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Home Advantage?

I s s u e 3 - J u n e 2 0 0 2 G l o b a l I n s i g h t s

The Impact of the World Cup on Real Estate Markets

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Authors

Ben Sanderson

Tokyo

Michelle Webb

Sydney

Roger Hobkinson

London

Global Research Board

Co-chairs

Jacques Gordon

Chicago

Nigel Roberts

London

Members

Timothy Bellman

Hong Kong

Gerald Blundell

London

Rosemary Feenan

London

Robin Goodchild

London

William Maher

Baltimore

Melinda McKay

Chicago

Jane Murray

Sydney

Christof Widmer

Frankfurt

Global Research Business Board

Chair

Lynn Thurber

Chief Executive Officer

LaSalle Investment Management

Members

Peter Barge

Corporate Solutions, Chicago

Tony Horrell

Capital Markets, London

Margaret Kelly

Marketing and Communications, Chicago

Richard McBlaine

Strategic Consulting, Chicago

Craig Williams

Capital Markets, Sydney

www.joneslanglasalle.com

©2002 Jones Lang LaSalle IP, Inc. All rights reserved.

All information contained herein is from sources deemed reliable; however, no representation or warranty is made to the accuracy thereof.

Cover photo courtesy of Yokohama Sports Promotion Corporation.

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GlobalInsights

Executive Summary

1.0 Introduction

2.0 Preparations: Ready for Kick Off

3.0 Economic Impact: Up for the Cup?

4.0 Urban Regeneration: The Legacy After the Final Whistle?

5.0 Real Estate Markets: The World Cup Effect5.1 Hotel Sector

5.2 Retail Sector

5.3 Office Sector

6.0 Implications for Host Countries: The Winner Is?

Home Advantage? The Impact of the World Cup on Real Estate Markets

Contents I s s u e 3 - J u n e 2 0 0 2

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Home Advantage?

The Impact of the World Cup on Real Estate Markets Page 2

Executive Summary

Preparations

On May 31 2002, the 17th FIFA World Cup begins. The

tournament in South Korea and Japan is the first World

Cup to be held in Asia and the first to be jointly hosted.

In South Korea ten new stadia have been built at a total

cost of US$1.5 billion. In Japan a combination of new

and refurbished facilities have cost an estimated US$3

billion. The total investment including additional

infrastructure is estimated to be US$2.5 billion for South

Korea and US$5 billion for Japan. The 2002 World Cup

represents the largest ever capital investment for a

football tournament. It is unlikely to be matched in the

foreseeable future.

Economic Impacts

The host nations hope for a significant economic boost

from the tournament. In South Korea, the South Korea

Development Institute estimates that the direct and

indirect economic benefits will be US$8.8bn—equal to

2.2% of GDP. The Dentsu Institute in Japan forecasts that

the World Cup will boost the economy by approximately

US$26 billion—equivalent to 0.6% of GDP. Although a

modest percentage, it would be striking contribution as

the consensus economic forecast is that the Japanese

economy will contract 1.0% in 2002.

We suspect these forecasts are likely to prove overly

optimistic. It is important to try to separate the World

Cup effect from normal cyclical economic movements

and to take account of the “crowding out” effect on

spending in other parts of the economy. We suspect that

the World Cup will probably have little or no statistically

significant macroeconomic impact on the host nations’

GDP.

Urban Regeneration

Unlike an Olympic Games, the World Cup tournament is

dispersed among a large number of cities. The only

direct real estate legacy in each city will be the actual

stadia. Yet for the first time the organizers hope to use

the World Cup as a catalyst for physical regeneration in a

number of cities.

In isolation, the stadia are unlikely to underpin

regeneration or city repositioning goals. They should be

viewed as part of a combined approach to mixed-use

development and regeneration. Of fundamental

importance is the need for any stadium, arena or cultural

attraction to have a sustainable business model. Only

then will an iconic building be a powerful catalyst for

value creation that over time can be expected to help to

meet regeneration goals.

If successful, this has the potential to have a significant

long-term impact on real estate markets. However, there

is considerable uncertainty regarding the specific and

viable longer-term business operations of many of the

stadia to be used for World Cup 2002. Thus we remain

unconvinced that the mechanisms are yet in place for the

World Cup necessarily to have a widespread and

enduring regeneration effect.

Real Estate Impacts

To the extent that there will be a direct impact on the

real estate markets of host cities, it is likely to be short-

term and mainly concentrated in the hotel sector. In

recent previous host cities, the retail property market

has also shown a cyclical increase in demand and rents

that has generally been at or close to the peak at the time

of the tournament. There has been little or no

discernible effect on the office property markets.

Hotels

Clearly hotel operators can be expected to benefit during

the World Cup through an increase in visitor numbers

and an increase in average daily rates. However, we

suspect visitor numbers will rise by less than the hosts’

own expectations (400,000 extra visitors to South Korea

and 350,000 to Japan). We estimate that hotel operators

could boost their average daily rates by 20% and that

occupancy could rise by around 9% during the month of

June.

The impact is likely to be concentrated. Hotels in Seoul

and Tokyo will gain the most. Visitors will use these

“gateway cities” as a base to travel to and from games

and between the two host countries. Unless there are

complementary activities to keep the visitors in the

secondary locations, the impact on the hotel sector in

these areas will be more modest.


Home Advantage?


Retail

Retailers are hoping for a strong positive impact driven

by international visitors and stronger domestic

consumer confidence and spending. The 2002

organizers estimate that visitor expenditure will be

around US$2,000 per person in South Korea and

US$3,000 per person in Japan. We suspect these

projections will prove overly optimistic.

The greater effect may well be a positive short-term

effect on the retail sector through increases in retail

sales and rises in domestic consumer confidence. The

positive impact will be greater if the performances of the

Korean and Japanese national teams are above

expectations. However if previous tournaments are any

guide, the impact attributable to the hosting of the World

Cup will likely be short-lived.

Offices

In neither host country has any new office space been

built directly as a result of the event. The tournament

has had little or no significant impact on office demand.

Any increase in net absorption ahead of the tournament

from the organizing committees or media companies

was negligible given the scale of the office markets of

Seoul and Tokyo, which are among the largest in the

world.

Beyond 2002

What is the home advantage? World Cup hosts should

not necessarily expect a significant direct economic or

real estate market impact. From the experience of some

previous host cities, there are a number of common

themes:

■ The World Cup is one of the most prestigious events on

the global sporting calendar. A host country is in the

international limelight for many years ahead of the

tournament. But there is unlikely to be a step-change

in its perception as a tourist or business destination

and thus hosts should not anticipate structural

changes in the requirements for hotel, retail or office

space.

