Global Real Estate Transparency Index for 2008

Global Real Estate Transparency Index for 2008

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larget-transparency-score-changes-2006-2008.jpgThe latest Jones Lang LaSalle Real Estate Transparency Index has been significantly enhanced. According to the report, it is clear that overall transparency has clearly improved since the last survey in 2006.

27 out of a total 56 markets have improved their score and out of those, eight countries moved up one full transparency tier.

Overview

The biggest transparency improvements were found in Dubai, Romania, Ukraine, and Russia. Venezuela is the only country overall whose transparency is lower this time around. On average, Europe’s transparency is higher than in the regions of Africa and the Middle East.

The biggest improvements seen this year were in Vietnam, China (PRC) and India.

Africa’s and regions in the Middle East attract more global attention from property investors which brings the transparency issue to the forefront of the regional governments agendas.

In Latin America it was Panama and Brazil that received the largest transparency overall.

Asia Pacific

The 2008 transparency survey included sixteen countries in a Asia Pacific region. A first time inclusion was Cambodia. Some of the worlds shiniest beacons are included within this region, such as Australia and
New Zealand. The least transparent countries are Vietnam and Cambodia.

Interestingly enough, in the last two years, the four most transparent markets in the Asia Pacific region – Hong Kong, Australia, New Zealand and Singapore -didn’t improve their transparency score.

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While India and Vietnam received the most attention, Malaysia, Indonesia and South Korea posted negligible improvements in the same transparency period.

Middle East and North Africa

Markets across the Middle east and North Africa (MENA) are on fire right now. With a growing interest in the region, Jones Lang LaSalle have concentrated on fourteen markets this time around opposed to the three back in 2006.

Out of the lot, Dubai has emerged as the major focus of real estate development across the MENA region over the past five years.

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The improved transparency of Dubai has certainly been one of the major driving forces behind this trend. Leading the board, Dubai has witnessed the greatest improvement in transparency over the past two years of any market covered by the Real Estate Transparency Index.

Europe

The Real Estate Transparency Index covers a total of 33 markets within the European region. included in this are seven additional countries – Croatia, Estonia, Belarus, Bulgaria, Kazakhstan,
Latvia, and Lithuania.

The 2008 Index also provides a deeper assessment of the Russian market. Therefore it has been divided into 3 tiers to provide a better overview of transparency.

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Europe’s most notable transparency features are the contrasts between Western and Central and Eastern Europe. While Western and Central Europe had an average composite score of 1.7, the Central and Eastern European countries scored 3.1 on average, placing them just below the aggregate score for Asia Pacific.

Despite this, the gap is getting narrower as investors broaden their real estate universe and countries seek to legislate to improve and facilitate.

Since the last publication of the 2006 Index, Belgium has seen the development of a new IPD Property Index, which enhanced transparency in terms of the Performance Measurement category. Although there has been little movement in the Index as a result, the establishment of two new REIT markets (UK and Germany) and increased use of derivatives as an investment tool, demonstrates that even transparent and highly transparent markets continue to evolve.

Interestingly enough, Romania – who has recently joined the EU – has witnessed the largest movement in terms of index score and ranking position within the region. Turkey in contrast has no accession status and no certainty about when or if it will join the EU. Nevertheless, Turkey has remained a market characterized by low transparency, and little improvement in rankings or score have been measured.

Americas

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Four of the countries, namely Brazil, Argentina, Chile and Mexico have noted semi transparency, while the other seven countries – Columbia, Costa Rica, Panama, Peru, Uruguay, Venezuela, and the Dominican Republic – registered low transparency.

Overall, seven countries improved their score while two remained flat and one (Venezuela) declined. Brazil is the clear winner with the second largest score in transparency.

Canada and the United States haven’t seen much change since the 2006 Index. According to this
years index, Canada is currently the most transparent country in the world.


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Read and download the full report from Jones Lang La Salle Research