Category Archives: Global

Brexit’s potential implications for the U.S. economy and property markets

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The surprise result of the UK’s exit vote has created significant political uncertainty and financial volatility. However: We believe the economic and property market impact for the United States will be relatively small. 

The risk of a renewed financial market crisis is the big concern, but the financial markets have already started to come back after a rout the first two days following the vote. Brexit will not… Read More

 

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Image Credit: Shutterstock

Global goals to increase food productivity by 70 percent by 2050 are encouraging the logistics sector to begin a fresh wave of expansion.

The task of feeding a projected global population of 9 billion within 35 years is on the agenda at the World Economic Forum’s annual meeting next week in Davos, Switzerland. Sustainable food provision on this scale will entail more local production and complex transport solutions.

But there will also be a growing need to transport food – as quickly and safely as possible – across borders and around the world. Blueberries from the U.S. and lamb from Australia and New Zealand are among a long list of perishables which must be exported to foreign markets in greater quantities if we are to have any chance of meeting the 70 percent target.

Crucial to the transportation of this produce will be a sophisticated network of refrigerated warehouses which covers key locations including transport hubs, border points and local supply and distribution centres. Aaron Ahlburn, JLL’s Director of Research for Industrial, says: “If you are going to achieve a 70 percent growth in yield it likely requires some complex, correlated growth in cold chain real estate around the world to ensure safe food storage, food quality and efficient distribution.”

More food supply crossing international boundaries increases the need for cold storage – not just because distances travelled tend to be longer but also because of the greater potential for delays. The unexpected often happens – through prolonged border controls, for instance, or labor disputes.

The UK, a large exporter of salmon and cheese, has recent experience of the dangers here; numerous truckloads of fish rotted on English shores in summer 2015 when angry ship workers blocked entry to the French port of Calais. “According the Food and Agriculture Organization (FAO) of the United Nations, an estimated 40% of global food production is lost or wasted each year.   A large percentage of this loss can be attributed to the lack of adequate ‘cold chains’ – refrigerated transportation as well as distribution facilities” saysRich Thompson, Global Leader, Supply Chain & Logistics Solutions consulting at JLL.

The world’s three most populous countries – China, India and the U.S. – are the ones which have done most to build their ‘cool cargo’ networks so far. Global warehousing capacity in the sector is increasing at about 10 percent a year and has reached a total of 552 million cubic meters, according to the latest statistics from the Global Cold Chain Alliance. Included among the states that have a degree of cold storage infrastructure in place are some with the most serious political problems – such as Afghanistan and Libya.

Consumers trends to drive change

Ultimately, the actions of consumers rather than the edicts of governments will have the greatest influence on supply lines in stable countries. In particular, the growth of online grocery shopping will have a direct effect on long-distance supply and storage of fresh produce. As online ordering increases, retailers are able to use ‘big data’ analysis to monitor and predict buying habits and future demand.

However, differing cultural attitudes – especially the desire to see foodstuffs before buying – are leading to wide variations in uptake between one country to another.

Chinese consumers are proving more willing to experiment with internet purchasing than, for instance, consumers in South Africa and in France. The Chinese are expected to be ordering450 per cent more from online groceries by 2020, according to e-commerce researchers Profitero.

“Increasing interest in healthy food, and a growing middle class in locations such as China, are pushing cold chains to globalize. Global complexities, focus on cost reduction, and a lack of cold storage facilities remain big challenges, but with demand for fresh food growing, we are seeing distribution companies becoming more incentivized to overcome capacity and infrastructure constraints to meet this demand” mentions Thompson.  This means that digital buying of groceries – whether through ‘click & collect’ or home deliveries following an online order – is set to push the sector up from US$40 billion to US$180 billion by the end of the decade in the People’s Republic.

While retailers have struggled with the upfront costs and economics of entering the online sector, there are signs that the trend has bedded down in some countries. Online grocery shopping has taken six percent of the total market in the UK where over 80 percent of the population live in towns and cities and so are within easy reach of distribution networks.

Locations close to cities are ideal sites for cold storage warehouses, according to Ahlburn. “This is going to be about how close you can get your time-sensitive food storage to your end consumers,” he says. “Being close to cities is going to be a requirement as economies mature and demand increases.”

