The Leader - January/February 2009 - (Page 12)

reaL eState ManaGeMent Mergers & Acquisitions: How Real Estate Can Play a Key Role By Lee eLLiott, SheLLey FroSt, DaviD McMiLLan anD ShirLey Ghan T he urge to merge has never been greater among corporate occupiers. More than 50,000 M&A deals have been completed in Europe since 2000, with a combined value of US$4.7 trillion (€3.3 trillion). As the desire to enter into new and emerging markets, deliver new business lines and services, or create truly global and efficient scale has taken hold, M&A has become the strategy of choice. Indeed, a recent Jones Lang LaSalle survey found that 34 percent of the FTSE 350 companies viewed consolidation via M&A as one of their key strategic objectives between now and 2010. The M&A market has witnessed a 21st Century boom. Thomson Financial note that more than 31,000 M&A deals were announced worldwide in 2007 and that at Q3 the market was up 50 percent on the equivalent period in 2006, and 2008 has shown a similar trend. Significantly Europe accounts for some 40 percent of these deals. The frenetic pace has only recently slowed as uncertainty around the full and lasting implications of the credit crunch prevailed. An increasing proportion of global M&A activity (45.5 percent) has been cross-border in its geography, and has fuelled the emergence of truly global corporate occupiers across a range of sectors. In Europe, M&A has been adopted as a key strategy in gaining exposure to the CEE market. Thomson Financial note that there has been a 113 percent increase in the value of Eastern European M&A activity over the last 12 months – making the market in Eastern Europe larger than France or Germany in both monetary and volume terms. Private equity firms have been a key feature of the market. From a property perspective their interest has been in deals where operating-company / property-company opportunities exist and the monetization of real estate assets is possible. The reverbera- tions of the credit crisis mean private equity players have become less active recently, but there is no shortage of funding sources for M&A, with sovereign wealth funds being suggested as a significant driver of the market going forward. While the characteristics and drivers of the European M&A market are clear, the practical implications of M&A for the Corporate Real Estate (CRE) function both pre- and post-transaction have not often been articulated. This paper addresses this by focusing on how to best position CRE teams to support the M&A process fully, maximizing the opportunity and lowering the corporation’s exposure to risk. the role of cre in M&a CRE teams have a pivotal role to play in supporting the wider organization through the enormous changes and challenges presented by M&A. The role of CRE teams during the M&A process is five-fold: 2 0 0 9 th e Le aDe r 12 January / FeBruary

Table of Contents Feed for the Digital Edition of The Leader - January/February 2009

The Leader - January/February 2009 Contents Leadership Message from the CEO Real Estate in the News Mergers and Aquisitions Assessing Green Building Performance Measuring Space You Actually Use Global Trends in Sustainable Real Estate Whirlpool’s Lee Utke Northmarq’s Kevin Farrell Plastics: Hoping for Resiliency in Resins Regional Profile: Heartland Holding Strong Industry Profile: Ascendas Brings New Age Business Space to Asia-Pac Industry Tracker From the Applied Research Center Discovery Forum Findings Capital Corner Career Development Young Leader Economic Development in the News Learning Spotlight Connect With CoreNet Global Index of Advertisers A Look Ahead In our Next Issue Calendar of Seminars

The Leader - January/February 2009

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