INCANS Risk INSIGHT
INCANS Risk INSIGHT publication issue 7: A square peg in a round hole
We have entered an incredibly tough economic environment. The cost of lending has risen sharply and values are plummeting. In these circumstances, one fundamental aspect of commercial real estate comes to the fore: it’s all about rental income.
Data from MSCI consistently shows that about 70% of the long-term return from commercial property in developed markets comes from the income component. While capital growth fluctuates considerably, income return is what pays the equity dividends, fund distributions and advisory fees that drive the market. It also services the all important debt cover on property loans.
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INCANS Risk Insight Publication Issue 8: Banking Crisis
Implications & Strategies For Commercial Real Estate
INCANS Risk Insight Publication: Breaking Out Of The Frame
Core, prime, opportunistic – what does it all mean? Years of subjective labelling of real estate assets is leading to poor decision making.
INCANS Risk Insight Publication: The Power of Data
What lessons has the real estate industry learnt, 15 years on from the Credit Crunch?
INCANS Risk Insight Publication: Unlocking Real Estate’s Data Potential
In this quarter’s INCANS Risk Insight, the overall theme is how data will be crucial for allowing us in real estate to make better informed decisions.
INCANS Risk Insight Publication: Capital Values Exit the Building, Analysis of Income Enters
For decades there have been calls for a re-think on CRE valuations. Now with the perfect storm of a data revolution, shorter leases, more operating expenses, ESG and Covid, this is the time the property valuation community could finally accept that analysis of the income is more important than capital values.
INCANS Risk Insight Publication: How Well Do You Know Your Tenant’s Income Risk?
2021 will see commercial real estate tenants will pay rent of more than US$1,400bn. In a low capital growth market commercial real estate becomes a fixed income style investment with a floating capital opportunity attached. But, in the current pandemic, it’s important to understand the occupier, their business environment, along with specific requirements.
INCANS Risk Insight Publication: Quantifying the Risk of Tenant Failure
The growing popularity of commercial real estate as an investment is hardly surprising given the prevailing central bank policy of a zero-interest rate environment. Under such conditions government and corporate bond yields no longer deliver the required returns so investors have been forced to look elsewhere for a stable and recurring revenue stream.