Friday, March 9, 2012

Reporting from MIPIM: Optimism with a new vocabulary

Reporting from MIPIM: Final thoughts on the wrap-up keynote presentation to end MIPIM 2012 from one of our students:

Here we are, the final day of MIPIM. It seems that the champagne-and-caviar yacht parties have finally taken a toll on the attendees. The crowds have thinned out, my fellow Badger students and I are exhausted but ready to attend the pièce de résistance, the keynote speech by our rock star dean François Ortalo-Magné.

We had spent the previous day conducting a survey measuring the general sentiment of MIPIM attendees. Those findings coupled with the information we've been hearing and sharing during our daily debriefs, we are looking forward to the culmination of this great effort.

We met at the Le Corbusier hall, named after the famed early 20th century French architect Charles-Edouard Jeanneret. François was joined on stage by Mark Roberts from RREEF Real Estate. Mark presented raw global economic data and projections specific to the real estate sector. The graphs clearly indicate and support the idea that core holdings are a safe haven for those funds that are constantly on the hunt for high yields which is a rarity during challenging economic times.

François then amplified the buzz words we've been hearing all week which are "transparency," "alignment" and "like mindedness" of investors; this type of vocabulary seems to be a new phenomenon here at MIPM. However, they are concepts that make sense in the context of increased joint ventures which are the most secure frameworks for investors where both risk and reward are shared equally. François also highlighted the prominence and importance of sustainability and green design and mentioned the Qatari initiative as a model to be emulated. He echoed the importance of core assets in a portfolio but also suggested the premise that "core periphery assets" are a viable alternative class to hold.

Finally, the data that we compiled was presented, drum roll! It seems that the majority of attendees are more optimistic about the future. There is also little variance of sentiment data from 2011. The majority appear to be open to the idea that non-core assets are a legitimate option. Investors are split down the middle on the question regarding debt markets and whether the current state constitutes an opportunity rather than an impediment.

Today our MIPIM immersion ends, and we pass the torch to the future Graaskamp Center students. My advice to you is to enjoy and exploit every minute of your time here, it is truly a once in a lifetime experience. The day has ended; I take my last stroll on the Boulevard de la Croisette as the sun sets. As if on cue I hear the music of Edith Piaf playing in the background to bid me a proper French farewell. I’m leaving Cannes with a heavy heart because it is so easy to fall in love with the romanticism of this city. Au revoir, Cannes, au revoir. I promise to come back to see you again.

Bashar Elayyan is a first-year MBA student in the James A. Graaskamp Center for Real Estate. As an architect based in Chicago, he was involved in the design and execution of numerous complex large scale projects in the U.S., Mideast and Chinese markets. His career aspirations lie within the domains of REIT management or real estate finance and investment banking.

No comments:

Post a Comment