Blackstone is no stranger to huge deals, and its latest transaction makes it the owner of 3.5 million square feet of industrial property in the United Kingdom. Prologis Inc. sold the 13-property portfolio for an aggregate $335 million.

“We were pleased with the amount of interest this portfolio garnered as the combination of quality assets and lease term appealed to multiple investors,” Philip Dunne, president of Prologis Europe, said. “We have sold this portfolio as it no longer fit within our investment strategy, and offered us the ability to redeploy our capital.”

The portfolio comprises 13 properties located in England’s Midlands and Yorkshire. The properties are 100 percent leased with an average unexpired lease term that exceeds nine years.

Blackstone has been picking up large parcels of property in multiple sectors of late. In early January, the firm — in a partnership with DDR Corp. — spent $1.4 billion on a 47-property retail portfolio across 20 states. In December, Blackstone purchased 36 shopping centers from Equity One Inc. for $473 million, including the assumption of $177.4 million in debt. In October of last year, the firm purchased $1.1 billion of office assets from Duke Realty Corp., netting it 10.1 million square feet of property across 82 buildings.

The U.K. industrial market is similar to its Stateside counterpart, ending the year on a mixed note as events in Europe threaten to erode the confidence that rose toward the end of 2011. According to a fourth-quarter report by services firm Cushman & Wakefield Inc., manufacturing surveys at year’s end pointed to improved performance in December, but the strong showing didn’t erase the weaker outturns for October and November – when many producers reported their worst quarters since the middle of 2009.

JLL's Peter Roberts at Davos.

As the world emerges from a year of immense global change marked with social, political and financial instability, I approached my time at the annual meeting of the World Economic Forum at Davos with great anticipation. The theme of this year’s meeting of 2,500 of the world’s business, government and cultural leaders was ”The Great Transformation: Shaping New Models.”  This was an apt focus given the vast changes the business community is experiencing in technological advances, financial reforms and global economic power.

The mood was upbeat and determined.  Of particular note to those of us in the commercial real estate industry were the focus on the Euro zone, the growth engine in Asia and opportunities in Latin America.

In her opening address, the German Chancellor, Angela Merkel, espoused her commitment to the euro and greater European integration.  She conveyed optimism for the future but made it clear that labor productivity will be key to Europe’s revival. The frustration shared by many in Davos, however, was the lack of progress in crafting a solution to what ails the region.

Our firm’s paper, “A New World of Cities,” reports that 50 percent of global commercial real estate investment is concentrated in only 30 cities around the world. But we also see this as a decade of change as investors widen their horizons. As a sign of investor confidence in key European markets, London and Paris continue to be top picks for real estate investment.

Moving eastward, in the same research we found that the top ten cities for real estate investment include five from Asia.  Back in 2004, this figure was just two, and over the next decade the ten fastest growing cities in terms of GDP will reside in China.  China’s explosive growth will be positive for our industry as it drives demand in the region and globally.

Asia’s exorbitant growth turns the conversation to how resource scarcity will put a premium on sustainable development in the next decade. It is clear that both the private and public sectors will have critical roles in advancing the agenda for urbanization and ensuring that it is done with sustainability front of mind.  While an enormous challenge, this is an area for which our sector can provide essential advice and guidance.

Turning to the Americas, President Felipe Calderon of Mexico made it clear that he recognizes the importance of Mexico being viewed as a positive investment destination.  With more than 80 percent of that country’s exports going to the United States, a vibrant Mexico is important to companies throughout the Americas – indeed, throughout the world.  I came away from the session with President Calderon feeling positive about Mexico’s prospects.

During my discussions with clients, business leaders and government officials, a number of key takeaways surfaced for our sector: Globalization of the industry will continue, capital sources will demand greater transparency, sustainability and energy management will climb the agenda.  Corporate occupiers are not in the throes of downsizing or scaling back; they are on the front foot, operating in an environment where uneven growth prospects around the world require agility.  The implications for their real estate are simple: flexibility is key.  All in all, from my conversations with global investors, it’s clear that real estate is viewed as a desirable asset class, a mindset working in our favor.

“Debt” is going to be the name of the game for the European real estate markets in 2012, according to Emerging Trends in Real Estate Europe 2012, the industry forecast published by PwC and the Urban Land Institute. With daily reminders that interest-rate cuts on Greek bonds are still in limbo and debt-rating decreases for Euro-zone nations are on the rise, a turnaround looks to be tied directly to banks’ willingness to make commercial loans and whether the financial industry could face another collapse. The survey took responses from more than 600 commercial-property professionals across Europe to determine the overall course of the industry.

