Articles 1 to 10 of 10
Bumps in the Road: India's Industrial Growth Seeks Solid Ground
Indian business's voracious appetite for land to support rapid growth is running up against farmers determined to get top dollar for their acreage. One conflict recently got so messy in West Bengal that Tata Motors pulled up stakes for its planned Nano plant and will now relocate it in Gujarat. Behind the disputes lie outdated laws and the lack of any pragmatic negotiation structure that might give both sides more of what they want. Experts tell Knowledge@Wharton that a comprehensive set of ground rules may finally be on the way.
Indian Real Estate Firms Face a Reality Check
Real estate stocks have been hit hard during the current stock market meltdown. In addition, home prices have fallen by as much as 25% in certain urban markets. This is a new phenomenon in India, where boom and bust cycles in property markets have rarely occurred in the past. Rising interest rates and loss of jobs in the financial sector are squeezing demand, and home foreclosures have begun in some areas. Will the hard times continue? According to real estate experts interviewed by India Knowledge@Wharton, despite the present slowdown, sound reasons exist for optimism in the long run.
Indian Real Estate: Investors Are Shopping, but Are They Buying Hype?
Drive through any of India's major cities and it will be impossible to go a mile without encountering brightly colored cranes and hordes of construction workers. Commercial high rises, residential townships, industrial parks and shopping malls are exploding into existence, fueled by both long-term and speculative investors. But astute industry watchers are poking holes in that picture, pointing to the relatively small size of actual investments, sharply reduced expectations of returns and continuing concerns about the country's regulatory environment. India Knowledge@Wharton spoke with foreign and domestic private investors, property developers and brokerage firms about these issues.
For Surendra Hiranandani, the Future of Indian Real Estate is 'Definitely Bullish'
While foreign capital rushes into the Indian real estate market, the long-term future of the industry lies in the hands of Indians themselves, according to Surendra Hiranandani, founder of the Mumbai-based Hiranandani Group. He spoke with India Knowledge@Wharton following his appearance on a panel about "Global Hot Spots" during a meeting hosted by Wharton's Samuel Zell and Robert Lurie Real Estate Center.
Why U.S. Investors Are Building Their Hopes on Indian Real Estate
Government policy changes that allow 100% foreign investment in property development and the lure of double-digit returns have made Indian real estate an attractive opportunity for U.S. institutional and high-net-worth investors. What's a trickle now by global standards promises to increase in flow as firms such as Goldman Sachs, Morgan Stanley, Merrill Lynch and GE are either investing in Indian real estate or doing due diligence into potential ventures. Caution, however, tempers their optimism. Their worry list includes issues such as getting comfortable with local partners, exit options, realistic pricing, market intelligence and receding rates of return, say experts from Wharton and elsewhere.
Commercial Real Estate's Perfect Storm: What Lies Ahead?
The commercial real estate market has been on a tear in the last few years. Banks, insurance companies and institutional investors have funneled money into the market because its returns, in an environment of low interest rates, exceeded those of other asset classes. As interest rates begin to climb, how will that situation change? Experts discussed those issues at a recent conference on Innovation and Risk Management in Real Estate Markets organized by the Wharton Financial Institutions Center and Mercer Oliver Wyman.
Epidemics in an Integrated Global Society: An Economist's View
When Severe Acute Respiratory Syndrome (SARS) broke out in Hong Kong in 2003, some media outlets predicted economic calamity for the city. But by one financial measure -- real estate prices -- Hong Kong hardly suffered, according to research by Grace Wong, a Wharton real estate professor. In two papers titled, "Has SARS Infected the Property Market? Evidence from Hong Kong" and "Is SARS a Poor Man's Disease? Socioeconomic Status and Risk Factors for SARS Transmission," Wong looks at SARS' impact on real estate values and analyzes the role of income in determining who contracted the disease. Underlying her research is the recognition that in a global economy, infectious diseases such as SARS will likely spread farther and faster as people travel all over the world in search of new business opportunities.
Is Commercial Property Still a Good Investment?
These are blissful times for commercial real estate investors. Having fallen into a deep slump with the ending of the Internet boom, the market has come surging back. In 2004 alone, prices rose 26% for apartment complexes, 21% for industrial properties, 14% for retail properties and 6% for office buildings, according to Real Capital Analytics, a New York real estate research firm. At the same time, however, a number of major institutional and private investors have been selling off large chunks of their portfolios of prime commercial real estate and putting the sale proceeds into less expensive real estate or into other assets entirely. Wharton experts and others look at real estate's revival as well as its risks.
Real Estate Developers Can Expect Relocation, not Dislocation, from the Internet
There’s no question that e-commerce has changed the demand for real estate. Consider Amazon.com which has no presence in malls or shopping centers but last year searched for one million square feet of warehouse space in New Jersey alone. It’s just one example of the new opportunities that the Internet can offer real estate developers who are logged into the e-commerce landscape. A recent Wharton Real Estate Center membership meeting discussed the synergies between real estate and the Internet.
Global Property Deals, CMBS and All That
What do you need to know if you want to build a five-star hotel in Baku? Thomas Pritzker, chairman of Hyatt Hotels and Resorts, spoke about the promises and pitfalls of investing in the global real estate market at a recent conference organized by Wharton's Zell/Lurie Real Estate Center. Other issues that came up for discussion: The future of commercial mortgage-backed securities, the impact of technology on real estate, and value creation in real estate.
