It’s a conference; it’s a party; it’s a business meeting – MIPIM has had, and still has many incarnations. At the peak of the property boom it was a sell-out bachanalian affair of beach parties and yachts. At the depth of the recession, La Croisette was dead quiet and in the immediate recovery many of the people I spoke to said how refreshingly business-oriented the event had become… Today? What is it?
Well, it’s only Tuesday morning so it’s still early, but gone is 2008′s ability to walk into a restaurant in the centre of town without a reservation and still get dinner. But gone also are the pessimistic conversations about the collapse in rents and values and the continual effort to hunt for the good news in a rather murky outlook.
My job has changed: I’m now looking at global real estate capital so arguably MIPIM is one of the biggest of several global gatherings where real estate capital really and truly moves. As I said, it’s only Tuesday morning but the meetings I’ve already had have touched on China, Turkey, Japan, Sweden, and of course London. The latter was the world’s most active market by turnover in 2010 and a lot of it was foreign investors committing capital to London.
Interestingly, in 2010 cross-border activity as a share of total direct real estate investment was equal to the peak of the boom in 2007. This suggests that overseas buying has picked up faster than domestic activity – which isn’t a surprise when you consider the weight of moribund secondary and tertiary property in many markets.
But this raises a concern well know to our industry: the shortage of prime stock. This raises a further question: does the definition of prime widen and/or do investors “go ugly” early to get the best returns on better quality secondary stock?
Either way, this is where it will be discussed. So is MIPIM a conference, a business meeting or a party? Well, it would be ideal if business could be made in the middle of a party… So maybe things have indeed gone back to normal.