Reporting from MIPIM: Cautious optimism

The Graaskamp Center was very glad for the opportunity to contribute to MIPIM's official blog. Prof. Erwan Quintin, along with Wisconsin School of Business Dean François Ortalo-Magné, led the delegation of Wisconsin Real Estate MBA students who attended the international event. He summarized his perspective and his outlook on the week's activities in this post.

As seems to be the case every year, strong themes clearly emerged at MIPIM. First and foremost, participants are looking for signs that the crisis days are over and that investors are once again willing to accept some exposure to real estate beyond the safest, core markets. Investors also want to know which opportunistic markets will benefit the most from the recovery, if and when it comes. And they want to know what lessons, if any, the industry has learned from the crisis experience.

The broad sentiment at MIPIM this year is probably best described as “cautious optimism.” As bearish as they sound about their own markets, European investors appear remarkably bullish about U.S. prospects.

He also offered this:

A near consensus also emerged among institutional investors that the basic investment model in real estate must change in the wake of the recent financial crisis. Capital losses of historic magnitude have prompted large investors to question past practices, demand significant changes in how they interact with partners and fund managers. Investors are demanding more control over how their capital gets deployed, more transparency, and are working harder to align incentives throughout the intermediation chain. A new and improved real estate fund model should result from this phenomenon.

To continue reading Prof. Quintin's outlook, visit the MIPIMWorld blog.

Wisconsin also contributed these posts:

• A Political Perspective on the Euro Crisis: Students and faculty from the Wisconsin School of Business are attending MIPIM 2012 this week. Bashar Elayyan reports on his experiences and takeaways from Day 3.
• MIPIM: The Students’ View: The Wisconsin School of Business gears up to cover MIPIM 2012.

For more of Wisconsin's Reporting from MIPIM here on the Wisconsin Real Estate Viewpoint, click on the "MIPIM" tag.

Reporting from MIPIM: Final wrap-up keynote presentation

Prof. François Ortalo-Magné, Albert O. Nicholas Dean of the Wisconsin School of Business, presented the findings of a survey of participants at MIPIM 2012. He and Mark Roberts, Global Head of Research at RREEF, discussed the major themes and takeaways from the week in Cannes.

For more visit, the MIPIM World blog.

Excitement is building up to the kickoff of MIPIM 2012

Check out our post at the official MIPIM blog where we will be contributing next week during the show.

Excitement is building up to the kickoff of MIPIM 2012. Public sector leaders and private sector investors will converge on Cannes, France, next week to take the industry’s temperature, to get a glimpse into the near future, to ask questions (and hopefully find some answers), and to make valuable connections. Students in the real estate MBA program at the Wisconsin School of Business will be there as well.

This is the seventh year that a delegation of Wisconsin Real Estate MBA students will be attending the show. Students and faculty are leaving today and tomorrow for Cannes, still doing research into the topics that will be discussed and the questions that they want to ask.

For a look back at our previous MIPIM coverage, click on the posts labelled MIPIM. And be sure to visit our blog next week for more reporting on the panel sessions, plus Dean François Ortalo-Magné's remarks on Friday. His keynote is the perfect way to wrap-up the meeting, with the major takeaways and trends. Don't miss it!

UW-Madison delegation finds optimism and opportunities in Asia

“Cautious optimism” is the economic outlook from Asia, according to a survey conducted at MIPIM Asia last week by the Wisconsin School of Business in cooperation with HKUST Business School.

“The strong sense of optimism that we’ve seen in the last two years in Asia has been justified,” says François Ortalo-Magné, Albert O. Nicholas Dean of the Wisconsin School of Business, who presented the survey findings at the annual real estate and investment conference in Hong Kong, which is attended by 1,800 senior real estate executives, retailers, government officials and city administrators from 41 countries. This is the third annual investor survey led by Ortalo-Magné at this conference.

An obvious reflection of this optimism is the fact that more than half of the participants surveyed at the conference reported improved or at least the same level of business activity in the current quarter compared to the same quarter last year.

“China is the unavoidable market because of the scale and the performance of the economy,” says Ortalo-Magné.

Ortalo-Magné’s visit is part of the University of Wisconsin–Madison’s broader efforts at deepening relationships with government, business and education leaders in China. He accompanied Gilles Bousquet, dean of the Division of International Studies and vice provost for globalization, and Laurie Dennis, associate director of the Wisconsin China Initiative (WCI), to meetings in Hong Kong and Shanghai.