“The profound instability is affecting the providers of equity and debt,” Joe Montgomery, chief executive of ULI Europe, said. “We are operating in an environment that is very difficult to model. The uncertainty over the level of banks’ exposure to sovereign-debt default, coupled with uncertainty over the regulatory changes introduced as a result, has caused significant elements of the capital markets to be reduced to a state of near paralysis.”

In general, lenders are facing a level of pessimism over debt at levels not seen in years, according to John Forbes, the report’s author. Only 6 percent of lenders think that debt will be as available this year as it was in 2011, and a full 52 percent feel it will be substantially less available.

But not all news is gloomy, however. “The good news is that the view of respondents regarding the availability of equity is much more positive,” Forbes wrote. “Most promising is the response from institutional investors: 65 percent believe that equity will be moderately more available, with a further 10 percent believing that equity would be substantially more available.” And those lenders will play a significant role in the economy’s health, as all the players are interconnected. Mezzanine lenders need senior lenders to push debt into the marketplace, and insurance companies need time to build the right infrastructure to deploy capital.

With such uncertainty, it was difficult for the survey’s respondents to make sweeping generalizations about market sectors, but geography will certainly play a role in how investments will roll out from city to city. Istanbul, the report noted, has been the top market for commercial real estate investment for the past two years, “but that ranking is more a reflection of its long-term economic future than a sign that investors are about to rush to place their capital in the market.” And, while debt concerns continue to plague Spain and Italy, opportunistic investors may still see possibilities as banks begin to release assets later this year.

Overall, 2012 could be a turning point, the year that investors have been waiting for – or it may turn out to be a bust. Pressures from all directions could make finding funding solutions for banks an imperative, but whether investors get the bargains they would like is still very much an unknown. In general, the report’s bearish mood reflects the larger overall picture, and the coming months will certainly tell a clearer story.

Capitalizing on the increased need for both office and retail space, Hines has partnered with DLF Ltd. to begin construction on One Horizon Center, which will be located southwest of New Delhi in Gurgaon. The project will include a 25-story office tower with 800,000 square feet of space, as well as 65,000 square feet of retail.

“Along with DLF, we are proud to celebrate the start of construction of One Horizon Center,” Hines CEO Jeffrey Hines said. “India is an important market for us with huge potential, as we see growing demand among discerning clients. We have invested significant time to study and understand the needs of the market, and we are committed to extending our international best practices to this development.”

According to a report by Cushman & Wakefield Inc., demand for quality real estate in India is going to see strong upswings. “Retailer expansion in India is a result of a combination of strong economic growth driven primarily by internal consumption backed by quality retail supply being provided in major cities across India,” Jaideep Wahi, director of retail services for India, said. “Growth in the luxury sector has been a rising trend. 2012 will provide a conducive environment for further retail expansion in India, with continued economic growth and new shopping centre supply in the top ten cities.”

Additionally, a report by Jones Lang LaSalle Inc. pegs India’s GDP growth at 7.7 percent for 2012, “as generally vibrant consumer spending should help to offset slowing exports and investment spending.”

One Horizon Center marks Hines’ first project in India and is scheduled for completion in 2013. The structure is being built to LEED sustainability criteria that includes a dual-paned glass façade.

Jones Lang LaSalle Inc. has acquired Sydney-based tenant advisory firm MPS Properties, the company’s Singapore office announced. The purchase, which strengthens Jones Lang LaSalle’s top position in tenant representation in Australia, makes MPS a wholly owned Jones Lang LaSalle company. With the acquisition, JLL reportedly manages transactions across approximately 43 million square feet of Australian office space.

MPS was founded in 1994 by current head Steve Urwin and operates across Australia in both tenant rep and project management. Its team of six tenant-rep advisors and three project managers are being retained under the new structure. MPS’ clients include PricewaterhouseCoopers, Sony Australia and Swiss Re.

“The acquisition of MPS … is part of our strategy to increase market share in key countries, including Australia, and to expand our service offering to clients,” said John Forrest, CEO of corporate solutions for JLL in the Asia-Pacific market.

According to mid-year 2011 figures from the Property Council of Australia, total vacancy in Australia’s office markets decreased from 9.6 percent to 9.0 percent in the first half of 2011, the lowest level in two years. The decline reportedly was the result of stronger demand and lower-than-average supply. Net absorption over the period was 2.36 million square feet, or about 18 percent above the average over the previous 20 years.

It’s akin to a good marriage. Carlson and The Rezidor Hotel Group have come together in a union that will allow them to act as one, while maintaining their own individual identities. The two international hotel companies just formed the Carlson Rezidor Hotel Group, a separate hotel entity created to be a global force in the hotel industry.

Carlson and Rezidor will remain separate legal entities.

