Post-MIPIM musings

On Friday, Greg Sheppard and I returned to Luxembourg from this year’s MIPIM conference in Cannes. Naturally, we’ve been bombarded with questions from everyone we meet or speak to this week. Each person has their own way of asking, but the queries always boil down to two:

  1. (Asked with hopeful expectation of a positive response) “How was it for you?” and
  2. (Asked with varying degrees of anxiety or desperation) “What did you learn that’s useful to me?” or, in other words, “What did you learn about about where the property market is headed in 2011?”

I’ve been glad to give a positive response on both counts. The Riviera Review might moan about the low attendance rate and the cold weather, and from a tourism perspective that’s possibly understandable, but as a property professional, remembering MIPIM’s 2009 and 2010 “doom and gloom” mood, I actually felt quite hopeful by the end of the week.

It’s in my nature to be optimistic, but in my training to be cautious, so I listened hard for clues that would justify my impression that things may be looking up this year. In general, the people we met were serious about doing business. Cautious, still, yes, but willing to explore possibilities. We had some good conversations with people looking to complete what they’ve started, and we emerged with some active leads.

We found funds looking to domicile in Luxembourg, equity available for investing in Luxembourg, and even some banks now willing to look at files that last year wouldn’t have interested them. They seemed committed to lending for prime assets, with secondary still a little neglected, but even there I sensed a will from some to consider financing some well-chosen projects. A few even indicated that they are looking again at some speculative developments.

I even received a few personal approaches from new funds seeking information and help on setting up in Luxembourg. I have several years’ experience as an Independent Director for Real Estate Regulated Investment Funds and for unregulated investment structures, so I was happy to have some initial conversations with them about obtaining legal advice, finding premises, appointing Custodians, sourcing staff, etc. RealCorp specialises in providing solutions to funds, so we are actively pursuing these leads.

A note on Japan: While we are grateful to be very busy with our normal business and with our post-MIPIM follow-up, it is impossible not to be aware, when thinking about buildings, of the incredible destruction that Japan so suddenly suffered on Friday March 11th. I have not yet heard details of direct repercussions for Luxembourg funds invested in Japan, but I know that the tragedy touches many people in Luxembourg on a personal, if not as well a professional, level. As the situation clarifies over the next few days and weeks, if I learn anything of relevance, I’ll post about it here.

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