“The sense that I get each time I visit Asia is that the center of gravity in the world is moving here,” says Ortalo-Magné. Last November, he accompanied former UW–Madison Chancellor Biddy Martin and her delegation on a trip to Asia intended to strengthen academic relationships in the region and promote collaborative economic development.

Bousquet adds, “We are seeking to create a unique UW presence that is consistent with the Wisconsin Idea and highlights the strengths of our world-class university, matched to the needs in China.”

UW–Madison already has a variety of connections with many of the top Chinese universities, including the Hong Kong University of Science and Technology (HKUST).

HKUST Business School is among three of the world’s leading business schools (along with HEC Paris and INCAE-Costa Rica) in a ground-breaking partnership with the Wisconsin School of Business to offer the Global Real Estate Master (GREM) degree program. Joe Walsh, director of the program, joined Ortalo-Magné for part of his Asia trip.

“There is strong demand for high-level education in real estate in Asia,” says Walsh.

Ortalo-Magné and Walsh are working to expand the GREM program, which combines graduate-level instruction in economics, finance, and business administration at one of the partner schools with training in the principles of international real estate during a capstone semester at Wisconsin. They met with university officials, local real estate industry leaders and prospective students.

While in Hong Kong, Ortalo-Magné also addressed the American Chamber of Commerce and met officials with the Royal Institution of Chartered Surveyors (RICS), a prominent worldwide organization for professionals in property, land, construction and related environmental issues. Wisconsin’s BBA and MBA real estate degree programs have been accredited by RICS.

“When I hear this time referred to as the ‘Decade of the Pacific,’ it reinforces to me how much smaller our world is getting and in turn how important it is to have a global awareness in all we do,” says Ortalo-Magné.

-- by Kris Hammargren

What opportunities are being sought out by Asian, European, and American investors? MIPIM Asia 2011

That was the question this morning for the panel at the wrap-up keynote at MIPIM Asia 2011. Discussion was led by Dean François Ortalo-Magné, with Yue Tang, attorney with Jun He Law Offices (China), and Dr. Megan Walters, head of research for Asia Pacific capital markets with Jones Lang LaSalle (Singapore).

Ortalo-Magné presented the results of the annual survey of conference participants, conducted by the Wisconsin School of Business in cooperation with HKUST Business School. The survey saw a justification of the optimistic outlook in Asia as reported at last year's conference, with more than half of participants reporting improved or at least the same level of business activity in the current quarter compared to the same quarter last year. "Cautious optimism" was a keyword for the future with two-thirds say they are more or as optimistic about the outlook than they were a year ago.

From Reed Midem:

The expert panel also noted increasing investment opportunities for international companies targeting mainland China as legislation seeks to open up the market to a diverse range of development companies.

Watch Part 1 of the wrap-up here. Visit mipimworld on youtube for Part 2-4.



Edited to add:

Open publication - Free publishing - More china

MIPIM Asia: Macroeconomic outlook and implications

Wisconsin School of Business Dean François Ortalo-Magné is in Hong Kong this week for the annual real estate property and investment conference MIPIM Asia. He facilitated the opening keynote session today with Robert Ciemniak, global head of Thomson Reuters Real Estate Markets, and Yiping Huang, professor of economics at the China Center for Economic Research at Peking University. On Thursday, Dean Ortalo-Magné will deliver the wrap-up presentation "Where do Asian, European and American investors see opportunities in Asia today?"

Visit live.mipimworld.com for the full conference schedule and more highlights





His visit to Asia is also part of the University of Wisconsin–Madison's efforts to develop stronger ties with China. The dean will join Gilles Bousquet, dean of the Division of International Studies and vice provost for globalization, and Laurie Dennis, associate director of the Wisconsin China Initiative, for meetings in Hong Kong and Shanghai.

Also participating in MIPIM Asia is real estate faculty member Joe Walsh who also leads Wisconsin's Global Real Estate Master (GREM) program, an intensive graduate-level program which is partnered with three of the world's top business schools: HEC Paris, Hong Kong UST, and INCAE. While in Hong Kong, he is meeting local real estate industry leaders and prospective students. The Global Real Estate Master (GREM), which graduated its inaugural class in 2011, is a unique two-phase program that combines high-level instruction in economics, finance, and real estate finance at one of the partner schools with training in the principles of international real estate during a capstone semester at Wisconsin. The program is now accepting applications for the 2013 semester.