■ Many of the economic and real estate market benefits

will come before rather than during or after the event

and these are unlikely to be shared evenly between

host cities, with gateway cities benefiting

disproportionately.

■ The most direct real estate impact is on hotel operators

who can expect a significant boost to hotel occupancy

and room rates during the event.

■ There might be increased retail demand and demand

for retail space ahead of the tournament through

stronger domestic consumer confidence. This will

likely be more notable and persist longer if the host

country is successful in the tournament.

■ To secure and leverage urban regeneration benefits a

host city needs to put in place a long-term viable plan

for its stadium in order to provide a lasting catalyst,

which if successful could lead to a change in the

pattern of land and real estate values in the city.

■ To leverage regeneration benefits, future host countries

need to consider carefully the number and location of

host cities. The choice is between a smaller number

with a more concentrated impact and a larger number

with more diffuse benefits.

So if the home advantage does not lie in economic or

real estate market influences, what is the attraction for

hosts? In an era when global sporting events have

increasingly become dominated by big business and run

as big businesses, perhaps it is a rather old fashioned

one, a sporting one. The host nation or an immediate

neighbor has won nine of the 16 previous tournaments.

The real attraction for hosts appears to be that it

increases the chance of doing well in the tournament.


Home Advantage?


1.0 Introduction

On May 31 2002, the Seoul World Cup Stadium, South

Korea will be the venue for the first match of the 17th

FIFA World Cup. This game marks the start of a month

long football festival culminating in the final on June 30

in Yokohama, Japan.

The 2002 tournament, jointly hosted by South Korea and

Japan is the first World Cup to be held in Asia and the

first ever to be jointly hosted. The FIFA World Cup has

been variously described as the “second largest sporting

event in the world” and “the most popular sporting event

in the world”. The World Cup is one of the most

prestigious events on the global sporting calendar and as

a consequence the 2002 host countries have been in the

international limelight for many years ahead of the

tournament.

Hosting a World Cup in the 21st Century now involves a

potentially huge investment in either the construction or

refurbishment of stadia, the organization of logistics

infrastructures and a sophisticated and comprehensive

security operation. This is in addition to complex

negotiations over sponsorship and media rights with a

myriad of international companies and the difficulties of

organizing the global sale of several million tickets for

the matches themselves.

Given these costly commitments it is possibly surprising

that the competition to host the World Cup is always

fierce and that FIFA’s greatest problem is not

encouraging countries to host the tournament, but

rather, choosing the most suitable from a long and

diverse list of potential hosts. This apparent paradox

occurs because of the widespread perception that

hosting the World Cup both enhances a country’s chance

of winning the tournament and delivers economic, social

and political benefits that far outweigh the host’s costs.

But will the World Cup’s legacy for South Korea and

Japan and be one of economic growth and regeneration

centered around new infrastructure? Will there be

significant boosts to tourism and domestic spending via

the thousands of free-spending football fans visiting

from all over the world? And will there be a significant

short and long-term impact on each nation’s real estate

markets?

In an attempt to answer these questions, Jones Lang

LaSalle’s research teams have undertaken a global

research project into the likely impacts of the World Cup

on the economies and real estate markets of South Korea

and Japan. This paper has been prepared by drawing on

the experiences of the hosts’ of recent previous World

Cups in Italy (1990), United States (1994) and France

(1998) amongst others.

The structure of the report is as follows. In Section Two

we present an overview of the World Cup preparations

and in particular the investment made in new

infrastructure. In Section Three we analyze the potential

economic benefits that accrue to the hosts. In Sections

Four and Five we assess the likely real estate impact of

the World Cup including the possible impact on urban

regeneration and the impact on the hotel, office and

retail sectors. In Section Six we look beyond 2002 and

draw out the implications of our analysis for the hosts of

future World Cups including the 2006 tournament host

nation Germany.

2.0 Preparations: Ready for Kick Off

The FIFA announcement of chosen venue for the 2002

World Cup was made in 1996. Since then the joint host

nations have been actively preparing for kick-off.

In total, 20 stadia will be used, 17 of which are purpose

built new football stadia. In South Korea 10 new stadia

have been built at a total cost of US$1.5 billion. In Japan

a combination of new and refurbished facilities have cost

an estimated US$3 billion. In addition the hosts have

borne the further costs of hosting the tournament such

as new transport infrastructure. Given these additional

costs it is estimated that total investment will be around

US$2.5 billion for South Korea and US$5 billion for

Japan.

By comparison for the 1998 World Cup in France only

one facility was purpose built (the Stade de France) and

total stadium construction was a mere US$500 million.

The hosts of the 2006 World Cup in Germany are

budgeting for stadium costs of no more than US$350

million. The 2002 World Cup represents the largest ever

capital investment in a football tournament and is

unlikely to be matched in the foreseeable future.


Home Advantage?


Figure 1 shows a map of the locations of the World Cup

venues in South Korea and Japan. Distributed

throughout the paper are profiles of host cities.

Figure 1: Locations of 2002 World Cup Host Cities

Profiles of the 2002 World Cup Hosts

Seoul, South Korea

Seoul is the capital city of South Korea and the economicand political heart of the nation. It has a population of over 10million with a highly developed commercial center hostingthe headquarters of a large number of internationalcompanies. Recently, Seoul has hosted numerousinternational events including the Olympic Games in 1988.

Seoul World Cup Stadium has a capacity of 65,000 and wascompleted in December 2001. First World Cup game: France vSenegal, 31 May 2002.

Niigata, Japan

Niigata is located 300 kilometers northwest of Tokyo at themouth of Japan's longest river, the Shinano. The prefecturalcapital of Niigata is Niigata City, which has population ofapproximately 500,000. It has the largest port on the JapanSea coast and serves as a gateway and transportation hubsupporting the prefecture's machinery, textile, chemical, oil-refining and lumber industries.

Niigata Stadium Big Swan has a capacity of 42,700 and wascompleted in March 2001. First World Cup game: Republic ofIreland v Cameroon, 1 June 2002.

Osaka ShizuokaYokohamaSaitama

Ibaraki

Miyagi

Oita

BusanUlsan

Daegu

Sapporo

IncheonSuwon

JeonjuGwangju Kobe

Niigata

Seogwipo

Daejeon

Seoul

CHINA

JAPAN

SOUTH KOREA

NORTH KOREA

RUSSIA

East China Sea

Sea of Japan

North Pacific Ocean


Home Advantage?


