The week in global real estate - 2 June 2020

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A weekly update of the biggest real estate news from around the globe.

Institutional investors / REITs

  • British Land Company reported an annual loss of $2B. The company owns office and retail space in London, and suffered a 26% fall in property values due to COVID-19. More info here.
  • British Land Company has also suspended construction on two London development sites. More info here.
  • Capital & Country has agreed to purchase a 26% stake in Shaftesbury for almost $1B. Both companies have portfolios of retail and office spaces in the West End of London. More info here.

Office

  • TikTok has leased 21,500 sqm of office space in Durst Organisation’s 48 storey One Five One near Times Square. It is the largest lease in Manhattan since the onset of the COVID-19 pandemic. More info here.
  • Google will allow employees who don’t want to return to the office to expense $1000 for home office needs, such as furniture. Google expects 10% of their employees to return to the office this week and 30% to have returned by September. More info here.
  • A court in Switzerland has ruled that employers are required to contribute to employees rent payments if they are expected to work from home. More info here.
  • Development approval has been given to part of Charter Hall’s $1.4B Wesley Place precinct. The project includes a $290M, 22,750 sqm office tower to be fully leased by the Australian Federal Police and a $50M refurbishment of a neighbouring office tower into a $300M prime commercial building. More info here.
  • Sturgeon Development Partners is planning the tallest cross-laminated timber buildings in the western United States, starting with an 8-storey office building in Portland. More info here.

Retail

  • An Ikea store near Frankfurt, Germany lent its car park to a local mosque for a socially distanced Eid prayer ceremony. 800 people joined the prayers at the site to mark the end of Ramadan. More info here.

Industrial

  • Boeing is ending a long-term lease on 6.2 acres of land near Hartsfield-Jackson Airport in Atlanta that it once used as a training facility. More info here.

Residential

  • Australian developer Mirvac is adding to its build-to-rent pipeline with a 472 unit, 33-storey apartment tower in Melbourne. The tower is part of a redevelopment of the former Melbourne Convention Centre site. The development will also feature a 45,500 sqm, 20-storey office tower. More info here.
  • Pre-leasing of a 31-storey residential tower in western Los Angeles has begun with the building set to open in 2021. The building will feature 300 rental units. More info here.
  • A new $2B fund in the UK has been set up to meet the cost of recladding residential buildings that have unsafe non-ACM cladding. More info here.

Government

  • The New South Wales government has approved a second tranche of shovel ready projects. The projects are worth $5.3B and are expected to create 15,000 jobs and 3,600 new homes. The projects include 850 ha of rezoned industrial land near Western Sydney’s Aerotropolis worth $2.6B, a retail centre, new schools and relocation of the Sydney Fish Markets. More info here.

Sustainability

  • Plus Power in Hawaii has proposed setting up a battery farm to replace a coal plant that is due to close in September 2022. The farm would use 8 acres of land near a Hawaiian Electric substation. More info here.

Colliers global research

  • Our Canadian researchers surveyed office, retail and industrial tenants about rent relief. It found that 21% of tenants had requested rent relief, with 3 months relief most commonly sought. More info here.
  • Our Australia researchers released their Retail Landlord Sentiment Survey with results showing 70% of landlords expect vacancies to increase over the next 12 months and 49% of tenants have asked for a rental holiday. More info here.
  • Our Hotels teams across Asia found that the coronavirus pandemic led to overall room occupancy rates decreasing by 42% year-on-year and revenue per available room decreasing by 40%. More info here.

Related Experts

Chris Farhi

Director | Strategic Advisory

Auckland CBD

Chris is a Director within the Strategic Advisory team. The team helps you with your big property decisions and complex transactions.

Chris' advisory work focuses on:

  • Decision making processes (eg property strategy, business cases, feasibilities, etc)
  • Tenant representation for large lease transactions (office,  industrial and specialist-use)
  • Multi-site networks (eg consolidation strategies, optimisation, etc)

Chris’ background in brief:

  • Property strategy advisor for some of New Zealand’s most successful private sector, public sector and non-for-profit organisations.
  • Tenant representative (tenant-paid lease negotiator) for organisations ranging from small-to-medium enterprises through to major listed companies and government agencies.
  • Specialist skills in commercial leasing, financial analysis and market research.
  • Part-time lecturer at the University of Auckland Business School and commercial leasing trainer for the Royal Institution of Chartered Surveyors.

Chris’ qualifications include Honours degrees in both Civil Engineering and Property from the University of Auckland, and a Master of Philosophy from the University of Cambridge, UK. He is a Chartered Member of the Royal Institution of Chartered Surveyors.

Outside of work, Chris is a combat engineer in the NZ Army Reserve and a keen baker.

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