A few observations on the evolution of our Program and School

by Stephen Malpezzi, Professor and Lorin and Marjorie Tiefenthaler Distinguished Chair in Real Estate

We've had two significant changes in the staffing and organization of the Wisconsin School of Business and our real estate program in the past few weeks. On July 1, Associate Professor Morris Davis took the reins as Academic Director of the Graaskamp Center, implementing a succession plan that we've had in place for some time. A very short description of the Graaskamp Center's main functions are to provide a home for the MBA program in real estate, and to implement the Wisconsin Idea by connecting our program more deeply to the worlds of business practice and policy outside the University. Morris' movement into this position is a natural evolution after he so successfully took on leadership of the MBA program last year; now he adds the outreach functions to his portfolio. With the support of the faculty, Center staff, Executive Director Michael Brennan, and the rest of the UW real estate community, Professor Davis is well placed to move the Center to the next stage of its evolution. Morris' deep and probing approach to the study of real estate, and his enthusiasm and out-of-the-box thinking, augur well for our future.

Our second change is even more significant, as on September 1 our esteemed Department Chair François Ortalo-Magné becomes the Albert O. Nicholas Dean of the Wisconsin School of Business, succeeding our program's good friend Mike Knetter. During his tenure as Department Chair, François has worked tirelessly and effectively to move our program and the School ahead, in ways large and small. Most of you know at least the outlines of the Global Real Estate Masters (GREM), our innovative partnership with HEC, INCAE and Hong Kong University of Science and Technology to offer dual degrees to students from those top schools, in the process exposing our MBAs and undergraduates to repeated cohorts of future fellow global leaders in real estate. Perhaps fewer people outside Madison know about many of the other innovations François has pioneered in the "blocking and tackling" of the program, e.g. our marketing, financial stewardship, and curriculum. François has shown repeatedly that he is one of those rare leaders who excel at both the development of innovative strategies and their careful execution.
Right now, the highest priority for our real estate program has to be moving ahead in concert with the Wisconsin School of Business, and I am completely confident François is the right person to build on the contributions of Mike Knetter, (interim dean) Joan Schmit and other leaders of our School.

Naturally, we will have some other changes to announce in the weeks and months ahead as we adjust the roles of faculty and staff in response to these exciting developments. For now, let me simply congratulate Morris and François on their new roles, and convey my own enthusiasm about the possibilities these changes open up for the Graaskamp Center, the entire Wisconsin Real Estate Program, and the Wisconsin School of Business. I have had, and continue to enjoy, the privilege of working with Morris and François and our other faculty and staff, and so many of you who embody those attributes and values that make the Wisconsin Tradition what it is today: intellectual rigor, an ethical approach to our business, great enthusiasm for our students, "continual and fearless sifting and winnowing." I know you will join me in supporting Morris and François in their new roles. On Wisconsin!

Congratulations Dean Ortalo-Magné

Please join us in welcoming Wisconsin Real Estate's own François Ortalo-Magné as the new dean of the Wisconsin School of Business. The announcement came on Friday July 8. Ortalo-Magné, Robert E. Wangard Professor and chair of the Real Estate and Urban Land Economics Department at the University of Wisconsin-Madison, will begin his new role as the Albert O. Nicholas Dean of the Wisconsin School of Business on September 1. Visit the school's website for the full announcement and more information. Here are a few quotes from the official announcement:

“I am convinced the Wisconsin School of Business is capable of greatness. And we do not have a choice,” says Ortalo-Magné. “We must respond to the globalization of higher education and the revolution in information technologies. I am excited about the opportunity to lead our school, building on our values and the strength of our specializations, renewing and reinventing how we partner with the world and colleagues around campus.”

“François has the intellectual energy and ambition to help the School of Business reach new levels,” says UW-Madison Chancellor Biddy Martin. “I am impressed by his work on the international front and am confident that he will consolidate and enhance the gains made under Mike Knetter’s leadership."

The Financial Times carried news of the announcement on Monday, "Wisconsin-Madison appoints Ortalo-Magné as next dean."