3.0 Economic Impact: Up for the Cup?

The 2001 hosts are confident that the huge investment in

facilities will be recouped. In South Korea the South

Korea Development Institute (SKDI) estimate that the

direct and indirect economic benefits such as extra

spending by an estimated 400,000 visitors will create

350,000 jobs and a total economic impact of around

US$8.8bn—equal to 2.2% of GDP. The Dentsu Institute

in Japan has forecast that the Japanese share of World

Cup will generate a combined total of around US$11

billion in direct economic benefits and produce a long-

term boost to the economy of approximately US$26

billion. With the larger GDP in Japan this is equivalent to

an increase in GDP of 0.6%. This would be a remarkable

contribution to GDP when one considers that Japanese

economic growth has averaged around 1.1% per year for

much of the 1990s and the latest consensus economic

growth forecast for 2002 is that the Japanese economy

will contract by 1.0%. A prominent expert on the

economic impact of sporting events commented that the

SKDI and Dentsu predictions “represent an enormous

boost from the playing of 32 football matches”.1

A closer examination of these estimates indicates that

they are likely to be optimistic. A fundamental criticism

is that the estimates from Dentsu and the SKDI make no

allowance for any offsetting effects of the World Cup

elsewhere in the economy. Economists call this the

“crowding out” effect and means that money spent on

the World Cup will probably be diverted from other

forms of expenditure reducing the overall positive

economic boost. For South Korea and Japan it may

mean, for example, investments in World Cup facilities

mean there is less available to invest in other areas of the

countries’ economic infrastructure.

1 Stefan Szymanski (2002) “The economic impact of the World Cup” WorldEconomics, Vol. 3, No. 1, January-March 2002

Rather than examine hosts’ projections it is more

informative to look at history. The chart below plots the

path of GDP for Italy, the United States and France prior

to and after the World Cup. GDP is indexed to a base of

100 two years before the World Cup. Though GDP rose

after the tournament, it is important to separate a World

Cup effect from the normal cyclical movements that

every economy experiences. When the figures below are

compared to long-term averages, the cyclical norms and

equivalent figures for similar economies at the same

stage of the business cycle, the GDP growth rates are no

different from what one would expect. This suggests

there is no statistically significant positive

macroeconomic impact on GDP for World Cup hosts.

Szymanksi concluded that in the year of hosting the

World Cup there was the possibility of a negative

influence on the hosts as World Cup investment is more

than matched by falls in expenditure in other parts of

the economy. An example of this occurred in the 1994

World Cup in the United States. Although 500,000 fans

from around the world attended the six games played at

Stanford Stadium in Palo Alto, the city lost around

US$400,000, largely as a result of the cost of providing

police services. The economists term this “total crowding

out”. If it occurred in Japan and South Korea the

organizers would be more likely to term it a disaster.

Figure 2: Economic Utopia? GDP for World Cup Hosts

Source: OECD

France

U.S.

Italy

98

100

102

104

106

108

110

112

one year postWorld Cup yearone year priortwo years prior

GDP (indexed to 100 two years prior to World Cup)


Home Advantage?


4.0 Urban Regeneration: The LegacyAfter the Final Whistle?

The South Korean organizers expect the regeneration

impact of the World Cup to be significant. In the

summary document which outlines their expectations of

the World Cup they state that the new stadia will act as a

magnet for investment and regeneration in the 10 host

cities. They expect the stadia “to become tourist

attractions in their own right, not only for their facilities

but also as outstanding works and original works of

architecture”2. The organizers state that the various

stadia will be re-developed after the World Cup

tournament to include multi-media cinemas, swimming

pools, restaurants, hypermarkets and sporting goods

outlets. Similar hopes have been expressed by both the

Japanese organizers and local governments who bid

keenly in a series of domestic competitions for the right

to host matches.

The possibility of urban regeneration is potentially the

most significant and long lasting impact of the World

Cup for real estate markets. In hoping that the World Cup

will provide regeneration benefits across a number of

cities the 2002 organizers are, to a large extent, treading

new ground. This is in contrast to Olympic hosts who

have often attempted to use the games as a catalyst for

regeneration.3 However in isolation iconic buildings

such as World Cup stadia are unlikely to underpin urban

regeneration or city repositioning goals and will be

successful only as part of a combined approach to

mixed-use development.

For World Cup hosts effective urban regeneration

requires an appreciation of the urban and economic

context that the stadia is located within. Demand

drivers, transports links and the competitive context of

the location also need evaluating before the nature of the

real estate required to promote urban regeneration can

be finalized. The new developments must also have

credible, sustainable and deliverable business models.

For World Cup hosts the urban regeneration business

model must be complementary to what is usually the

main purpose of the site as a football stadium. All these

elements appear to have been successfully considered in

the regeneration initiative attempted in Paris

(see Figure 3 case study) after the 1998 World Cup.

2 Korean World Cup Organizing Committee, April, 2002.3 Global Insights (2001) “Reaching Beyond the Gold” from Jones Lang LaSalle,for an in depth summary.


Sapporo, Japan

Sapporo is the capital of the island of Hokkaido, positionedbetween the ocean and the mountains at the north of theJapanese archipelago. Sapporo was established only 130years ago but its current population of 1.8 million makes itJapan's fifth largest city, and the focal point of the politicsand economy of Hokkaido island.

Sapporo Dome has a capacity of 42,122 and was completedin May 2001. First World Cup game: Germany v Saudi Arabia,1 June 2002.

Ulsan, South Korea

Ulsan is located in south eastern Korea and has a populationof over a million. It was the first Korean city to develop anindustrial base and has been the nation’s industrial capital ofKorea since the 1960s. Ulsan now accounts for over 12% oftotal national output and is the home of the HyundaiCompany whose businesses include oil refining,petrochemicals, shipbuilding and machinery.

Ulsan Munsu Football Stadium has a capacity of 45,000 andwas completed in May 2001. First World Cup game: Uruguayv Denmark, 1 June 2002.


Home Advantage?


Despite the positive example from the last World Cup,

our research suggests it is unlikely that the long-term

regeneration impact on the 2002 hosts will be

significant. The 2002 tournament is spread widely

between two nations and over 20 host cities—the largest

number of different locations ever used for the World

Cup. This means most cities host a maximum of three or

four matches and there is no concentrated impact on any

one city for the month of the World Cup. At the end of

the tournament there is no specific real estate legacy

other than the actual stadium. This is a contrast to the

Olympic Games where the impact on one location is

more intense as illustrated by the example of Stadium

Australia (see Figure 4 case study).

In general the 2002 World Cup has avoided venues in

major cities. For instance, the largest Japanese cities to

host any games are Osaka and Yokohama with no games

held in Tokyo. Though Seoul is being used as the

centerpiece of the event in South Korea, a number of

smaller locations will also host matches. It is these

smaller, less economically developed areas that are

hoping for the biggest regeneration boost but we suspect

may be the most disappointed.

