EXPO REAL 2019 - main takeaways and insights related to crowdlending industry

EXPO REAL 2019 - main takeaways and insights related to crowdlending industry

46’700 visitors
2’190 exhibitors
76 countries
7 halls
3 days 

This year's EXPO REAL 2019 - Europe´s largest trade show for real estate and investments were from a special edition, covering not only a wide range of real estate segments – office, retail, hotels, logistics, residential and the entire lifecycle of buildings, from project development and investment to finance and marketing, but also having a focus at digitalization and the innovations associated with this. A new hall NOVA3 focusing on innovation was a great success attracting everyone’s attention and proofing digitalization strategies are no longer something for the future - they are now a clear component in company budgets. Placed at one corner more than 60 start-ups and lots of other young technology companies with property business solutions made the real added-value to everyone participated.

Our CEO Edgars Mass also was among 46 000 lucky ones, who used a three-day valuable Munich trip to meet current partners, set up new potential partnerships and got calibrated strategic views on Real estate market trends including most current market insights. Those, more related to the crowdlending industry, we will gladly share with You below. 

TOP - 10 Hottest and most discussed trends in tReal estate market from EXPO REAL 2019

  1. Future is already here – micro-apartments & co-living
    Rising density and sqm prices in big cities naturally have made a progress of an average used living space per human decrease, and promising to stay as a long term trend, because of Generation Z wide needs to flexibility and simplicity, also present in living space business.
  2. Citizen flow outside big cities
    High prices, traffic, air are only some of the reasons, why more and more people are considering their living space change to the outside of polluted and expensive centres of big cities. This trend has started even before today and yesterday, but has a stable line and provides real estate market players with opportunities to serve this need for regional expansion.
  3. Solid and stable future investments – student housing and senior living care homes
    This is not a question anymore – will it be a good investment. Instead of that, all topics discussed are the best technology, expansion, next projects, most suitable locations, and appropriate partners related.
  4. Attractive-yield hunters start to look in other property classes – parking spaces, garages, box-storages and other before undervalued classes of real estate
    Finally, someone has turned around and realized that business can earn money also by using instruments, previously not preferred as a bargain or initially prime valued. This tendency is also promising for double-digit yielders not to stuck into long term close to zero returns with the next one apartment rental project in the large city centre.
  5. Overall rising demand for a green living
    Starting from bioproduct stand at a shop, up to rising fitness popularity, more people than ever are also evaluating energy-saving options when choosing their next accommodation. Plenty of room still for energy-efficient, green living standard housing projects.
  6. Real estate as a service 
    Remembering a given answer by Steve Jobs, once in Apple tough times, when he faced a hostile questioner, who said he ‘did not know what he was talking about’ - “You have to start with the customer experience and work backward to the technology”. And in those 14 words, he tells us all exactly where the future of PropTech and Real Estate, lies. With our customers. Real estate is moving from an industry with complexity and Bond-like characteristics to one where the value will be found in the operation and optimization, of businesses. Less and less people now NEED an office to do their work, or a shop to do their shopping. They can just as easily do either from their home, or from a co-working centre, or from a hotel lobby, or in fact, anywhere there is a solid, reliable internet connection. The key now is where do people WANT to work, or shop, or live.
  7. Residential properties more compact, wise planning more important
    This goes on one hand with smart living concept popularity and green environment mindset, where effective resource usage is dominant. 
  8. Countries having a strong economy background - top safest locations for Real estate market
    Nothing new from one side, but, in times of expected possible uncertainty, such approval from global market leaders could be translated like helpful recommendations not try to discover new America, instead concentrate the power and resources on the more effective way doing activities in a known environment. 
  9. Retail and office market significant changes affecting the prop market
    Last years have already shown the well-known phrase – will persist what changes. That is exactly about current retail and office centres – they need to be focused on changes more than any other Real estate asset class because of dramatic changes in the way, how business and leisure world is organized from now, as already described above.
  10. E-commerce is a structural driver – already existing US experience
    Planning of any commercial real estate development should not be without knowing a way, how the overall consuming market around and beyond is organized, how goods and services flow changes could affect future human decisions. Based on US experience, there also were presented obvious evidence in Expo Real 2019 how e-commerce development has left a significant role in the property market. 

    How to earn more than 5% p.a. in the European property market? 

    Of course, there was no evident answer given, as such topic is not a serious part of Real Expo’s leading exhibitors’ agenda, but extracted essence from all heard experiences and future looks gave a clear view, approving every conclusion found “between lines” from market leaders. 

    In large scale, tens and hundreds of millions, and long-term projects - this is almost mission impossible because of complexity and extended project development period, which burns all expected solid returns. Still, the room is left in double-digit annual returns for simple, relatively small (0,5-2 M EUR) and fast turnaround time projects. Property re-development, added-value projects the same as some units of newly built housing at undervalued locations with great future potential are kind of investments to look after higher as usual annual returns. Besides mentioned, strict cost planning plus time-effective construction and experienced local partners always will be the right keys to earn at least 10% p.a. Because of total investment volume, such projects usually are at appropriate demanded locations nearby big cities and the most economically active regions. This perfectly suits our vision, and already heard interest from our partners will lead to well-performing deals for our investors as well as in Norway and German property market, as in other European countries, where demand for smart, modern, energy-efficient living spaces near big cities is high. 

    Also, we would like to share one of the total sum-ups regarding the world economic phase connection to the future turn of the Real estate market. The following extract from EXPO REAL 2019 official press release presents an answer to those who have felt not good with the last time world economy’s health, and those, who worry about the Real Estate market perspective:

    Economic prospects and affordable housing
    In many different forums and at the exhibitors´ booths there was an intense discussion about the future development of the real estate market. One who does not fear a downturn is Professor Dr. Gabriel Felbermayr, President of the Kiel Institute for the World Economy. “We are in a recession but it is not one we need to be very worried about.” The real estate sector is one of the few sectors that benefits from uncertainty, he said. “In a phase like that, people buy property, so uncertainty coming from the White House or from London is actually helpful to this sector; of course it must not be overdone.” Not even Brexit is seriously worrying the real estate sector: “It will be the UK that is really hit by the consequences,” says Dr. Ulrich Kater, Chief Economist at DekaBank. In the future, London will still be an international hub, “although it will in part have to earn back its reputation after Brexit.