And the Milwaukee Journal Sentinel ran a profile, "UW-Madison names new business school dean," including comments from Bill Malkasian, president of the Wisconsin Realtors Association.

"He sees no boundaries. He certainly understands the world. ...He brings a global perspective."

Congratulations to François and on Wisconsin!

UPDATED 7.15.11

BusinessWeek reported today "Wisconsin Gets a New B-School Dean." Read the article here.

UW's Daily Cardinal also writes ("Ortalo-Magné named B-School dean") that Ortalo-Magné:

intends to strengthen leadership within the business school, continue to learn about how the school functions, and build relationships with other business school deans.

Ortalo-Magné said it is imperative for the business school to respond to worldwide changes in information technologies and higher education, and he looks forward to helping it do so.

Photo: Valerie Caviness

School of Business dean finalists to visit campus

From the office of University Communications:

The three finalists for the position of Albert O. Nicholas Dean of the Wisconsin School of Business at the University of Wisconsin-Madison will be on campus in coming days.

Each finalist will spend two days on campus visiting and meeting with people at UW-Madison as the final part of the search-and-screen process.

During their visits, the three finalists will have contact with the broader campus community, from meetings with Chancellor Biddy Martin and Provost Paul DeLuca to gatherings with academic deans, shared governance groups, and students, faculty, staff, alumni and other members of the Wisconsin School of Business community.

The candidates will also hold open sessions in Grainger Hall, 975 University Ave., to answer questions from those interested in the future of the Wisconsin School of Business.

• Monday, June 6: Michael Trick, professor of operations research and associate dean for research in the Tepper School of Business at Carnegie Mellon University, 10:30 a.m.
• Wednesday, June 8: Anil K. Makhija, Dean's Distinguished Professor of Finance in the Fisher College of Business at The Ohio State University, 2:30 p.m.
• Wednesday, June 15: François Ortalo-Magné, Robert E. Wangard Professor of Real Estate at the Wisconsin School of Business, 10:30 a.m.

Live webcasts of the candidate presentations will be available at http://www.bus.wisc.edu.

This morning was the first of the presentations, with Michael Trick. As part of his presentation, he mentioned two books on the future of graduate level business education. I thought this was a good fit for our Reading for Life series (originated by Prof. Stephen Malpezzi, see previous entries in the series here).

The first is Rethinking the MBA by three Harvard researchers Srikant Datar, David A. Garvin, and Patrick G. Cullen; and the other is From Higher Aims to Hired Hands by Harvard professor Rakesh Khurana.

There certainly is no shortage of books on the subject of higher education. Have you read either of these books? What do you think of them? Please share your thoughts in the comments.

Sixth annual MIPIM trip brings optimism and global connections to students

At the 2011 MIPIM conference, Professor Francois Ortalo-Magné spoke about the sun rising after the global financial crisis that rocked so many countries. This year, it was high noon and time to begin feeling optimistic about the markets again.

In March, eleven first-year real estate MBA students from the Graaskamp Center accompanied Ortalo-Magné to Cannes, France to attend MIPIM, the largest real estate conference in Europe with over 18,000 attendees. This was the sixth consecutive year that the Graaskamp Center sent its students to this global gathering of real estate professionals and public sector leaders.

The students quickly immersed themselves in the many learning and networking opportunities at MIPIM. They attended each of the thirty-nine panel discussions and presentations that were held throughout the week to both contribute to the Wisconsin Viewpoint and MIPIM World blogs covering the event and administer the annual survey to MIPIM participants in order to gauge perception of today's markets.

"More than anything else, I was struck by how the event provided a personal touchpoint to events that I otherwise only read about in the media," said first-year MBA student Ben Schmidt. "For example, though it doesn't get the most attention in the US, it's no secret that Russia and Turkey have both experienced strong economies in the past few years. It was no coincidence then that those countries' exhibitions at MIPIM were among the grandest."

The strength of the investment markets in Russia and Turkey were topics of the first day of MIPIM, as well as China and Poland. The day led off, however, with London Mayor Boris Johnson's keynote address on his "City of Regeneration," including details about the upcoming 2012 Olympics.

