...GENERAL GROWTH PROPERTIES: TO THE BRINK AND BACK December 6, 2011 Students: Yu (Cherry) Chen, Kevin Connolly, Bill Davis, Stephen Duncan, James Faello, Michael Hazinski, Noah Johnson Faculty Supervisor: Joseph L. Pagliari, Jr. Copyright © 2011 The Real Estate Group at The University of Chicago Booth School of Business All Rights Reserved This case study has been prepared solely for academic purposes. It should not be construed as a judgment about or an endorsement of any particular business matter. Moreover, the information contained herein has been obtained from sources we believe to be reliable; however, we make no representation or warranty as to its accuracy. TABLE OF CONTENTS EXECUTIVE SUMMARY ...................................................................................................... - 1 GENERAL GROWTH BACKGROUND ............................................................................ - 7 2004: A Historic Year for General Growth........................................................................ - 9 2005-2006: Secured Mortgages and Increasing Debt ..................................................... - 16 Simon vs. GGP - Capital Markets Strategy ..................................................................... - 24 IMPACT OF THE CREDIT CRISIS .................................................................................. - 31 GGP Faces Liquidity Challenge .................................................................................
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...I have started to begin to look at things different in the aspects of (i) ethics and (ii) international ethics. I have done consulting work for some companies overseas that I was aware "grease payments" were made to the government, to get an expedited approval; however I was not aware that in the sense of ethics these "grease payments" were frowned upon by the US and considered unethical. I understand now that dealing with international companies these practices are seen as the standard or part of the culture; however, working for a domestic company makes me accountable at a different level. One company that interests me is General Growth Properties (Stock: GGP) traded on the New York Stock Exchange with assets located all over the world. Two TCO's that would make it harder to operate multi-nationally would be (D) Contract Law and (I) International Ethics. GGP is a company that deals with land and shopping mall development. Contract law makes it a bit difficult to operate internationally because GGP has involvement in both Brazil and Turkey. Dealing with different countries and different currencies I can foresee contracts being a bit difficult because the terms of the contract would require force majeure. Force majeure would be the contract inclusions of any sudden changes in the government or in the global political climate. Another factor that could make it more difficult GGP for to operate internationally would be international ethics. Per Jennings' article, "the level of [Brazil's]...
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...Table of Contents Executive Summary (JS) 5 Introduction 6 Background / History of the Company(CD) 6 Mission Statement(CD) 7 Business(CD) 7 Major Goals(CD) 7 Corporate Philosophy(CD) 7 Strategic Evolution (KH) 8 Intended Strategies (KH) 8 Emergent Strategies (KH) 8 Stakeholders (AB) 9 Internal (AB) 9 External (AB) 9 General Growth Properties Organizational Structure (KM) 9 Purpose of the Report (CD) 10 External Analysis (KM) 11 Basic Industry Information (AB/KM) 11 Industry Growth (KM) 12 Industry Profits 12 Industry Segments (AB/KM) 13 External/ General (Macro) Environment (AB/CD) 13 General Economic Conditions and Global (CD) 13 Population Demographics(CD) 14 Societal Values and Lifestyles (Sociocultural) (CD) 14 Political, Regulatory and Legal (AB) 15 Technological (AB/CD) 15 Summary of Analysis and Impact (AB/CD) 16 Industry Analysis/Porter’s Five Forces (CD) 16 Threat of New Entrants (CD) 16 Current Rivalry Among Existing Firms (CD) 17 Supplier Power (CD) 17 Bargaining Power of Buyers (CD) 18 Threat of Substitute Services (CD) 18 Industry Attractiveness/Profitability (CD) 18 porters five forces model (JS) 19 Strategic Groups (KH) 19 Internal Analysis (AB) 20 Value Chain Analysis (AB 20 Primary Activities (AB) 20 Inbound Logistics (AB) 20 Strength: 20 Weakness: 20 Operations (AB) 20 Strength: 20 Weakness: 21 Outbound Logistics (AB) 21 Strength: 21 Weakness: 21 Marketing & Sales...
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...to serve its citizens. City Officials Chelsea City Council Juanita Champion jchampion@cityofchelsea.com David Ingram dingram@cityofchelsea.com Alison Moore Nichols alisonnichols@cityofchelsea.com Tony Picklesimer tpicklesimer@cityofchelsea.com Dale Neuendorf dneuendorf@cityofchelsea.com Part II Chelsea Financial Overview & Indicators Part A Community Indicators A-1 Population The Government, incorporated in 1996, is located in Shelby County in north central Alabama. In the year 1996, its population was estimated at 906 and has grown to 2,949 today, making it a 6th fastest growing city in the state based on population. Along with this continued population growth, the City comprises approximately 47.79 square miles. In addition to natural growth within the City limits, the Government also has the power by state statute to extend its corporate limits by annexation, which is done periodically when considered appropriate by the City Council....
