One of the key issues discussed at MIPIM this year was whether 2015 is the new 2006, but industry professionals have become more alert to the dangers of 'black swans', says incoming RICS president Martin Brühl.
One of the key issues discussed at MIPIM this year was whether 2015 is the new 2006, but industry professionals have become more alert to the dangers of 'black swans', says incoming RICS president Martin Brühl.
Brühl, who is also head of international investment management at Union Investment Real Estate, compared 2006, the last pre-boom year of the last real estate cycle, with 2015 during an interview with PropertyEU TV in Cannes.
'There is some sense of awareness here at MIPIM that 2015 may be the new 2006, a time when everyone thought that the world was going to continue as it was and one could extrapolate trends and yield compression, and suddenly a black swan came around the corner.' Brühl said, however, that the industry has learned lessons from the crash: 'I feel that people are more aware, more educated and more responsible at this time of the cycle.'
Standardisation of measurement standards is playing an important role in allowing investors to expand into new markets, the incoming RICS president said. Union Investment, for instance, has a global strategy. It has a presence in 24 countries worldwide and a potential 'investment universe' defined as 36 core, transparent and liquid markets.
'To see standards being rolled out in a global manner and to see buildings being measured more uniformly is a big factor for us to go abroad. It all makes sense to wrap up the global capital flows which have reached record levels and that’s going to continue. If you think about the growing middle classes worldwide and the need to match assets and liabilities, this is an interesting time both for my Union Investment role and with my RICS hat on.'
Watch the full interview with Martin Brühl on our YouTube channel