Students enjoyed some unique opportunities, including the chance to attend the Mayor's Summit, a closed-door event where mayors and city leaders share their experiences, ideas and best practices related to sustainable urban strategy, and networking with industry leaders. Ortalo-Magné also arranged for small-group meetings with professionals from Real Capital Analytics, SEB Asset Management, Allianz Real Estate, the Bjarke Ingels Group, and others. These meetings gave the students the opportunity to learn about the firms' experience and strategy and to get the kind of insights you won't read in the press or hear on a conference panel.

"I learned a lot from talking with these high-level global real estate professionals," said Julia Xia, a first-year MBA student. "We also attended private events hosted by various real estate firms which helped us to expand our professional connections. Through these networking opportunities, I was fortunate to line up some interviews for potential internships."

Ortalo-Magné once again delivered the final wrap-up presentation (video + slides) with senior analyst Philippe Tannenbaum with IEIF (France). He noted that attendees left MIPIM 2011 feeling more optimistic than when they arrived. Breaking the data down along public/private sector lines, about a third of the private sector and over half of the public sector representatives said their experience at MIPIM had changed their outlook for the better. While Tannenbaum observed the key words for 2011 were "risk aversion," the survey results suggested MIPIM participants were ready to explore beyond the core or safe markets.

"I was struck by the optimism of the conference," said Schmidt. "The survey we conducted for Professor Ortalo-Magné certainly bore this out: investors and professionals have seen their business solidify in the past year, and they are excited to look for new opportunities in the coming year."

For detailed coverage of all the MIPIM sessions, read more on the Wisconsin Real Estate Viewpoint. For more news and events from the Graaskamp Center, sign up for our monthly newsletter (via Constant Contact). Read the April 2011 issue here.

Final wrap-up from MIPIM 2011

Professor François Ortalo-Magné, chair of the Department of Real Estate and Urban Land Economics at the Wisconsin School of Business, delivered a wrap-up keynote presentation at MIPIM last week with Philippe Tannenbaum, senior analyst at IEIF (France).

For more coverage from MIPIM 2011, keep reading the Viewpoint and visit MIPIM World.

MIPIM 2011 – Wrap-up keynote address

MIPIM World, the official website featuring content from this year's MIPIM conference, posted video of today's keynote presentation by Prof. François Ortalo-Magné, Robert E. Wangard Chair in Real Estate at the Wisconsin School of Business, and Philippe Tannenbaum, Senior Advisor with IEIF France. Click to visit the MIPIM website and watch the video and view the slides from the presentation.

And please check out the rest of our coverage of MIPIM 2011 here on the Viewpoint and at MIPIM World.

U.S. real estate rebound? MIPIM 2011

Reporting from MIPIM 2011 Day 2:

In a recent survey of foreign property investors, the U.S. ranked some 50 percentage points higher than its closest competition in providing the greatest opportunities for capital appreciation and 20 points higher offering the most stable and secure property investments in the world.

The robust property markets in New York and Washington are considered signs of recovery of the real estate market. However, data from CRE showed that the vacancy rates for office, retail and multi-family are still at historic highs. Multi-family rents have started to improve while rents for most other commercial properties still soft. There was a nice spike in the real estate transaction at the end of year 2010, but the market is still weak in terms of price and volume. Property prices in New York and Washington were driven up by risk-averse capital investment in trophy properties, and the prices for most other properties are unchanged. Distressed assets continued to be drag for the market. The retail sector offers some opportunities with more bankruptcies and consolidations still to go. Unemployment and political factors represent macro risks for the real estate market.

Secondary markets in the U.S. are considered the next targets with huge potential and opportunities.


This is a topic of particular relevance to the Graaskamp Center and Prof. François Ortalo-Magné who leads an annual survey of the members of AFIRE, the Association of Foreign Investors in Real Estate. The survey, results of which were released in January, revealed that the U.S. real estate market offers a stronger investment opportunity for foreign real estate investors’ money than it has in the last 10 years. Interestingly, there is typically a fairly even distribution of votes among the top U.S. cities for foreign investment. However, in this year’s survey, New York and Washington scored almost four times higher than third place Boston. Click here to read the full story and the detailed survey results.

Breaking the cycle in France

Professor François Ortalo-Magné is member of the council of economic advisors to the French ministry in charge of land use and housing policy, among its many mandates (Economic Council for Sustainable Development, Ministry of the Ecology, Sustainable Development, Transports and Housing). At its latest meeting, on Monday February 14th, the council discussed the current taxation of land in France and opportunities to improve the system.