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...market 3 Economical 5 Political-legal 7 Regulatory pressure 8 Conclusion 8 References 11 Introduction The UK property market has experienced remarkable development in the last 50 years; with a notable shift in the trends investors tend to use, (Halifax, 2010). The housing market in the UK has seen great change when comparing the figures over the last 15 years. According to Beckett (2014), the rise of housing prices have led to the creation of a good investing opportunity both in the residential and in the commercial property market. The housing boom has been in chaos since the market crashed in the 2007, but as many industries continue to struggle, the UK housing industry is to experience a recovery, many experts speculate. This is due to the increase in the need for housing due to the increase in demand of properties, both for commercial and residential use; and the decrease in supply. Even with most individuals in the UK still struggling to recover from the 2007 market crash, market watchers estimate that the base line is bound to increase and revive the industry. The property industry though has been experiencing a constant boom through the years. A survey by De Montfort University in 2005 showed that the development finance was at £23 billion; this was up from £9 billion, 6 years earlier, (Gibertson, 2006). The trend has been in constant growth despite a few setbacks due to the strain in the economic pressures the European Union is trying to twist out from, and...
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...website, Kyle is home to over 60,000 persons with a projected growth rate of 6.9% between 2010 and 2015 (www.cityofkyle.com). This total conflicts with the US Census website, which reports the City of Kyle was home to 29,293 residents in 2011, and had a projection growth of 4.6% (www.census.gov). Following the US Census calculation the population rate for the City of Kyle would project the 2012 population rate to be 30,640. The two totals conflict sufficiently and will evidently cause some confusion with the projected outcomes. The City of Kyle is considered a Home Rule City, a city with an adopted home rule charter for its local self-governance. In addition to being a Home Rule City, the City of Kyle also operates with a City Manager form of Government. The City Council is comprised of a Mayor and six Council Members. The resident voters choose the Mayor and three Council Members at large and the other three Council Members are elected from their prospective districts. The goal of the proposed budget for the City of Kyle is to maintain the current service levels for all necessary city services. The goals and objectives of the City is the guideline for forming the City’s yearly budget. The budget projection is slated to significantly improve the city’s local business climate over the next few years. Most of the city’s growth stems from workers in the nearby city of Austin, TX, where real estate and property taxes are slightly higher. It is best for the city and it’s...
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...Kyle website, Kyle is home to over 60,000 persons with a projected growth rate of 6.9% between 2010 and 2015 (www.cityofkyle.com). These total conflicts with the US Census website, which reports the City of Kyle was home to 29,293 residents in 2011, and had a projection growth of 4.6% (www.census.gov). Following the US Census calculation the population rate for the City of Kyle would project the 2012 population rate to be 30,640. The two totals conflict sufficiently and will evidently cause some confusion with the projected outcomes. The City of Kyle is considered a Home Rule City, a city with an adopted home rule charter for its local self-governance. In addition to being a Home Rule City, the City of Kyle also operates with a City Manager form of Government. The City Council is comprised of a Mayor and six Council Members. The resident voters choose the Mayor and three Council Members at large and the other three Council Members are elected from their prospective districts. The goal of the proposed budget for the City of Kyle is to maintain the current service levels for all necessary city services. The goals and objectives of the City is the guideline for forming the City’s yearly budget. The budget projection is slated to significantly improve the city’s local business climate over the next few years. Most of the city’s growth stems from workers in the nearby city of Austin, TX, where real estate and property taxes are slightly higher. It is best...
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...2/16/2014 Intellectual Property creation witnessing steady growth in India: Report - Economic Times You are here: Home > Collections > India RELATED ARTICLES Budget 2012: Relax corporate tax and surcharges to boost... March 5, 2012 Intellectual Property creation witnessing steady growth in India: Report PTI Jun 26, 2013, 06.43PM IST Bharti Airtel gives IP contract to Alcatel Lucent India June 1, 2012 Tags: Texas Instruments general motors | Mercedes-Benz | investments | intellectual property | Intel | Hewlett-Packard | | gdp | Alstom | Alcatel Lucent Alcatel-Lucent launches IP Transformation Center Septemb er 8, 2009 IN-DEPTH COVERAGE India Intellectual Property Alcatel-lucent Alstom NEW DELHI: The country's contribution to Intellectual Property (IP) creation is witnessing a steady growth, however, investments in R&D and patent activities in the country are still relatively slow when compared to developed nations, a report says. According to globalisation and market expansion advisory firm Zinnov's study 'Enhancing the IP Quotient in MNC R&D centres', IP creation is witnessing steady growth in MNC R&D centres, but investments in R&D and patent activities in India are still relatively slow. (A sector-wise analysis…) The study further said India spends just 1 per cent of its GDP on R&D, while countries like Israel spends 4.2 per cent, Japan 3.7 per cent, US 2.7 per cent and China 2.0 per cent...