In general, in South Korea and Japan the new facilities

appear to show a lack of sustainable viable business

plans for post-World Cup use. There are a large number

of unspecific broad plans such as the “multi-purpose

cultural center” planned for the Suwon World Cup

Stadium in South Korea. Comparing these plans to the

key factors necessary for successful regeneration we

suspect that key issues such as the urban and economic

context, demand forces and the competitive context for

the city have been neglected.

A notable exception to this appears to be in Saitima in

Japan where the Saitama Stadium 2002 will form part of

a new urban development project called the Saitima New

Urban Center covering a total area of nearly 50 hectares

and including the cities of Urawa, Omiya and Yono. The

project aims to create a new urban zone with a surface

area of 1.8 million square meters providing potential

employment for around 60,000 people. The urban

context appears to have been fully considered as the

proposed development (located 24 kilometers north of

Tokyo) will play an important role in the reorganization

of the Greater Tokyo metropolitan area and is aimed at

helping alleviate problems caused by an excessive

concentration of urban facilities in the central district of

the national capital. A new express highway and a brand

new railway station are being built to provide efficient

access to the new urban center.

In summary, stadia and arenas can help in urban

regeneration projects if they have a sustainable business

operation. There are many examples from around the

world of where this has been the case. At Saitima in

Japan a similarly successful regeneration project could

be about to commence. However, in general, the new and

refurbished stadia spread over the World Cup locations

in South Korea and Japan appear to show an absence of

specific and viable longer-term business operations. We

consequently remain unconvinced that the mechanisms

are yet in place for the World Cup necessarily to have a

significant regeneration effect in the majority of the

2002 host cities.

Figure 3: Regeneration Case Study 1:Stade de France, St Denis Paris

The only significant example of the World Cup being used as a catalystfor regeneration is the Stade de France in St Denis, Paris developed aspart of the 1998 tournament.

The aim of the new stadia was to help breathe new life into a tradi-tional industrial and increasingly rundown suburb of northern Paris. TheStade de France is now the home of the French national football andrugby teams and also provides one of Europe’s largest athletics venues.In addition to the headline grabbing sports events, a variety of one offevents combined with ancillary leisure, retail and business facilitieshave added to the vitality of the area.

In tandem with the development of metro and RER rail links, the Stadede France has helped to reposition St Denis for the 21st century. Theimproved environment and vitality of the area has seen St Denis start toregister as a significant suburban office location, with a major increasein the development pipeline of space.


Home Advantage?


Figure 4: Regeneration Case Study 2:Stadium Australia, Homebush, Sydney

Developed on the site of a former munitions facility, brick works andabattoir the Homebush area now boasts one of the largest and bestserviced residential communities in Sydney. Located 12 kilometers fromSydney, Stadium Australia was the centerpiece of the 2000 Olympics.The master-plan for the 40 hectare site not only included the stadiumand associated facilities but provision of 1,200 residential units andassociated retail, leisure and community facilities to cater for an even-tual population of over 5,000.

Since the Olympic Games, Stadium Australia has been remodeled with areduced capacity but with the ability to accommodate a broader rangeof sports and one off events including Rugby League and Union,Australian Rules Football, Soccer, Cricket and American Football.


Saitama, Japan

Saitama Prefecture is on the northern fringe of the greaterTokyo metropolitan area and is commercial center with avaried economic base. Urawa is the capital of SaitamaPrefecture and is 24 kilometers north of Tokyo. Saitama iscurrently promoting a new urban development project calledthe Saitama New Urban Center, covering a total area ofnearly 50 hectares and including the cities of Urawa, Omiyaand Yono based around the new stadium.

Saitama Stadium 2002 has a capacity of 63,700. It wascompleted in July 2001. First World Cup game: England vSweden, 2 June 2002.

Ibaraki, Japan

Ibaraki is located one-hour north-east of Tokyo and is acenter of Japanese scientific research and development. Thefocus of which is Tsukuba Science City, home to over 40universities and cutting-edge research institutions. Ibaraki'scapital city is Mito, a commercial city with a population of240,000 which is a leading industrial and manufacturingcenter for Japanese enterprise.

The Ibaraki Kashima Stadium has a capacity of 42,000seats and was completed in May 2001. First World Cup game:Argentina v Nigeria, 2 June 2002.


Home Advantage?


5.0 Real Estate Markets: The World Cup Effect

The physical legacy of stadia and their associated

developments represent the fundamental long-term

impact of the World Cup. As outlined in Section Four, the

2002 hosts hope that these stadia will act as catalysts for

urban regeneration in South Korea and Japan.

However in the short term the World Cup may have an

impact on other real estate sectors. Through an

examination of the experience of previous hosts we have

assessed the likely short-term impacts of the World Cup

on real estate markets. We have also compared and

contrasted this with the short-term real estate impacts of

the Olympic Games.

The World Cup has had a contrasting effect on the

different real estate markets and is illustrated in broad

terms by the Jones Lang LaSalle property clocks for key

markets during the year in which their country hosted

the World Cup. The property clocks reflect the position

that each city is in its property cycle. The cities chosen to

represent World Cup hosts were: Milan (1990), Los

Angeles and New York (1994) and Paris (1998) as well as

the capital cites of the 2002 hosts. For the Olympics the

host cities of the last four games are illustrated: Seoul

(1988), Barcelona (1992), Atlanta (1996) and Sydney

(2000).

In the hotels sector all four cities were in the upturn

phase of their cycle during World Cup year and the

positive effect of the World Cup pushed them into a more

advanced stage position for the year after the World Cup.

The results in Figures 5 and 6 show a similarity to the

position of Olympic host cities during the year of the

games reflecting the boost to occupancy, room rates and

revenue for hotel operators. The closer bunching of host

cities on the property clock represents the more

concentrated impact of the Olympics. Seoul appears to

be following the pattern of previous hosts currently in a

late upturn phase. However the structural changes

currently impacting on the Japanese economy and real

estate sector mean that Tokyo remains in late downturn.

The retail market cycles shows that in World Cup years

host cities, including Seoul in 2002, appear to be near the

end of the cycle with rental growth possibly about to fall

(as it did in France and Milan) after the World Cup.

