Managing Property Business - Essay Example

MANAGING PROPERTY BUSINESS + Details Submitted Managing property Business INTRODUCTION In 2007, a law laying out the rules of REITs came into effect in the United Kingdom. In 2012, a finance act was established that brought changes to the REIT regime in UK. These changes included the abolition of a 2% entry to join the REIT regime and relaxation of listing requirements in the London stock exchange. This brought a step forward in the Real estate investment in UK. This is because it made it favorable for many companies to invest in real estate on favorable terms. Among the companies was BNP Paribas Real Estate. This is a widely spread company in Europe and a leader in commercial real estate services. It has a gross turnover of 662 million Euros and a gross operating profit of 156 million Euros. This company has employed 3,300 employees across Europe. REASONS FOR INVESTING MY 10000 EUROS WITH BNP PARIBAS REAL ESTATE I. Being an investor in London one is guaranteed a dynamic offer in investment. London is one of the most dynamic and large cities of the world. This means there are wide ranges of opportunities available in London. Investment in real estate in this town offers an exposure in insurance, banking, technology, media, education industry and fashion industries. This needs different types of building, specification and a wide range of designs. Investment in this town will offer exposure to different risk profile and will help to reflect the dynamism of the town with creation of new building. Therefore investing my money in a big company will offer me this opportunity of transformation of London (BNP, 2013). II. The Technology, Media and Telecommunications (TMT) have a wide variety of companies associated with it. This includes the computer industry, software industry and start up tech companies. All this companies need a huge space for their location. In addition, the increasing numbers of people employed in these areas need a lot of space to stay and to carry out their work. The growth in these sectors therefore requires a company that is focused into the future. PNB Paribas Real Estate is one such company with research on future trends of the current market. This helps the company to plan and therefore be prepared to meet the future requirement in the dynamic world of real estate investment. With this in mind, it makes it prudent to invest in a company that lives the future and is prepared for the future. This gives security to the money invested (BNP, 2013). III. The economic recovery in UK has increased the confidence of investment in UK. This has increased both local and foreign investment in UK for real estate. Many executives from overseas companies believe that London is a good location for the location of their company due to the rate of economic recovery after the economic recession. London also offers a good environment for innovative companies and they are able to grow well. This therefore is important to invest in a company that is well established in the market and has a potential of growth accelerated by the environmental conditions of its location. BNP Paribas Real Estate being located in Europe is a sure confidence of future growth and gives confidence for the money invested in it (BNP, 2013). IV. With the growth of the retail market in London, the future for real estate management seems to be bright. The good levels of consumer expenditure, the favorable exchange rates for tourism and the number of international retailers that are competing for space in London are some of the factors that brighten the REIT in UK. The retailers in these sectors need space for their business. This therefore requires a company that can be able to cope with this business niche created. For example, the favorable exchange rates in tourism have contributed to the increase in the number of tourism visiting UK. They require space in terms of hotels to spend their nights, shopping malls to buy presents and what they do not have. The locals also stand to benefit, as they need offices to establish in addition, expand their businesses. All these require space. Investing in a company that can be able to satisfy the demands of these people is a sure way that your money is not lost (BNP, 2013). V. The strong demand for hotels rooms from oversees has also facilitated the growth of real estate in London. This has largely been effective since the Olympic games of 2012. The prices of the rooms have also increased leading to the increase in the profits incurred. This also provides a large venture for real estate development. The refurbishment of historic buildings and creation of new buildings that idolize ancient buildings are also a great venture in real estate management in the UK. With the increased length for leasing this property in the UK, the tenants are able to manage their assets from far. This therefore means that the retails created will not only benefit people from near but also far. This means that demand for retail will increase. An example is the hotel industry that provides cuisine from the whole world. This to them they will have a chance and space of introducing a cuisine from their country to London as a form of investment. For a period of 7.4 to 10.4 years, they will be secure with their retail space. Investing in a company with these in mind, such as BNP Paribas provides one with security for the money invested as one is assured to be updated with the demands of the market (BNP, 2013). The ethical considerations in investing in BNP Paribas Real Estate Investing in REITs requires ethical considerations on the company. This helps to know about the motives of the company and if they are in line with the social and political laws and morals of the country or state. Before deciding to invest in BNP Paribas Real Estate, many ethical issues were taken into considerations. This include I. Socially responsible investment. BNP Paribas has to consider the social build up of the people before deciding to invest in a certain real estate investment. This is because the direct recipients of the property will be the people themselves and therefore their social make up has to be incorporated. BNP Paribas has a team of advisors that are credible in making formal offers so that their investment is socially credible (Barry, 2010). II. Originality/ value of investment. The originality of real estate investment in BNP Paribas is something to go by. With an incredible team of researchers, that conduct research in many parts of Europe and in overseas development makes it easy for the company to provide originality in their work (Barry, 2010). Reference List BNP Paribas Real Estate, 2013. Investing in London guide. United kingdom (BNP, 2013) Barry P. Hagness ,Nick Nunnington, 2010. Corporate Real Estate Asset Management Strategy and Implementation. Read More