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...THE POLITICAL ENVIRONMENT Canada is a constitutional monarchy, with federalism and a democratic parliament, head by Queen Elizabeth II. With the Prime Minister’s advice, she appoints a Governor General, to represent her authority in Canada, as she resides in United Kingdom. The parliament is responsible to legislate and control the executive branch of the government, i.e. the Prime Minister and Cabinet, consisting of the Queen-represented by the Governor General, the House of Commons and the Senate. The federalism constitutes of 10 provinces and 3 territories and its structure divides government responsibilities between the federal government and the ten provinces. The federal government’s responsibilities include national defense, interprovincial and international trade and commerce, immigration, banking, monetary system, criminal law and fisheries. The three territories also have legislatures, but not sovereign and have fewer constitutional responsibilities compared to the provinces. Canada has a mixed market economic system. The system is unique since it has a combination of private and government control; or capitalism and socialism policies. In a socialist Canada, the principal means of producing and distributing wealth will be the common property of society as a whole. The government regulates most of the trade and businesses. This is to abolish labour exploitation, and to implement a planned approach to the relationship of human life with the natural environment. Poverty...
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...system can influence on the growth? The most common arguments are: property rights, pressures for immediate consumption and autonomy of dictatorship. While there is an agreement that respecting property rights helps the economy, it is controversial which system is more efficient, concerning this problem. Pressures for immediate consumption are considered to be the main reason while democracy may hinders the growth. In opposite, there is a third argument – autonomy of dictatorship. Dictators do not have to handle with pressures made by different interest groups, however there is no reason why dictator would like to maximize total output, not his own. In the further part of this essay, these problems are discussed more deeply. There is not under discussion among the economists that property rights are one of the most important factors which influence on the growth. However, there is no clear prove that democracy project them. The strong state can protect property from private intruding but at the very same time it is a potential threat itself. If we consider countries like the USA or the United Kingdom – the most developed democracies in the world, of course we may conclude that their elected democratic governments, no matter if from left or right party, are not a danger for property rights. However, in such countries the respect for property rights is obvious and it has almost no influence on the growth anymore. The different...
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...MISSION 3 1.2 COMPANY VISSION 4 1.3 GENERAL INFORMATION OF PLB ENGINEERING BERHAD 4 2.0 GENERAL ENVIRONMENT ANALYSIS 5 2.1 POLITICAL FORCES 5 2.2 ECONOMIC FORCES 5 2.3 SOCIAL FORCES 6 2.4 ENVIRONMENTAL FORCES 6 2.5 LEGAL FORCES 7 2.6 TECHNOLOGICAL FORCES 7 3. 0 TASK ENVIRONMENT ANALYSIS 8 3.1 PORTER’S FIVE COMPETITIVE FORCES 8 3.1.1 THREAT OF NEW ENTRANTS 8 3.1.2 SUBSTITUTE PRODUCT 9 3.1.3 BARGAINING POWER OF BUYERS 9 3.1.4 BARGAINING POWE OF SUPPLIERS 9 3.1.5 RIVALRY AMONG EXISTING FIRM IN INDUSTRY 10 4.0 SWOT ANALYSIS 11 5.0 TOWS / SWOT MATRIX 12 6.0 RATIO ANALYSIS 13 7.0 STRATEGIC DIRECTION 14 8.0 OTHER RELEVANT INFORMATION TO CONVINCE THE BOD OF BRAVO PLC. 15 48 9.0 REFERENCES 16 1.0 PLB Company profile PLB Engineering Berhad engages in the housing development, property letting, and investment holding. The company, through its subsidiaries is involved in property development and construction activities. PLB Engineering Berhad has evolved from its humble beginnings in foundry and fabrication of machinery parts to be a player in the construction industry with experience of more than 30 years and projects worth RM2 Billion since 1973. It is currently listed as a main board company on Bursa Malaysia Securities with a paid-up capital exceeding RM91 million. It focuses on two core activities, which are Construction and Property Development. They believe that they are...
