It all got off to a rather inauspicious start for team Tavistock as we discovered our flight had been cancelled and, having been diverted for an unexpected overnight stop off in Zurich, we were to be without our luggage throughout! Very different from the ruthless efficiency we’ve come to expect from Germany’s national airline. Even as I write this note, our luggage is continuing its journey around Europe.
With our enthusiasm tempered, we eventually arrived at a surprisingly busy EXPO 2023. According to the organisers, more than 40,000 people from around 70 countries attended, which is impressive given what the sector has been through since interest rates started rising.
Sentiment was very interesting too. In contrast to previous EXPOs and even the last couple of MIPIMs, where naturally optimistic real estate folk were more inclined to brush off bad news, people were talking openly among themselves and to the media about the challenges we face. For anyone familiar with the grief process, it almost felt as though we’d reached the beginning of the acceptance phase of the aptly named Kübler-Ross grief cycle.
The sector appears to be moving on and putting strategies in place to deal with the new “higher-for-longer” interest rate environment and how to deal with or take advantage of the distress that we keep hearing is on its way.
The acceptance that we are in a long-term structural change was reflected in some of the throw away comments with ‘survive till 25’ becoming the catchphrase of the conference. This realisation was also noted in the bond markets as long-term yields moved out yet further.
People were also talking more positively about investing in UK real estate, which is probably the first time since 2016. So, what were our major takeaways from this year’s EXPO?
– James Verstringhe, Partner