The decision to join forces and create a new company was born from a synergy created between Carlson and Rezidor through working together for nearly two decades. The two first teamed up in 1994, when they entered into a master franchise agreement for the Radisson brand in Europe the Middle East and Africa. In 2005, Carlson acquired a 25 percent interest Rezidor, and continued to increase its ownership stake in the company over the years until it became majority shareholder with a 50.1 percent interest in 2010.

Carlson Rezidor makes its debut as one of the largest hotel groups in the world, with a portfolio exceeding 1,300 hotels carrying a range of premier hotel flags across 80 countries. In a prepared statement, Kurt Ritter, president and CEO of Rezidor, explained the new company’s objective. “The goal of this development is to generate more attractive financial returns for the owners and greater value for all shareholders, to be perceived by business partners around the world as one global hotel company, to offer more compelling and consistent value propositions to the guests, and to offer global career and development opportunities to the staff.”

The new company’s financial aspirations entail the production of at least $400 million in additional revenue and a nine-point expansion on the RevPAR Index by 2015. Indeed, industry experts forecast notable revenue increases for the hotel sector in a bevy of major metropolitan areas across the globe; although, those increases are not expected to be as large as they were in 2011. Of the 10 top markets in the Europe and Asia Pacific regions, Hong Kong topped the list with RevPAR growth of 24.7 percent in 2011, according to an early report by STR Global. The hotel research firm anticipates that Singapore will lead the pack in 2012, with estimated RevPAR growth of 9.6 percent, nearly one percentage point lower than 2011’s 10th highest ranking city, Cologne. Overall, RevPAR in the U.S. rose an estimated 6.1 percent, and it is on track to jump 8.6 percent.

Carlson Rezidor will maintain headquarters in both companies’ respective corporate office locations of Minneapolis, Minn., and Brussels, Belgium.

The Scotia Centre in Calgary

Less than two years after CANMARC Real Estate Investment Trust completed its initial public offering, there appears to be no end in sight to its shopping spree as the REIT commits to the purchase of three commercial properties. With the closing of the acquisition, CANMARC will have enhanced its portfolio by 664,400 square feet of office and retail space located from one end of Canada to the next.

In Calgary, Alb., CANMARC will take its co-ownership to sole ownership with the purchase of the remaining 50 percent interest in Scotia Centre, a premier 630,400-square-foot office building downtown. The 42-story high-rise encompasses 546,400 square feet of office space, as well as 84,000 square feet of retail space on a three-story concourse. The price tag on the property, sited adjacent to a light rail transit station, is $140 million.

CANMARC will also add the 283,000-square-foot Woodside Square in Toronto, Ont., to its portfolio for nearly $59.3 million. Occupying a 24.5-acre site spanning a full city block, the enclosed, single-story community shopping center also features a 9,000-square-foot mezzanine level with office accommodations and a movie theater.

Marché Jonquière, a 66,200-square-foot mall in Jonquière, Que., will also come under the REIT’s ownership. The grocery-anchored neighborhood strip center will come at a cost of approximately $13.8 million.

CANMARC plans to finance the purchase of the three properties through $94 million in new mortgages, cash on hand, funds from credit facilities and the assumption of $37 million of debt.

“With these three accretive acquisitions today, CANMARC continues to deliver on its strategy of building a solid footprint of office and retail properties in key real estate markets across Canada,” Jim Beckerleg, president and CEO of CANMARC, noted in a prepared statement. ” We have maintained a steady pace of growth since our initial public offering in May 2010, with fourteen accretive acquisitions and a strong track record of organic growth.

Tishman's The Springs Development in Shanghai

Following increased demand for its products in China, Nike Inc. has just announced plans to build a 600,000 square foot corporate campus in Shanghai. The sports-equipment maker has selected Tishman Speyer’s new mixed-use development in the city’s Yangpu District, The Springs, as the campus’ future site. Nike expects to move into the new campus by the first quarter of 2014 and will be the first office tenant in the $2.5 billion development.

According to the company’s financial documents, revenue for all Nike products in China increased from $1.7 billion in fiscal 2010 to $2.1 billion in fiscal 2011, making the country one of the company’s highest-growth markets.

Calling the move “a strategic investment in our continued growth in China,” Craig Cheek, Nike’s vice president & general manager of Greater China, said that the move will unite all Shanghai employees into one central location.

Nike has signed a long-term lease with Tishman for the developer to create more than 587,227 square feet of space in a multi-building campus. When complete, the campus will have up to three buildings, a five-story conference center, basketball court and soccer field. The development is located between Shanghai’s two airports, Hong Qiao and Pu Dong, and will be built along a subway interchange.