However the retail effect is not as clear for World Cup

hosts as it appears for the Olympic hosts with a much

EarlyUpturn

LateDownturn

LateUpturn

EarlyDownturn

TokyoNew York

Milan

Paris

Seoul

Los Angeles

EarlyUpturn

LateDownturn

LateUpturn

EarlyDownturn

Tokyo

New York

Milan

Paris

Seoul

Los Angeles

Figure 5: Property Cycle in World Cup Year for Host Cities

Office World Cup Hosts

Retail World Cup Hosts

EarlyUpturn

LateDownturn

LateUpturn

EarlyDownturn

Tokyo

New York

Milan

Paris

Seoul

Los Angeles

Hotels World Cup Hosts

Source: Jones Lang LaSalle


Home Advantage?



Busan, South Korea

Busan is South Korea’s second largest city and is located onthe southeast coast of the Korean Peninsula. With apopulation of four million, Busan has developed into anadvanced and competitive international port city. A new portis currently under development in west Busan, which isexpected to play a pivotal role in north Asian maritime trade.

Busan Asiad Main Stadium has a capacity of 56,000 andwas completed in May 2001. First World Cup game: Paraguayv South Africa, 2 June 2002.

Gwangju, South Korea

Gwangju is located in the southern part of the Koreanpeninsula and is South Korea's fifth largest city with apopulation of 1.4 million. There is a long tradition of the artsin the city with a less developed commercial sector. Thisartistic tradition has most recently been maintained with theinternationally acclaimed Gwangju Biennale arts festival.

Gwangju World Cup Stadium was completed in September2001 and has a capacity of 43,000 spectators. First World Cupgame: Slovenia v Spain, 2 June 2002.

EarlyUpturn

LateDownturn

LateUpturn

EarlyDownturn

Sydney

Atlanta

Seoul

Barcelona

EarlyUpturn

LateDownturn

LateUpturn

EarlyDownturn

Barcelona Sydney

AtlantaSeoul

Figure 6: Property Cycle in Olympic Year for Host Cities

Office Olympic Hosts

Retail Olympic Hosts

EarlyUpturn

LateDownturn

LateUpturn

EarlyDownturnSydney

AtlantaSeoul

Barcelona

Hotels Olympic Hosts

Source: Jones Lang LaSalle


Home Advantage?


closer bunching of cities at the “top of the cycle”. Tokyo

is again in a different position to previous hosts due to

sluggish economic growth and structural change in the

retail sector.

For the office sector the position of World Cup host

cities in their cycles during the year of the tournament is

much more varied suggesting that the World Cup is not

the over-riding factor affecting the office sector. This is

also true of the office clocks for Olympic hosts.

Below we analyze the impact of the World Cup on real

estate sectors in more depth.

5.1 Hotel Sector

i. Visitors

The Japanese organizers are hoping that visitor numbers

will rise by 350,000 due to the World Cup. In South Korea

the figure is 400,000. When compared to the growth in

visitors to each country over the last two years, these

predictions appear bold.

During 2000, international arrivals to Japan grew by

7.2% and by 14.2% to South Korea. However, during

2001, the global economic slowdown and the impact of

September 11th adversely affected tourism across the

world. Visitors to Japan increased by 13,000 (0.3%), but

visitors to South Korea fell by 174,604 (-3.3%) resulting

in a total of 4.8 million visitors in Japan and 5.3 million

visitors in South Korea. The growth in visitor numbers to

South Korea and Japan is shown below (indexed to 100

in 1995) and clearly shows the growth in visitors to

North Asia was part of a global trend in increased

tourism as was the slowdown in 2001.

Figure 7: Destination Asia: Visitor Numbers toSouth Korea and Japan Compared to Global Levels

Source: National Tourism Offices

Assuming the natural trend growth in visitors is an

average of the past five years, in 2002 visitors to Japan

would increase by 4.6% or 218,000 and to South Korea

by 9.0% or 464,000. However given the significant

tourism slowdown brought about by the twin effects of

economic uncertainty and security fears, a figure of

around half this level appears a more realistic proxy for

the natural growth trend which excludes the impact of

the World Cup. This would make “normal” visitor growth

equal to around 109,000 for Japan and 232,000 for South

Korea.

Placing the organizers’ estimations into context, this

means that in Japan the World Cup is expected to attract

additional visitors, which are three times greater than

our proxy for trend growth for the whole year. In South

Korea, the organizers estimate the World Cup’s impact to

be 1.7 times our projection of “normal” annual visitor

growth. This is a bold, and we suspect unrealistic,

prediction for the 32 World Cup football games. Based on

the number of matches in each country, the official

estimates require 25,000 new overseas arrivals for every

match in South Korea and nearly 22,000 per match in

Japan.

Evidence so far certainly supports the idea that World

Cup visitor numbers may be disappointing. In the run-

up to the 2002 tournament ticket sales have been strong

in Japan, but in South Korea sales appear to have been

poor. For example when the FIFA website opened on 1

May 2002 for “last minute ticket sales” no tickets were

available for matches in Japan. However, tickets were

available for every match in South Korea except those

involving South Korea and China. In April FIFA’s official

travel agent made last minute cancellations of hundreds

of hotel rooms in Japan and South Korea that had been

block booked for expected visitors. Official figures were

never made public but the cancellations were widely

reported to have been greater in South Korea. This

suggests that the visitors are choosing Japan over South

Korea for their World Cup visit and implies that the

predictions of 350,000 visitors to Japan and 400,000

visitors to South Korea are likely to be overly optimistic.Global Tourism

Japan

South Korea

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Visitor Numbers (indexed to 100 in 1995)


Home Advantage?


ii. Hotel Operators

We have examined the experience of hotel operators in

major cities in France, the United States and Italy before,

during and after previous World Cup tournaments and

collated figures on occupancy, average daily room rates

(ADR) and revenue per available room (RevPAR). The

graph below demonstrates a sample of our findings and

shows that although occupancy increased the largest

impact was felt in terms of room rates. During the two

months of the World Cup, occupancy increased by an

average of 8.7%, ADR rose by 20.2% and RevPAR rose by

revenue by 30.6%.

Figure 8: Happy Hoteliers: Growth in Key AggregatesDuring Two Months of World Cup

Source: Jones Lang LaSalle Hotels

Our research suggests that some hotel operators may not

have taken full advantage of the demand peaks in 1994

and higher average revenues could have been achieved.

This anecdotal evidence is supported by the superior

performance of Paris where average revenue increases

were the highest we have observed.

Anecdotal evidence also suggests that some demand was

displaced during and immediately surrounding the Word

Cup in Paris as other travelers avoided the city. However,

this demand was recovered during the month following

the event. Displaced demand from corporate and

convention markets may be particularly evident when

football events are held due to the negative image of

football crowds and fears over hooliganism.

