenue in Dallas. Completed this year, Lincoln led the development of 8111 Douglas, a mixed-used project comprising two 13-story towers. The office building provides 225,000 square feet of Class A office and retail space, while the residential tower includes 128 luxury apartments averaging 1,400 square feet. The new office tower is part of a mixed-use project developed by Lincoln that includes a luxury multifamily high-rise and amenities that include a penthouse meeting space with panoramic city views, an on-site gym and pickleball court.

Including its Dallas headquarters, Lincoln operates 35 offices across the U.S. and Europe. This project was completed under the leadership of co-CEOs Clay Duvall and David Binswanger, along with a strategic investment from Stone Point Capital.

KERA and Kaizen Development Partners Announce Development Partnership in Uptown

As part of the partnership, Kaizen will purchase 2.4 acres of KERA’s property on the southern end of the site in Uptown for its new residential and Class AA office towers and will oversee its development, including the construction of KERA’s planned headquarters on the remaining northern end of the property. Since its launch in 1960, KERA has been located at Harry Hines Blvd. in Dallas. The two organizations have signed a Purchase and Sale Agreement, with plans to break ground at the end of 2024. Law firm Vinson & Elkins L.L.P. represented KERA in the transaction. JLL’s Blake Shipley, T.D. Briggs, and Ayanna Jarvis have been retained to lead the leasing efforts for Kaizen’s 400,000 square-foot office tower. This will be accompanied by the residential tower and 20,000 square feet of restaurant and retail space with an expected delivery in 2027.

Ahead of breaking ground in 2024, KERA will temporarily relocate from its current location while a new facility is constructed on their existing site adjacent to the Katy Trail. KERA has selected Corgan to design the new facility, focused on content creation and community engagement. Gardiner & Theobald will serve as project manager. Lucy Billingsley, KERA board member and facilities task force chair, led the process to find the right design partner for the public media organization.

KERA’s new building will also serve as headquarters for its satellite locations. In the last several years, KERA has launched journalism collaborations including leading The Texas
Newsroom, a statewide journalism hub for public media stations; a collaboration with the digital nonprofit news service, The Fort Worth Report; and Arts Access, a partnership with The Dallas Morning News to expand arts journalism in North Texas through the lens of equity and access. KERA also entered into a management agreement with the city of Dallas for classical station WRR and purchased the Denton Record-Chronicle. As part of the operating agreement with the city, WRR will continue to broadcast from its studios in Fair Park for the next several years. Additionally, the Denton Record-Chronicle will remain located in Denton.

KBS and TRS Lease Space at Providence Towers

KBS, one of the largest owners and operators of premier commercial real estate buildings in the nation, and Transwestern Real Estate Services have signed 38,501 square feet in lease agreements with two regional firms at Providence Towers, a 524,143 square-foot Class A office building located at 5001 Spring Valley Road in Dallas. This transaction includes the expansion of Tower Street Insurance from 5,000 square feet to 24,399 square feet and a new 14,102 square-foot lease with Fieldwork. KBS is undergoing a multi-million-dollar renovation of the property that includes various indoor amenity upgrades. In 2021, the firm completed a tenant lounge and café and is currently underway on renovations for an upgraded fitness center, expanded conferencing facility, and common areas. The renovated tenant lounge includes amenities such as lounge with a fireplace, collaborative working space, pool tables, shuffleboard, and a private dining room. Additional Class A amenities at the property include a wine bar and putting green. KBS was represented by Transwestern’s Kim Brooks, Justin Miller, Scott Walker, and Laney Delin in the lease negotiations.

Pillar Commercial and OliveMill Holdings  Form Joint Venture to Acquire Pinnacle Point in Southlake

Via a joint partnership, Pillar Commercial and OliveMill Holdings have acquired a three-building, 81,259 square-foot Class A creative office/flex complex in Southlake along S Kimball Avenue in Southlake, Texas. These three buildings are each approximately 27,000 square feet, sitting on more than 7 acres of land. One of the three buildings is move-in ready with multiple office suites, while the other two buildings offer potential tenants the option to finish out as office or light industrial spaces. Amenities include general or creative office suites and light industrial spaces. Parker McCormack with JLL represented the seller on the sale. Security National Bank is providing senior debt financing for the acquisition.