To move the debate forward, Ortalo-Magné presented key ideas from his latest research paper on the political economy of urban growth (pdf download). He and co-author Professor Andrea Prat (London School of Economics) highlight a major flaw in the design of housing policy in many countries including the U.S. and France: “Both countries promote housing affordability for all and homeownership for most. Andrea and I find that these two objectives are not compatible when local voters get to decide on local urban growth, as happens in the U.S. and France,” says Ortalo-Magné.

When homeownership is subsidized, voters are encouraged to own more housing. Because they own more housing, they lose more if local housing supply increases given the same level of demand. Therefore they have an incentive to vote against urban growth. In their research, Ortalo-Magné and Prat demonstrate how vicious cycles may emerge whereby voters invest in housing because they expect the voting process to protect their investment, and they vote to protect their investment because they invested a lot. As a result, a city may remain smaller than what voters would have preferred had they been asked to vote together, before they bought any housing.

To break this cycle, Ortalo-Magné proposes that homeownership subsidies in France be greater in cities that commit to increase local supply. “Short of blocking the latest round of first-time buyer subsidies, introducing a bit of conditionality in the subsidies is a step in the right direction to break the type of vicious cycle Andrea Prat and I identify in our research. Maybe in the future, local communities won’t be eligible for any subsidies unless they also release some supply. That would help!”

CNBC: Foreign Investors Betting Big on US Real Estate

James A. Fetgatter, chief executive of AFIRE, the Association of Foreign Investors in Real Estate, appeared on CNBC to discuss the results of the annual survey of its members by the James A. Graaskamp Center for Real Estate. The survey was conducted in the fourth quarter of 2010 by Professor François Ortalo-Magné with assistance from first-year real estate MBA students at the Wisconsin School of Business.

The survey was also mentioned on the The Today Show last week.

U.S. Cities Lead Way for Global Foreign Real Estate Investment

Results of the 19th annual survey of members of the Association of Foreign Investors in Real Estate (AFIRE) conducted by the James A. Graaskamp Center for Real Estate were published this week.

The survey has revealed that the U.S. real estate market offers a stronger investment opportunity for foreign real estate investors’ money than it has in the last 10 years. Survey respondents hold more than $627 billion of real estate globally, including $265 billion in the U.S. The survey was conducted in the fourth quarter of 2010 by the Graaskamp Center led by Professor François Ortalo-Magné with assistance from first-year real estate MBA students at the Wisconsin School of Business.

"Global investors express strong confidence in their favorite US markets: New York City and Washington, D.C.," said Ortalo-Magné. "The trend we have observed of a broadening interest in emerging market strategies beyond China is in line with what our Global Real Estate Master students heard at MIPIM Asia two months ago."

Among the survey results (click here to visit AFIRE):
• More than 60% of respondents, a margin of 54 percentage points over second-ranked China, indicate that the U.S. offers the best potential for capital appreciation. This is the highest positive response to this question since it was first asked in 2000; this number is a dramatic reversal from 2006 when it reached a lowest level of 23%.

• Investors overwhelmingly chose New York and Washington, D.C. as the two top global cities for their real estate investment dollars.

• 72% of respondents say they plan to invest more capital in the U.S. in 2011 than they did in 2010.

• When ranked among countries targeted for real estate investment in 2011, the U.S. score was quadruple that of the second-ranked U.K.

“As the fear of a double-dip recession has faded, investors are becoming more enthusiastic about the prospects for the U.S. economy and are taking aim at real estate investment opportunities in the U.S.,” said James A. Fetgatter, chief executive of AFIRE. “However, their strategy is more akin to a rifle than a shotgun. Except for multi-family housing, they are not scattering their interest throughout the U.S., but rather narrowly targeting it to New York City and Washington, D.C., to an even greater extent than in previous years.”

Other U.S. Real Estate Trends
2011 Perspective: An Improving Market
When asked about their perception of the U.S. real estate market as a conduit for their investment dollars, responses underscore a continuous improvement over the last year:

• 40% said they were more optimistic than they were at the start of 2010
• 55% said they felt about the same
• 4 % said they were more pessimistic.