Though not comparable to the World Cup in terms of

size, the European Championship football tournament

jointly hosted by Belgium and the Netherlands in 2000

presents an interesting parallel to the 2002 World Cup, as


Kobe, Japan

Kobe is located in western Japan approximately 3 hours and20 minutes from Tokyo by bullet train. It has a population of1.5 million and together with Osaka and Kyoto, forms theeconomic focal point of Kansai, western Japan. Kobe is oneof the world's leading international trading ports and hasbeen a significant transport hub for Japanese trade since the8th century.

The Kobe Wing Stadium has a capacity of 42,000 and wascompleted in October 2001. First World Cup game: Russia vTunisia, 6 June 2002.

Suwon, South Korea

Suwon is located one hour south of Seoul has a populationof 930,000. It is at the forefront of Korea's technological andeconomic development and is the countries leading city indigital technology. Swoon is also an historical city with along cultural tradition It is the site of the Hwaseong fortressdesignated as World Cultural site by UNESCO.

Suwon World Cup Stadium was completed in May 2001 andhas a capacity of 44,000. First World Cup game: USA vPortugal, 5 June 2002.

0%

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ADR

Occupancy

New YorkLos AngelesParis

Change over previous year


Home Advantage?


it was the first major football tournament to be jointly

hosted. The consequent increases in inter-country travel

by supporters lead to a boost for hotel operators in

gateway cities. Supporters would gather in, for example

Brussels and Amsterdam, regardless of where matches

were being played which meant these locations were

busier than normal for the duration of the tournament.

For South Korea and Japan this suggests that hotels in

Seoul and Tokyo or Yokohama will be busier than

normal. We suspect that visitors will use these

“gateways” as a base camp especially when one considers

that they are the most international cities in the two

countries and the least likely to present visitors with

insurmountable cultural and language difficulties. They

also have the most developed hotel infrastructure.

We suspect that the impact on the hotel sector outside of

these major cities is not likely to last beyond match day,

not least because of a lack of rooms. In many of the host

cites the capacity of the football stadia is over twice as

large as the number of available hotel rooms. There is

the possibility that some of the host cities may benefit

from the international exposure that the World Cup

brings and be assisted in their development as tourist

destinations. However in this aim South Korea and Japan

have more fundamental issues to contend with such as

the higher costs associated with a visit to either country

compared to other parts of Asia and the general

concerns about security that are causing global tourism

numbers to fall.

5.2 Retail Sector

It is an oft-used cliché that football is no longer a sport

but is now a business. Nowhere is the metamorphosis of

a sporting pastime into a powerful commercial entity

more apparent than in the retail sector and the number

of products being marketed in connection with the 2002

World Cup. Retailers are hoping for a spending bonanza

driven by domestic and international spending on food

and drink, and hope to capitalize on the desire to be

connected to the World Cup, via souvenirs and

merchandise.

Clearly the impact on the retail sector is tied in with the

overall economic impact, which as explained above, we

expect to be relatively muted. However, as football is

growing in popularity amongst the key retail

demographic grouping (18 to 35 year olds) in South

Korea and Japan, a boost to retail sales is possible.

Certainly there will be no shortage of opportunities.

In both countries a number of specialist stores are

opening for the summer selling a range of around 500 of

the 5,000 different officially licensed World Cup

merchandise. In total 12 stores are expected to open in

Japan with a similar number in South Korea. Though the

floor space they will be occupying in most locations is

relatively small, World Cup merchandise concessions will

also be a feature of all the major department stores.

Everything from official snack foods to soft drinks will

be available and for the first time the 2002 World Cup

will even have an “official World Cup sake” provided by a

leading Japanese drinks company.

The availability of World Cup merchandise does not

necessarily equal increased spending overall.

Merchandise and souvenirs will make up a very small

proportion of the anticipated retail spend of the average

World Cup supporter. The 2002 organizers are again

bold, estimating that visitor expenditure will be around

$2,000 per person in South Korea and $3,000 per person

in Japan.

We have examined the experiences of Italy, the United

States and France during previous tournaments and

collated evidence on overall retail sales and consumer

confidence. Our research suggests that in 1990, 1994 and

1998 there was a small positive impact of the

tournament on aggregate retail sales. The most positive

effect we discovered was in France and is illustrated

below.

The 1998 World Cup occurred in June and July and the

graph below shows that that seasonally adjusted retail

sales appeared to rise in the third quarter as the nation

celebrated its’ first ever World Cup win. However the

growth was only a 2.3% increase on the quarter before

compared to trend/average growth of around 1% per

quarter. It is also likely that the World Cup effect brought

forward expenditure rather than increasing it as a whole

as retail sales fell in the fourth quarter of 1998 and total

annual retail sales were barely changed from 1997.


Home Advantage?


Figure 9: Where’s the bounce? French Retail Sales 1997 to 2000

Source: OECD

One of the reasons for the apparently limited impact on

retail sales is consumers’ resistance to the World Cup

“feel-good-factor”. The 2002 organizers hope the World

Cup will have a similar positive impact on their

respective nation’s economic confidence as the 1998

tournament had on French consumers. However on

closer inspection the World Cup effect in 1998, though

positive, appears to be fairly benign.

The monthly changes in consumer confidence during

World Cup year for the last three hosts are shown below.

In France and the United States consumer confidence

rose by 4 points during the month within which the

majority of the World Cup matches were held. In Italy

consumer confidence fell by 2 points. Football fans may

suggest that this was due to the disappointment of Italy’s

exit at the semi-final stage.

A more likely rationale is that Italian consumers were in

the middle of the largest European wide recession since

the 1930s and in the face of rising unemployment and

falling real incomes were not optimistic about the future.

Similarly the four point rises in confidence in France

and the United States (possibly) due to the World Cup

are significantly lower than the sharpest monthly rises in

confidence seen in recent times. For both countries this

occurred in the month that the Gulf War ended. Clearly

non-economic, external events can have some impact on

confidence but an event such as the World Cup needs to

be placed in context.

Our research suggests that for the hosts the World Cup

causes a positive, though small, boost to the retail sector

through increases in retail sales and rises in domestic

confidence. This may be connected to the performance


Daegu, South Korea

Daegu is a located in eastern Korea and has a population ofover 2.5 million. It is Korea’s leading industrial base fortextiles and fashions. The city is currently working toestablish itself as one of Asia’s top fashion centers andhopes to compete internationally in the next five years.

Daegu World Cup Stadium has a capacity of 65,000 and wascompleted in May 2001. First World Cup game: Denmark vSenegal, 6 June 2002.

Jeonju, South Korea

Jeonju is a small city of around 500,000 people situated inthe southwestern part of the Korean peninsula. It is a citythat attracts tourists rather than commerce with attractionssuch as the country's biggest Korean-style house village,with over 800 households. The city is also famous for itsBibimbap, which along with Pyongyang's iced noodles andGaesung's rice and broth features as one of Korea's topthree most popular foods.