Granite Park 6 Opens in Plano

Commercial real estate investment, development, and management company, Granite Properties and Highwoods Properties, a publicly traded real estate investment trust, announced the opening of Granite Park 6. The 19-story, 422,109-square-foot Class-AA office is located at 5525 Granite Parkway. It is the seventh office development in Granite Park, Granite’s 90-acre, 2.3 million square-foot, mixed-use development.

Granite Park 6 is designed by BOKA Powell with modern interiors by HKS Architects. General contractor, Austin Commercial, kicked off construction on Granite Park 6 in December 2021, wrapping up in October 2022. Granite Park 1–5 are 92 percent leased.

Current Granite Park 3 customer, Stonebriar Commercial Finance, is scheduled to move their two-floor headquarters to Granite Park 6 in December 2023. Amenities in Granite Park 6 include a two-story lobby with curated piano music, a market café, a three-story monumental staircase connecting to the lecture hall; a 150-seat lecture hall offering theater-style seating along with three conference rooms; a sixth-floor landscaped amenity terrace connecting to a fitness studio, indoor customer lounge, and golf simulator; and contactless smart card access throughout the building as well as hands-free entry doors, and hands-free fixtures in restrooms.

Highwoods is Granite’s joint venture equity partner for Granite Park 6, leased by Robert Jimenez, Burson Holman, and Elizabeth Fortado.

World Wide Commercial Brokers the Sale of Crown Plaza

Niveen Widyan, Laura Bailey, and Jerad Rector of Worldwide Commercial brokered the sale of the Crown Plaza portfolio, a three-property, 87,973 square-foot office and flex portfolio in Farmers Branch. Worldwide Commercial represented the seller. The buyer was unrepresented.

Source : Reuters

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Leading UK property investment specialists API Global will be attending CityScape Global in Saudi Arabia, in collaboration with UK property developers Elevate Property Group and Investin PLC.

The event, which runs from Sept. 10-13, will see API Global showcase its extensive UK buy-to-let property portfolio to the exhibition’s 180,000 attendees. Following this, the company will launch its eagerly anticipated second office in Saudi Arabia.

With rental demand in the UK at an all-time high, developers across the UK are looking to build more stock to capitalize on the surge in rentals and deliver strong returns for investors both in the UK and overseas. API Global helps investors build passive income through property with their sophisticated end-to-end solution.

With a strong development portfolio, including off-plan, completed, and below-market-value stock, investors can maximize their capital growth from Day 1 of their investment, the company claims.

Michael Leighton, CEO of API Global, said: “API is a truly global business, serving property investors across the UK and the Middle East. We’re proud to work with some of the best developers in the UK, including Investin PLC and Elevate Property Group, to bring high-quality developments to the market.

“We’re the UK’s leading property investment company, and opening our Saudi office will further solidify our position and attract more investment into the UK.”

He added: “If you’re attending CityScape Global, please make sure you pay a visit to the API Stand at H1 V11, near gate 3.”

Census data reveals the scale of the shift in the UK housing market, with the number of households renting in England and Wales more than doubling since 2001. Five million households are now renting privately compared to 1.9 million in 2001, and homeownership rates have fallen from 64.1 percent in 2011 to 62.3 percent in 2021. Looking at more specific markets, hotspots such as London, Birmingham, and Manchester are going through a period of unprecedented, sustained growth. Across the UK, rents have increased by an average of 11 percent, rising to 15.8 percent in London and more than 23 percent in Manchester. In London, rents are increasing at their highest-ever rate, and outside the capital, average rents have reached another new record of over £1,100 pounds ($1,385) per month.

API Global has had an office in the Middle East — in Dubai — since the company’s inception in 2013, serving expats and locals alike looking to invest in one of the most stable and secure asset classes in the world: UK property. Looking to expand further into the region and to cater to the increased demand for their end-to-end investment and management service, API Global is now ready to open its second Middle East office in Saudi Arabia.

Source : ARABNEWS

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