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... 1.1 Products and Services The primary revenue center for the business is acquiring apartment complex properties with the intent to rent the properties to the general public. The business will generate profits from both the ongoing rental income paid to Apartment Complex, Inc. while generating capital appreciation from the long term holding of these properties. Now that that the real estate market has hit come to its bottom, Management expects that the market will have a future growth rate of 5% to 6% per year. The third section of the business plan will further document the residential rental services offered by the business. 1.2 The Financing Mr. Doe is seeking to raise $1,000,000 from an investor. The terms, dividend payouts, and aspects of the deal are to be determined at negotiation. This business plan assumes that an investor will receive 50% of the Company’s stock, a regular stream of dividends, and a seat on the board of directors. The financing will be used for the following: • Financing to acquire the initial Apartment Complex property. • Financing for the first six months of operation. • Capital to purchase a company vehicle. Mr. Doe will contribute $10,000 to the venture. 1.3 Mission Statement Mr. Doe’s mission is to develop Apartment Complex, Inc. into a premier regional real estate investment firm that will acquire apartment complexes and rent properties profitably. 1.4 Mangement Team The Company was founded by John Doe. Mr. Doe has more than 10 years of...
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...Property yields as tools for valuation and analysis Rosane Hungria-Garcia in collaboration with Hans Lind Björn Karlsson This report has been sponsored by the Real Estate Academy at the Division of Building and Real Estate Economics. Stockholm 2004 ______________________________________________________ Report No. 52 Building & Real Estate Economics Department of Infrastructure KTH Summary This project was started in order to get an overview of conceptual problems, measurement problems, theories of determinants of yields, the use of yields in different contexts and how the actors on the Swedish market looked upon yields. Important issues discussed in the report is the need for: - Conceptual clarity: A number of different yield terms exist on the market and it is very important to be clear about how the specific terms are defined. - Operational clarity: There are measurement problems both concerning rental incomes, operating and maintenance costs and property values. This means that reported yields can be “manipulated” by choosing suitable operationalisations and pushing estimations of uncertain factors in directions that are favourable to the actor in question. - Specify the purpose for which the yield should be used. The most important distinction is between using yields/income returns for valuation purposes and using yields as benchmarks or bubble indicators. In the first case various types of normalization of the net operating income can be rational. In the second...
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................. b. Background of the Study and Market Trends ................................ 1. 1997 Asian Financial Crisis 2. The Late 2000 US Property Bubble 3. Real Estate Market Trends II. Analysis of the Philippine Real Estate Industry………………………………….. III. Conclusion ............................................................................................ IV. References………………………………………………………………………………………… Annex A. Major Industry Players Annex B. Further Developments by the Major Industry Players Annex C. Present Global Situation 2 I. INTRODUCTION A. Statement of the Problem The purpose of the study is to determine if there is an impending property bubble in the Philippines, citing current indications similar to the 1997 Asian Financial Crisis and the US Property Bubble in the late 2000, as well as comparisons with the general real estate market trend. B. Background of the Study and Market Trends 1. 1997 Asian Financial Crisis and the resulting Philippine property bubble The 1997 Asian Financial crisis was a period of massive economic meltdown, the most severely affected countries of which were Indonesia, South Korea, and Thailand. The Philippines and the rest of the Asian region were also hurt heavily by the slump. In the local real estate sector, evidences of property bubble were clearly observed...
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...price in the 1980s.in the 1970s and late 1980s the growth in the house prices was coincided with the period of the general inflation, so therefore in 1998-2008 hose prices are rising but at different rate but in negative figures. Within this period the UK house prices behaved fairly similarly within the regions. Within this period there have been a regional difference in the uk house prices over this period, whereas London stands out when other house prices are growing at three times in the national average, examples places where house prices are cheaper like wales and northern Ireland have tend to have higher rates of unemployment than places where house prices are more expensive like London and south east. Also in the regional difference there is possibility for people to migrate from north of England to south east and London.in other words it is aid that the k house prices have really gone down recently. Question 2: How have UK house prices behaved relative to general inflation and incomes? How would you describe the current affordability of UK houses? ANSWER: The affordability of the UK house prices depends on two things which are the income and the interest rate of the country. The real rate of interest adjusts the nominal rate for inflation, the affordability of the up house prices deteriorated from the late 1990s; the growth in house prices in the late 1970s and 80s coincided with periods of the strong general inflation. But currently affordability of house prices...
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