According to Nike’s most recent SEC filing, the company creates 33 percent of its footwear in China, making the move one of consolidation. Additionally, Nike saw a 24 percent increase in future orders from the June-to-November quarter when comparing 2010 to 2011.

The Springs is Tishman Speyer’s largest project in China and follows the development of previous successful commercial projects in Tianjin and Chengdu. The Springs broke ground in June 2011 as a 9.7 million-square-foot green community that will, at completion, feature residential units, commercial, hotel, office and retail space.

Looking to capitalize on what will certainly be a growing economy in the next few years, Clarion Partners has acquired 78 acres of land in a northwest suburb of Sao Paulo. The company intends to develop and lease a Class A industrial facility that will eventually include 1.4 million square feet of space.

The project, slated to be a joint venture between Clarion and one of the firm’s clients, already includes a $100 million equity investment. As managing partner of the venture, Clarion has already forged a relationship with DHL Supply Chain – a company that has been a part of the Brazilian industrial market for more than a decade.

“Brazil is vibrant and growing, supported by powerful underlying fundamentals,” Jeb Belford, a managing director at Clarion, said. “With a lack of high-quality warehouse space in many parts of the country, we believe this provides an excellent opportunity to participate in the continued expansion of this increasingly important market.”

With major events on the country’s horizon, including the 2014 World Cup and the 2016 Olympics, Brazil is likely on the cusp of a boom period. Services firm CBRE Group Inc., in a December 2011 report, noted that industrial rents across the globe will continue to rise this year, especially calling out the São Paulo region. The city’s average asking rents for prime industrial space – which is exactly what Clarion intends to build – is the fourth-highest worldwide (exclusive of the United States), surpassed only by Tokyo, London and Singapore. Currently, the average sits at $13.98 per square foot.

Construction on the project began last month, and is slated to complete in mid-2012. DHL Supply Chain will lease approximately half of the first completed building, as well as “substantial portions of buildings two and three for itself and its clients.” The additional buildings are expected to be complete in 2013 and 2014.

The United States remains the No. 1 choice for crossborder investors in commercial real estate, but its popularity has slipped somewhat, according to the 20th annual survey of members of the Association of Foreign Investors in Real Estate (AFIRE), which was conducted by the James A. Graaskamp Center for Real Estate of the Wisconsin School of Business and released as the New Year rung in.

In the opinion of AFIRE members, the United States still offers the most secure option for real estate investment, but they also say that “improved property fundamentals” and the “repeal of FIRPTA”–the Foreign Investment in Real Property Tax Act of 1980–would spur further investments in U.S. real estate.

A clear majority of survey respondents, 60 percent, say they plan to increase their investment in U.S. real estate in 2012, but that number is down from a stronger majority of 72 percent who said the same thing at the beginning of 2011. Although the United States is still regarded as providing the best opportunity for capital appreciation, only 42.2 percent of the respondents placed it first for 2012, down from 64.7 percent last year. The runner-up country in capital appreciation potential was Brazil, with 18.6 percent of the respondents picking it as the best nation for capital appreciation.

Indeed, Brazil is a hotspot these days among CRE investors, along with its largest metro area, Sao Paulo. Only last year, Brazil was placed fourth in capital appreciation, but now it has pushed China into the third position. On the other hand, the euro-zone crisis has investors spooked about that part of the world, according to the AFIRE survey, with all European countries except Switzerland–and even Germany–falling in the estimation of CRE investors.

Markets Calm–for Now

Wall Street took the day off on Monday for the legal New Year’s holiday, but there was trading elsewhere in the world. No extreme gyrations, however. For example, the Stoxx Europe 600 was up 1.1 percent on Monday on news that German manufacturing was stronger than expected, while in Asia the likes of the MSCI Asia Pacific Excluding Japan Index gained 0.6 percent, and markets in Australia and South Korea were up as well.

Besides inspiring precipitous drops in the broader equities markets in late July 2011, there were other strong indications that the almost-default by the federal government over the summer was understood by investors as the near train wreck that it almost was. The Chicago Board Options Exchange Volatility Index (VIX), evocatively nicknamed the “fear gauge” by investors in options, had a roller-coaster of a year as well, with a particularly fearful moment at exactly the time of the debt-ceiling crisis.

Specifically, the VIX rose like a bottle rocket in mid-summer to the 30s, which represents quite a bit of fear, since there seemed to be some chance that Congress might really let the United States default. Extra nervousness came after the crisis was (putatively) solved, when despite the last-minute deal in Congress, the country’s rating was downgraded anyway. Since last summer, things have calmed down for the VIX, which is currently in the low 20s, roughly the same level as before the default crisis. Calm for now, that is. VIX futures seem to indicated that investors think 2012 might also be a roller coaster, depending especially on what happens in Europe.