Global cities are on a constant lookout for investment, and Cannes, France, is an annual place to find it.
Seeking investors, an estimated 26,000 real estate, city and political leaders from more than 100 countries descended on the Palais des Festivals in Cannes for MIPIM (Le marché international des professionnels de l’immobilier), an international real estate conference and networking event.
More than 100 countries and 500 cities sent delegates to the conference, with the UK, France and Germany leading the way. In a sign of increased hope for development, the delegation from the U.S. was up 10 percent from last year.
Among the key talking points at the conference were the growth in real estate investment expected this year, urban development and the move to target cities (rather than countries) in investment strategies.
Reasons for Optimism
The mood at MIPIM was one of “relative industry optimism” for the upcoming year, the organizers said after the closing sessions on March 16—and they had the numbers to back up the statement. In its annual "Global Investment Atlas 2018," property agents Cushman & Wakefield noted that a strong global economy across all markets will encourage investors to release more funds into real estate this year—after a record $1.6 trillion in 2017.
Cushman & Wakefield reported that Asian investors were particularly active in outbound efforts, increasing their investment in Europe 96 percent year-on-year. Investment from Asia Pacific to Europe reached $39.5 billion in 2017 compared to $20.9 billion heading towards the Americas. This number was achieved in spite of China's recent crackdowns on outbound investment. The Asian delegation at MIPIM represented 15 countries.
In its annual EMEA Investor Intentions Survey, released during the conference, CBRE noted that 33 percent of investors intend to deploy more capital in 2018 than last year. CBRE confirmed that 2017 was a record year for real estate investment in Europe, with volumes totaling €291 billion.
Several companies used the conference as a platform to announce new hotel developments. Lawrence Kenwright's Signature Living Group announced plans to open the 63-guestroom Waring Hotelotel in Belfast’s Cathedral Quarter, renovating the former War Memorial Building. Last year, Signature Living Group announced plans to develop the George Best Hotel in Belfast city center’s Scottish Mutual Building on Donegall Square South and the Lanyon Hotel in the Crumlin Road Courthouse. “With visitor numbers to Belfast having grown so dramatically in recent years, we welcome any development that could bring something new and unique to the city's hotel offering in the way the Waring Hotel will,” Tourism Northern Ireland CEO John McGrillen said.
Also at the conference, three hotel operators were shortlisted for a 250-guestroom hotel and serviced-apartment project planned for Liverpool’s Paddington Village. Accor, Hilton and IHG are all competing to run the new facility, and Liverpool City Council appointed Ryder Architects to build it.
Hong Kong-based Far East Consortium directors Gavin Taylor and Tom Fenton outlined the group’s ambitions to deliver their first UK hotels outside of London. The company has two Dorsett hotels in London, but wants to expand into major cities in the north, such as Liverpool. At the same time, two sites in Manchester are currently earmarked for a five-star hotel: St Michael’s; and the Renaissance strategic regeneration framework area on Deansgate. “We want a hotel in every major city in the UK, but whether we do that new-build or through acquiring existing portfolios, we’re not sure,” said Taylor. “We are looking at some portfolios but the market being the market, it’s quite hot, so the opportunity to add value there isn’t significant.”
Look at the Trees, Not the Forest
Representatives of various destinations also used the conference to attract investment for future projects. France’s minister of territorial cohesion, Jacques Mezard, said that France’s President Emmanuel Macron is pro-investment and that France now has a dynamic international image. Mezard’s optimism reflected data in CBRE’s ‘EMEA Investor Intentions Survey,’ which said that European investors now see Paris as the most sought-after destination in Europe, while non-European investors continue to favor London.
Many delegates emphasized specific cities and regions, and sought to attract attention to smaller areas rather than larger nations. Attending MIPIM to promote Poland’s Tri-City region (Gdansk, Sopot and Gdynia), former Polish President Lech Walesa told developers that they should forget the past and build with the younger generation in mind.
Paris mayor Anne Hidalgo, current chair of the C40 alliance of world cities devoted to carbon neutrality and urban regeneration, reminded MIPIM delegates that cities are now “at the vanguard of great change.” Mayor Hidalgo said that Paris has opted to support the most innovative, quality schemes, rather than the cheapest projects.
Cities from western Germany have been part of MIPIM for years, but their eastern counterparts have been scarce at the event. This year, Leipzig sent delegates for the first time, and while Mayor Burkhard Jung said that the city had suffered "significant population decline" since reunification 28 years prior, it is now the fastest-growing city in Germany.
Dubai-based developer Nakheel promoted its Palm Jumeirah project and $2.5 billion of investment opportunities in the Emirate.
Pavilions housing representatives from London, the Paris region, Istanbul, Moscow and the West Midlands also reportedly attracted large crowds—strong indicators of evergreen interest in development for these destinations.
South Mediterranean countries had an increased presence at this year's conference. Delegates promoted hotel and tourism investment opportunities in particular for Portugal’s Algarve Region, Greece’s Peloponnese Region and across Spain. Brazil was also actively promoting inward investment opportunities particularly in the tourism sector. Jose Antonio Parente, Brazil’s national secretary for tourism infrastructure told delegates that the country’s flourishing tourism industry makes it attractive for investors with major projects under development including the luxury Eco Estrela project in Baia Formosa.