Monthly Archives: February 2011

ProLogis signs major deal in Budapest

Hopi Hungary has signed a lease agreement for 20,500 sqm of warehouse space ProLogis Harbor Park, extending its lease from Building L to Building J as well. Hopi was using Building L to provide services for Unilver ath the park which sits adjacent to the M6 motorway to the south of Budapest. The situation on industrial sector has been looking up as late, with the pace of leasing deals rising considerably.

Cushman & Wakefield reported that take-up improved in 2010 to 2.5m sqm, compared to just 1.8m sqm in 2009. On the other hand, the agency points out that output fell by over 1m sqm to just 580,000 sqm.

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Orco and Millenius end dispute

Remember all that fuss earlier in the year over Milenius and its attempts to unseat JF Ott from the helm of Orco Property Group? Don’t bother. It’s apparently not an issue any more:

Millenius, Fideicom, Clannathone and Bugle have formally and irrevocably agreed to withdraw from these legal proceedings and abandon the positions they took during the course of these proceedings. Orco Property Group has accepted their withdrawal and abandonment without reservation.
Jean-François Ott – President and CEO stated: “While the Company has solid legal arguments at its disposal to obtain a legal victory, I am pleased with this agreement that formally ends the legal proceedings brought against us and thereby allows us to avoid the time and expenses that would have been needed to sustain a long legal process.

The full statement from Orco is here.

Immofinanz issuing €550m in convertible bonds

Immofinanz will be selling €550m in convertible bonds to help finance its bonds that come due between 2014 and 2107. If you own shares in the company, you’ll get first crack at the new issuance, whose conversion price could be 30-40 percent above the current share price, and whose coupon could be over 3%. This would allegedly complete the financial restructuring following the company’s descent into distress in 2009. Immofinanz was merged with Immoeast, reams of assets were sold and a totally reshaped management structure was installed. Proof of this could come at the end of 2011, as dividend payments to shareholders are now being hinted at.

C&W’s McCarthy: US economy shifting to high gear

Today’s dose of optimism comes from Cushman & Wakefield’s US operations, via a blog post by its senior economist Ken McCarthy. He says his cautious optimism a year ago was met with scepticism, but that events are proving him correct.

After US GDP increased at a 1.7% annual rate in the second quarter and 2.6% rate in the third quarter, the consensus just a few months ago was that the economy would continue to grow slowly in 2011. Today forecasters are racing up revise their forecasts upward. I wouldn’t be surprised to see US GDP growth of 4.5% in 2011 with payroll employment growth somewhere in the 3.0 million range. The US economy is about to shift into high gear.

It’s easy to discount optimists, but if that becomes the overriding mood of the market, it can be dangerous to fight the tide. Just look at the profits you could have made if you’d invested in stocks a couple years ago. But that’s a different sort of debate. Read the whole post here.

CB Richard Ellis to buy ING REIM

ING  has reached agreement to sell the majority of its ING Real Estate Investment Management business (ING REIM) in two separate transactions for a combined price of approximately USD1bn (€770m). As part of the overall transactions, ING has also agreed to sell up to approximately USD100m of its equity interest in existing ING REIM funds.

ING has entered into an agreement with CB Richard Ellis Group, Inc., to sell ING REIM Europe, ING REIM Asia and Clarion Real Estate Securities (CRES), ING REIM’s US-based manager of listed real estate securities, as well as part of ING’s equity interests in funds managed by these businesses. The proceeds for these REIM businesses and the equity interests amount to approximately $1bn.

ING REIM Europe, ING REIM Asia and CRES combined have €44.7bn in assets under management as of 31 December 2010. Continue reading

Nordic liquidity on the way

Interesting story in the FT about Nordic property funds getting back into the game.

Nordic pension funds enthusiastically embraced opportunities in indirect real estate all over the world in the years leading up to the crisis, but were faced with a backlash as the markets began to tumble. Between 2008 and 2009, some investors saw the value of their indirect property portfolios dropping by about a third.
“Investors have in some sense rethought why they were getting into property in the first place. They are going back to core property investments for the risk and returns people thought they were going to get and drifting towards lower leverage. Some want to avoid leverage completely,” says Russell Chaplin, chief investment officer for property at Aberdeen Asset Management

Not all of these stories have to come off 100% in the end for there to be an impact. The more we hear about funds and investors getting back into property, the greater the level of liquidity in the market. With lots of financing coming due this year, that can’t happen soon enough. Full article here.

IVG profits jump in 2010

IVG says that after making a loss of €158m in 2009, it had net income of €23.2m in 2010. This “clearly demonstrates the success of the restructuring program that was initiated in early 2009,” writes the company in a statement. Continue reading