Jeonju World Cup Stadium was completed in September2001 and has a capacity of 42,000 spectators. First World Cupgame: Spain v Paraguay, 7 June 2002.

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World Cup


Home Advantage?


of the national teams as the longer the host teams

remain in the tournament the greater the possibility of

generating some economic or spending momentum. In

France and the United States where confidence rose

during the tournament it was noticeable that the host

nation’s performances were above expectations. But care

should be taken with this interpretation as the example

of Italy shows that wider economic forces are more

powerful influences on a nations confidence than

football.

To draw out implications of the World Cup for the retail

sectors in South Korea and Japan a distinction needs to

be made between domestic and visitor spending. We

expect international visitors to both countries to be

below projections and estimations of total spending

from each visitor appear bold when compared to the

projections being used by the German organizers of the

2006 World Cup (US$500 per visitor). Despite the

notoriously higher costs in South Korea and Japan

estimations of spending four times higher than Germany

seem unrealistic and probably unachievable. But even if

these bold estimates of expenditure per visitor were

true, the majority of this is likely to be directed towards

international airlines and hotel chains rather than

towards domestic retailers. A few hundred thousand

free-spending visitors will barely register when it comes

to aggregate national retail sales.

Thus we conclude that it is domestic consumers who will

need to provide a significant boost for the retail sector.

However it appears that in South Korea any boost for

retailers may be inhibited by the same forces that have

slowed ticket sales: South Korea is a relatively low

income country with disposable incomes significantly

lower than Japan and many consumers simply cannot

afford the prices charged by World Cup organizers for

tickets and merchandise.

In Japan despite football’s growing fashionability

amongst the young, football still falls well behind

baseball in overall popularity. For example, Seattle

Mariners baseball player Ichiro Suzuki is a more

significant style icon and role model than any of Japan’s

leading football players. Moreover given the size of

Japan’s population the World Cup tournament is unlikely

to directly impact on even a significant minority of

Japanese citizens.

Despite current economic woes the Japanese are still

wealthy, but rather than spending their wealth, they lead

the world in savings. Fundamental concerns about the

future (deflation, unemployment etc) have prevented

spending from rising despite the best efforts of

governments over many years. Faced with this evidence

and that from previous tournaments, we conclude that

though the impact on the retail sector from the World

Cup is likely to be positive, it is also likely to be relatively

weak.

Figure 10: We love football?Consumer Confidence Changes in World Cup Year

Source: OECD

5.3 Office Sector

If used effectively the World Cup can be a major

promotional tool for the hosts, showcasing their nation’s

talents, skills and abilities and bringing about a change

in perceptions. Domestic companies who are FIFA World

Cup partners such as the Hyundai Motor Company and

Korea Telecom in South Korea certainly anticipate

substantial tangible benefits and an increase in their

international brand status. Similar hopes are being

expressed in Japan where exporters of typically

“Japanese” products such as sake and are hoping that

international markets will open up as a consequence of

the World Cup spotlight.

If this were the result then it is possible to envisage an

indirect World Cup impact on the office markets of Japan

and South Korea as employment growth contributes to

rising office demand. However our analysis of the

economic impact of the World Cup suggests that this

scenario is unlikely. Furthermore our examination of

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France U.S. Italy


Home Advantage?


rental levels and the rental cycle in the major office

markets of previous host countries during World Cup

year suggests that the tournament had no discernable

effect. Any increases in net absorption ahead of the

tournament from the organizing committees or media

companies was negligible given the scale of the office

markets of Tokyo and Seoul, which are among the largest

in the world.

Moreover in both of the 2002 host countries the

substantial capital investment in facilities does not

include any new office developments that are either

associated with or connected to any of the new stadia.

This is a contrast to Stade de France, host of the World

Cup final in 1998, which is now being used as a

centerpiece for the growth of an office market intended

to rival La Defence, Paris’s current leading out-of-town

office market. On the eve of the 2002 tournament, no

major office developments are being built or planned.

We therefore conclude that the impact of the World Cup

on the office markets of South Korea and Japan, if any,

will be muted. Clearly office demand, supply, pricing and

investment are driven by a combination of long and

short term economic and social factors which are

unlikely to be affected by a mere football tournament.

Office workers may well enjoy the World Cup, but our

research suggests that the offices they inhabit will be

unaffected by the events of June 2002.


Seogwipo, South Korea

Seogwipo is located on the country's largest island, Jeju-do,at the southern tip of the Korean Peninsula. The island has apopulation of only 85,000. Seogwipo attracts thousands ofhoneymoon couples every year and has an economy basedaround tourism. Jeju-do has also been developed as aconference venue and has hosted high level summitsbetween Korean and foreign national leaders.

Jeju World Cup Stadium was completed in December 2001and has a capacity of 42,000. First World Cup game: Brazil vChina, 8 June 2002.

Miyagi, Japan

Miyagi Prefecture is located 300 kilometers northeast ofTokyo in the central part of the Tohoku region. The capital ofMiyagi is Sendai, which has a population close to one millionand is the political and economic heart of the region. Miyagiis one of Japan’s major agricultural producers supplying ahigh proportion of the countries rice and beef.

Miyagi Stadium has a capacity of 49,000 and was completedin March 2000. First World Cup game: Mexico v Ecuador, 9June 2002.


Home Advantage?


6.0 Implications for Host Countries:The Winner Is?

The main focus of this paper has been the 2002 World

Cup and the impacts on South Korea and Japan. However

our analysis also has more general implications for

future hosts. As shown in the box below, 2006 will see

the World Cup return to Europe with Germany as the

hosts for the first time since 1974. The 2010 hosts will be

chosen in 2004 with South Africa, Egypt, Morocco, Libya

and possibly China all expected to bid.

In 2006 the German hosts should not expect a significant

and lasting economic boost to their countries as a

consequence of the World Cup. As real estate markets are

driven by economic forces this appears to suggest that

the overall real estate impact will be minimal. However

our research has developed key themes apparent from

the experiences of the hosts of previous tournaments. By

considering these themes the German organizers can

help maximize the positive real estate impacts of the

World Cup (and minimize some of the negative ones).

The key themes are:

■ The World Cup is one of the most prestigious events on

the global sporting calendar which places the host

country in the international limelight for many years

ahead of the tournament. However hosts should not

expect the profile raising impact of the World Cup to

lead to significant increases in visitor numbers or

inward investment. Nor should hosts expect a

fundamental step-change in their perception as either

a tourist or business destination.

