Thought-provoking analysis of key Real Estate issues.

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Thematic House View

When forecasting real estate performance, as well as making top-down allocation decisions, many asset managers consider two main factors – geography and asset type. However, a number of additional, more thematic factors can differentiate returns and bring another important dimension to top-down allocation. In theory, thematic factors are infinite but they can include the dominance of the asset (size), lease length, covenant strength, asset quality (flexibility/specification/sustainability) and location. While defining these factors can divide opinion on the classification of an asset, what is clear is that at different points in the cycle they have a material impact on performance. In this paper, we use the UK commercial real estate market to assess how these factors can, if harnessed properly, help to deliver enhanced performance and improve decision making.

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The impact of slowing working-age population growth

The developed world is at a turning point – growth in the working-age population has peaked, economies are slowing, and voters are displaying scepticism for immigration. This raises questions over how economies can grow without more people of working age to wield a shovel or tap a keyboard. In turn, this has implications for real estate and the number of new buildings needed in the future. In this paper, we focus on the economic and commercial real estate impacts of slowing growth in the working-age population.

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Global Real Estate Update

A quarterly look at the key themes driving global real estate, plus detailed insight into the regional markets and our latest real estate House View.

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Leisure in the UK Retail Environment

As the digital era has made shopping more convenient for consumers, the need for retailers to deliver a unique physical shopping experience is increasingly important. Leisure (including food & beverage, cinemas and entertainment) has a significant role to play in this ever-demanding retail landscape. In the latest paper from our real estate research team, we examine leisure’s growth as part of a retail offering and seek to establish whether there is a clear link with rental growth. In doing so, we investigate leisure’s influence on both shopping centre assets and major UK town centres.

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Shopping for opportunities in UK retail

The UK retail sector remains under pressure following years of neglect and mismanagement, poor economic conditions and the rise of online retailing. However, the short-term prognosis for the retail sector currently looks better than it has done for some time. The UK is enjoying a reasonably robust economic backdrop, consumer confidence is buoyant and disposable incomes are improving. Against this backdrop, selecting the right assets in the best areas is vital. In this paper, we examine the current state of the UK retail sector and provide proprietary analysis on where we see the best opportunities and those areas to avoid.

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