Top Five U.S. Cities for Foreign Real Estate Investment
Historically, there has been a fairly even distribution of votes among the top U.S. cities. In this year’s survey, however, New York and Washington scored almost four times higher than third place Boston.
1. New York (#2 in 2010)
2. Washington, D.C. (#1 in 2010)
3. Boston (#4 in 2010)
4. San Francisco (#3 in 2010)
5. Los Angeles (#5 in 2020)

Preferred U.S. Property Types for Investment in 2011
Although, as it has for the last several years, multi-family properties remain investors’ first choice, hotels have come out of three year, fourth- and fifth-place doldrums.
1. Multi-Family (#1 in 2010)
2. Retail (#4 in 2010)
3. Hotel (#5 in 2010)
4. Office (#2 in 2010)
5. Industrial (#3 in 2010)

Global Real Estate Trends
“Compared to 2010, there is definitely a broadening of interest among emerging markets,” said Ian Hawksworth, AFIRE’s newly elected chairman. “For those who were risk averse last year, China seemed a safe harbor for emerging market investments. But, for now at least, investors have become more comfortable diversifying into other emerging markets. Likewise, in the last downturn, London was the first market to recover, and whilst investment in the UK Capital is still very active, it is not surprising that London has dropped to third place as investors expand their search to higher yielding markets such as U.S. gateway cities that offer attractive risk adjusted returns.”

Emerging Markets for Investment in 2011
Since 2009, when it was first ranked as an emerging market of interest, Brazil has held either the first (2009 and 2011) or second (2010) ranking. The trio of Brazil, China, and India dominate this ranking. Russia, which has been among the top five emerging markets in the last two years drops into tenth place.
1. Brazil (#2, tied with India, in 2010)
2. China (#1 in 2010)
3. India (#2, tied with Brazil in 2010)
4. Vietnam (unranked in 2010)
5. Mexico (#4 in 2010)

Top Global Cities Rank for 2011
London, which held sway as one of investors’ top two cities every year since 2001, has been deposed into third place. Shanghai returns to fifth place after dropping into ninth place in 2009. Tokyo moves out of the top five into fourteenth position.
1. New York (#3 in 2010)
2. Washington, DC (#2 in 2010)
3. London (#1 in 2010)
4. Paris (#4 in 2010)
5. Shanghai (#9 in 2010)

Top Countries Targeted for Real Estate Investment in 2011
Although historically, investment targeted to the U.S. earns a substantial margin over other countries, in this year’s survey it ranked nearly five times higher than second place U.K. In 2010, it ranked less than three times higher.
1. US (#1 in 2010)
2. UK (#2 in 2010)
3. Germany (# 3 tied with France in 2010)
4. China (#5 in 2010)
5. France (#3 tied with Germany in 2010)

Countries Providing the Best Opportunity for Capital Appreciation in 2011
Consistent with other answers to this year’s survey, the U.S. claimed an historically disproportionate number of votes, more than six times than that for second place China.
1. U.S. (#1 in 2010)
2. China (#3 in 2010)
3. U.K. (#2 in 2010)
4. Brazil (#4 in 2010)
5. Australia (unranked in 2010)

Countries Providing the Most Stable and Secure Real Estate Investments in 2011
The U.S. continues to provide the most stable and secure real estate investment, but by a shrinking margin over other countries. None of the leading emerging markets are among the top 10.
1. U.S. (#1 in 2010)
2. Germany (#2 in 2010)
3. Canada (#3 in 2010)
4. UK (#6 tied with Australia in 2010)
5. Australia (#6 tied with the UK in 2010)

AFIRE members have a common interest in preserving and promoting investment in cross-border real estate. Founded in 1988, AFIRE currently has nearly 200 members representing 21 countries. www.afire.org

The world needs passionate, talented and socially responsible people to develop, finance and improve the urban environment. The Wisconsin Real Estate Program challenges these people to reach their potential, building on a 100-year long tradition in research and education. Click here to learn more.

Real Estate and Badgers Football

Excitement on campus is high as the UW Badgers football team prepares for its 2011 appearance at the Rose Bowl. As the semester winds down, alumni, students and fans are busily making plans to watch the game. Tickets may be hard to come by, but that hasn't dampened the enthusiasm. It's the seventh trip to Pasadena in school history, and the team's first time since 2000.

