October 2008

Strategies in a volatile real estate market.

Australia responds ...
reduces withholding tax

South Africa ...
introduces REIT regime

Argentina ...
credit crunch limited impact


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    A word from the Chairman

    A recurrent theme runs throughout this third edition of Beyond Borders as our authors write about strategies for the continuing creation of wealth within an otherwise volatile real estate market and provide updates from US, Asian, European and South African property markets.

    In Argentina the real estate business has been less affected by world uncertainty, as the comparative value of local property is significantly lower. Even in areas of prime real estate property purchases are mainly carried out in cash transactions.
    For Australia to be a more attractive real estate investment option - lower the withholding tax rates for foreign investors.
    Over the rooftops of Brussels, the capital of Europe, the property market is stagnant - very little is moving. Nevertheless, Brussels has the good fortune to be cushioned by the powerful force of institutions of the European Union, NATO, etc, and the accompanying legions of lawyers, lobbyists, journalists et al, who have an ever increasing demand for space as the EU continues to grow.
    Combine the ongoing trouble in the credit markets with a period of rising inflation as a backdrop and the UK, and many European economies would appear to be entering a period of slow economic growth.
    The monthly calculated ‘Ifo Business Climate Index’, known in Germany as a prominent instrument for business-cycle analysis, shows for August 2008 the third decline in succession.
    A recent article published in German investment journal “Beteiligugngsreport” written by Hanno Weiß, head of real estate at Lloyd Fonds AG in Hamburg states that after a period of low transactions, German hotels are experiencing an influx of business. Increased revenue from hotels is predicted to boost investment in German hotel real estate, a market that is currently dominated by foreign investment funds.
    Compared to the rest of Europe, the German property market has become a more attractive investment market. For the first time in four years Hamburg, Munich, Frankfurt and Berlin are now included in the list of top ten European locations.
    Two types of property vehicles are currently in existence in South Africa; Collective Investment Schemes in Property and Property Loan Stock Companies.

    Singapore - The development of Marina Bay

    Singapore is a city state of only 700 sq. km, with hardly any natural resources, except for its people. Attracting talent and investments is crucial for Singapore’s growth and survival.
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