Real Estate Issues

Editor's Statement

Insider's Perspective

Shanghai Development Takes Off, Transforming the Residential and Commercial Landscape

Visitors have difficulty finding the words to describe the scale of development in Shanghai. Its enormous size and rapid change-and its leaders' ability to make decisions and execute-is amazing. This growth, of course, is not painless. Urban sprawl, corruption and an extremely complicated government system are among the challenges that officials and business leaders face on a daily basis.

The State of the Uk Property Market: Key Drivers

The first of a series of four articles on the author's personal perspectives on the state of the UK property market is presented. As several economic components evolve, so does the face of the UK property market. Interest rates are threatening to increase, but a growth in speculative development -- up from practically nothing five years ago to L5 billion in 2005 -- could offset any decline in productivity. And a lack of large office space could force some sizable companies to become pseudo-de...

Navigating the Complex World of Business Property Leasing-the Tenant's Side

No consultant, real estate broker or lawyer likes to be accused of over-lawyering a lease. But clients often fail to recognize that a lease is a very complex document. State rules vary widely in identifying parties' obligations and rights when nonresidential property leases fail to address key issues. However, in one respect, all U.S. courts agree: To a substantial extent, parties can change the rules by signing a written lease that contains different rules than the law would otherwise impose.

Capital Still Flows Into Commercial Sector As Investors Become More Discriminating

Commercial real estate continues to be an attractive investment relative to stocks and bonds for many reasons. The level of capital that continues to flow into the market indicates that commercial real estate is clearly coming of age. Commercial real estate investments will push the envelope by taking on riskier investment strategies and, as a result, pricing parameters for commercial real estate will continue at heightened levels.

Is U.S. Real Estate Priced Right Today?

At today's record prices, and with 20 percent total returns over the last year, many investors have found themselves asking: "Are real estate prices too high?" Though interest rates have risen about 75 basis points since the first of the year, capitalization rates have barely moved. Higher borrowing rates have taken many debt-based investors out of the bidding, but evidence indicates that a large numbers of bidders remain, keeping prices high and cap rates low.

Resource Review

Managing Government Property Assets: International Experiences

Managing Government Property Assets: International Experiences, edited by Olga Kaganova and James McKellar, is reviewed.

The Appraisal of Land

The Appraisal of Land, by Max Derbes Jr, is reviewed.

Feature

Culture, Identity and Democracy in the Face of Modernization

Modernizing societies are experiencing many problems related to culture and identity. The author argues that modernization and democracy often alienate groups of people, especially people moving from Islamic to Western cultures, which causes them to be susceptible to radical doctrine. As a result, radical Islamists can offer an identity to people who feel lost and unaccepted in Western society, and that identity includes following the strict, often violent teachings of extremist leaders. Thou...

Modernization, Immigration and Conservation: Counselors Gain Perspective at High Level Conference

Delegates of the 2006 CRE High Level Conference share their perspectives of a program that showcased world-class leaders discussing issues such as obstacles to resolving societal threats, drivers of terrorism, immigration and assimilation, the effects of instant communication, multicultural business environments, and how the emerging Chinese economy will change the world.

The Impact of Cultural Mistakes On International Real Estate Negotiations

When conducting business, individuals often focus on how they think, not how the other party views the situation. This built-in bias is detrimental to international real estate transactions, and can lead to cultural blunders that have a negative impact on business relations. Those who fail to be cognizant of cultural differences and concerns can destroy what might have been a successful transaction. More important, the injured party-often the real estate consultant, investor or broker-typical...

Real Estate Bubbles: Evidence in the Lender-Borrower Relationship

One key to investment success is knowing when to exit. This paper examines the interaction of loan underwriting policies for timing indicators and the lender-borrower difference of opinion about the future and what it says about the upper limit of that market. In typical real estate acquisitions, lenders influence transactions through the loan terms they offer. Indeed, buyer interest in a property at any given price depends largely on loan terms. When the loan terms change, the buyer's intere...

Ground Rents From Maryland to Hawaii: Leasehold Interests in Residential Real Estate

Maryland and Hawaii, though geographically distant, are burdened by the same historical remnants of an English feudal land system. The practice of conveying property through leasehold deeds that require residents to pay ground rents presents numerous problems for the residential real estate market. The author explains the systems as well as their impact on commerce, real estate development, mortgage finance and property rights.