All the talk about Badgers football reminded us of Wisconsin Real Estate's football connection through real estate graduate and current Cleveland Browns tackle Joe Thomas. Thomas graduated in 2007 with a B.S. in Real Estate and Urban Land Economics and was subsequently drafted by the Browns.

We looked back in our news archives to June 2007 for an interview we did with Thomas talking about his interest in real estate, what he got out of the program, and his strong work ethic. Here is an excerpt:

What did you like about real estate?

“I think real estate is more hands-on than a lot of other majors. You’re doing a lot more stuff in the field, not so much sitting in a cubicle or at a desk. And just about everybody is affected by it. Anybody who plans on owning a house, it’s such a big advantage to take a real estate class, and to be able to know about a mortgage, what your best options are when buying a house or looking for property.”

What real estate classes did you take, and were they challenging?

“I took Real Estate Process, with Sharon McCabe; Valuation and Appraisal, also with Sharon; Urban & Land Economics, with Morris Davis; Finance, with François Ortalo-Magné; and Residential Development, with Tom Landgraf.

“To me, the whole real estate program just makes sense. A lot of people who are really good at math say that it makes sense to them, and that’s kind of how real estate is to me. It's like a puzzle; everything fits together. It’s not just memorizing it, you just understand it.”

What else did you like about the real estate program?

“The networking and connections that you make. That’s part of the reason why this is the number 1 program in the country: you are involved with different groups, you do projects with each other, you form great friendships. The people you meet here are the people who are going to help you get a job down the line.”

To read the rest of the interview with Thomas, click through to our News Archive.

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MAPIC 2010: Retail developments in an uncertain world

Updated to post final version of presentation

To watch video of the presentation, click to visit the MAPIC website.

MIPIM Asia 2010: Uncertainty and Self Confidence in Asia Pacific

To watch highlight video of the presentation, click to visit MIPIM Asia website.

Honoring Fred Petri, tireless supporter of real estate education at Wisconsin

On Wednesday September 15, 2010, members of the Graaskamp Center Board of Advisors honored Fred Petri, President of Housing Capital Co., lifetime member of the board and long-time supporter of the real estate program at the Wisconsin School of Business. Professor François Ortalo-Magné, chairman of the department of real estate and urban land economics at the Wisconsin School of Business delivered the following remarks.

“I would like my words to convey to Fred Petri my utmost gratitude for his quiet and humble contribution to the real estate program here at the Wisconsin School of Business. In deference to his wishes, we are honoring him tonight by simply being here, around him; no roast, no toast, no lifetime achievement award. Any such award would be unfair because we cannot yet measure the full impact of his contribution.

We would not be here tonight if he had not worked tirelessly and successfully, by himself and with his friends, to convince the UW and the School of Business to stay involved in real estate education once Jim Graaskamp passed away. Fred set the foundation for the post-Graaskamp era, putting us on a path whereby today we have a legitimate claim at global leadership in real estate education.

Once the program was secure, he innovated with his friend Jim Curtis to create and fund (with additional help from E.J. Plesko) the Applied Real Estate Investment Trust (AREIT) training program, one of the distinguishing features of our real estate MBA program. This program is so valuable that last year we extended its reach to include undergraduate students – a gift that keeps on giving.

Fred Petri has done much more for us, some of it only the chairman of the department will ever get to measure and appreciate.

Personally, I want to thank you, Fred, for two things. First, a month after I started at Wisconsin, we bumped into each other at the Madison airport. You sat me down and gave me the lay of the land. I left twenty minutes later thinking: these guys are really passionate about their real estate program, I’d better do my best. Second, today I am here as chair of possibly the best real estate program in the U.S., arguably the best in the world. Through the Global Real Estate Master (GREM) partnership, we are establishing ourselves as the real estate department to the number one business schools in Asia, Latin America and Europe. Without your inspiration to my career here, without your influence on the program, I would not have the privilege today to share the evening with you and so many of your friends dedicated to training the most competent, professional and passionate real estate leaders around the world.

So on behalf of all of us, on behalf of our Dean Mike Knetter who could not be here tonight, and on behalf of the university, thank you.”

Photo by Martha Busse of Fred Petri (center) with friends and family at the fall meeting of the Graaskamp Center Board of Advisors.