A specialist market which has to adhere to tight regulations on a range of issues from temperature control to security, the cold storage sector has been expanding in a measured way. Americold, the globe’s number one, is extending its coverage in strategic locations such as the port of Maine. Lineage Logistics, for instance, the world’s second largest cold storage player has been growing by acquisition but, so far, only in the U.S.

The technicalities of cold storage are complicated but the rationale behind the growth is simple. Take the humble tomato: produced and consumed in all five continents, its combined export value hit US$9 billion in 2015 but a fresh one lasts just a week in peak condition outside a fridge.

This article was originally published on JLL Real Views.

Global Corporate Real Estate Trend #4: Outsourcing

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Global-Corporate-Real-Estate-Trends-Survey-2015We wrap up the Global Corporate Real Estate Report series with the introduction of Theme 4: Outsourcing.

CRE teams are using outsourced service providers across more geographies and industry sectors; but many are still missing the opportunity to drive strategic, long-term value through outsourcing partnerships.

Given the intense pressure to deliver across a range of tactical and strategic tasks, it is

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Sharing expertise globally

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Charles Doyle, JLL’s global Chief Marketing and Communications Officer discusses the transformation and globalization of the JLL brand.

9-10-15_CharlesDoyleIn the article written for Professional Marketing magazine, Charles Doyle discusses the JLL name shortening last year and the influence of the global market in the decision. Doyle specifically nods to China, a country which is quickly on its way to becoming the world’s largest economy and property market. “The… Read More

Global Corporate Real Estate Trend #3: Expectation

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Global-Corporate-Real-Estate-Trends-Survey-2015The third article in our Global Corporate Real Estate Trend series, we introduce Theme #3: Expectation.

Demand to deliver across a range of tactical and strategic activity continues to intensify, challenging the composition and skills of CRE teams and creating a ‘pressure cooker’ of expectations.

A central theme of our 2013 report was the sheer weight of demand on CRE teams

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Global Corporate Real Estate Trend #2: Integration

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Global-Corporate-Real-Estate-Trends-Survey-2015Last week, we introduced the first of four themes from the 2015 JLL Global Corporate Real Estate Report. This week, we introduce Theme 2: Integration.

Interaction and integration with other business functions and stakeholders is a growing need, but it is a strong feature of only a few CRE teams.

While there is strong intent to transform the structure of CRE teams, these teams do not,

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Global Corporate Real Estate Trend #1: Centralization

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Global-Corporate-Real-Estate-Trends-Survey-2015Over the last six years, JLL has captured the voice of the corporate real estate (CRE) community, including 540 CRE executives from more than 350 companies and 36 countries, to provide powerful insights into the current status and future direction of the industry.

The findings from our 2015 report are summarized into four themes: 1. Centralization, 2. Integration, 3. Expectation and 4. Outsourcing. We expand upon Theme 1 in this article.

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The impact of foreign investment on the U.S. Skyline

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The skylines of the U.S.’ great gateway cities have always been a welcome sight to those looking to make their mark in the land of opportunity.

And although they’ve evolved over the years, these skylines still have a special draw for investors looking for a good home for their money.

Foreign investors now represent two of every five dollars invested in U.S. Skyline property, according to JLL’s recently released 2015 Digital Skyline. Those cross-border dollars… Read More

How well do you know the World’s largest cities? [QUIZ]

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Our Cities Research Center, underpinned by 10 years of pioneering city research, brings together our firm-wide resources and expertise on cities around the world to help you identify new opportunities and to navigate through the New World of Cities.

The crucial questions of when and where to invest, to develop, to locate are the same, but the trends and events impacting the answers are increasingly different. We believe that real estate is a driver of… Read More

Celebrating our 8th Consecutive Year as One of the World’s Most Ethical Companies

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World's Most Ethical Companies 2015For the eighth consecutive year, JLL (NYSE: JLL) has been named a 2015 “World’s Most Ethical Company® by The Ethisphere Institute, the global leader in defining and advancing the standards of ethical business practices.

Eight straight years as one of the ‘World’s Most Ethical Companies’ confirms the value we place

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