■ If the host nation is promoted effectively and

realistically it is possible that the World Cup can be an

effective complement to existing campaigns to attract

business and visitors. However we do not envisage the

World Cup ever leading to significant structural

changes in the requirements for hotel or office space.

Hosts who develop facilities with this in mind should

be wary.

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France

Brazil

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Sweden

Chili

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Mexico

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Spain

Mexico

Italy

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France

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Germany

Figure 11: World Cup History


Home Advantage?


■ The most direct real estate impact will be on hotel

operators who can expect a significant short-term

boost to revenue and occupancy. This boost is likely to

be concentrated on key gateway cities with already

well-developed transport hubs. Hotel operators in

secondary locations can improve their chances of

increased revenue and occupancy by developing

complementary activities to encourage visitors to

remain after the World Cup matches.

■ Retailers are likely to experience a short-term boost

through increased consumer confidence and retail

sales. The anticipation of this could lead to increased

demand for retail space ahead of the tournament.

However the boosts to confidence and retail sales are

likely to be connected to the performance of the

national teams and general economic conditions in the

host nation. No structural changes to the retail sector

are likely through hosting the World Cup.

■ The possibility of urban regeneration is potentially the

most significant long-term real estate impact. To

leverage urban regeneration benefits hosts should

ensure that a clear and viable business plan is in place

before the commencement of the World Cup. This

should ideally involve non-football and other non-

sporting uses. If successful this could lead to a change

in the pattern of land and real estate values in the city.

Future hosts also need to consider carefully the

number and location of host cities. Hosts have a choice

between a smaller number with a more concentrated

impact and a larger number with more diffuse

benefits. It is likely that to maximize the chances of

leveraging regeneration benefits, hosts should

concentrate the tournament in a small number of host

cities that already have large populations and diverse

economies.

So if the home advantage does not lie in economic or

real estate market influences, what is the attraction for

hosts? In an era when global sporting events have

increasingly become dominated by big business and run

as big businesses, perhaps it is a rather old fashioned

one, a sporting one. The host nation or an immediate

neighbor has won nine of the 16 previous tournaments.

The real attraction for hosts and the real home

advantage appears to be that it increases the chances of

doing well in the tournament.


Incheon, South Korea

Incheon is located 28 kilometers west of Seoul and is thenautical gateway to the nation's capital and the nation'ssecond largest port. The city is also a key producer ofautomobiles, steel, furniture and glass. Incheon is linked toneighboring cities by a number of major transportationroutes, as well as a subway connection to Seoul.

Incheon Munhak Stadium has a capacity of 53,000 and wascompleted in December 2001. First World Cup game: CostaRica v Turkey, 9 June 2002.

Yokohama, Japan

Yokohama is Japan's second largest city after Tokyo and isthe center of the Kanagawa Prefecture, which adjoins Tokyo.The city is a major commercial center, which has grown inrecent years as a convention center destination. It isattempting to use the World Cup spotlight to promote itselffurther. Yokohama will host the World Cup final.

International Stadium Yokohama was completed in October1997 and has capacity of 70,000. First World Cup game:Japan v Russia, 9 June 2002.


Home Advantage?



Oita, Japan

Oita Prefecture is situated at the eastern end of the island ofKyushu, at the southern tip of Japan. The island is currentlymainly a tourist destination though international air serviceshave recently commenced at its airport and the prefecture isdeveloping into a gateway for regional and worldwide trade.

Oita Stadium Big Eye has a capacity of 43,000 and wascompleted in March 2001. First World Cup game: Tunisia vBelgium, 10 June 2002.

Shizuoka, Japan

Shizuoka Prefecture is located in the center of Japan and hasa population of 3.8 million making it the tenth largest ofJapan's 47 Prefectures. Shizuoka is the home of Japan'smost famous landmark, Mount Fuji, and is a popular touristdestination rather than a major commercial area.

Shizuoka Stadium Ecopa has a capacity of 51,000 and wascompleted in March 2001. First World Cup game: Cameroon vGermany, 11 June 2002.

Daejeon, South Korea

Daejeon is at the geographical heart of the South Koreanpeninsula 150 kilometers south of Seoul. It is the country'ssecond administrative capital and the nation's center for hightechnology, with approximately 70 leading research labslocated in the Daedok Research Complex earning itself thenickname of Korea's Silicon Valley.

Daejeon World Cup Stadium was completed in September2001 and has a capacity of 42,000. First World Cup game:South Africa v Spain, 12 June 2002.

Osaka, Japan

Osaka is the third largest city in Japan and the main city inthe nation's western half. Located in the geographical heartof the country Osaka is a major commercial center and hometo a large number of international companies

Nagai Stadium has a capacity of 50,000 and was completedin1996. First World Cup game: Nigeria v England, 12 June2002.


Ben SandersonAssociate Director, Asia Pacific Research

Ben Sanderson is currently based in Tokyo working in

the Jones Lang LaSalle research group in Japan and as

part of the research group in the Asia Pacific region. His

responsibilities include primary real estate research,

economic and investment analysis, property forecasts,

input into Jones Lang LaSalle market monitoring

publications, and contributions and commentaries on

issues relating to Japan and North Asia.

Ben is an experienced economist and econometrician,

with more than a decade of business and academic

experience. Prior to working in Tokyo he worked as the

Senior European Economist within the European

Research department of Jones Lang LaSalle based in

London. He was responsible for the leadership of the

team producing economic analysis and forecasting of

European real estate markets as well as economic

briefings, input into investment strategy work and

regular publications, press articles and conference

papers.

Michelle WebbVice President of Marketing and Research, Asia Pacific Research

Michelle Webb is based in Sydney, and is responsible for

the coordination of Jones Lang LaSalle Hotel’s research

for the Australian and New Zealand markets and the

production of the group’s on-line research Digest, the

most comprehensive analysis of the major tourism

markets in Australasia. She also works on consultancy

assignments for key hotel and tourism clients. Since June

2001 her role was extended to take advantage of the

strategic fit between research and marketing and she

assumed responsibility for the regional marketing of

Jones Lang LaSalle Hotels.

Michelle has experience working with the brokerage,

advisory, valuation and research departments of Jones

Lang LaSalle and has worked on projects for government

and leading private organizations. Recent assignments

include a tourism infrastructure study for the Australian

government, an analysis of the accommodation needs for

Sydney and demand and supply forecasting for key

Australian hotel and tourism markets.

Roger HobkinsonSenior Consultant, Strategic Consulting

Roger Hobkinson is based in London working as part of

the Strategic Consulting team, focusing on development

and asset strategy. His role encompasses advice on target

marketing strategies, concept development and property

market analysis to assist in implementing real estate

development strategies. He has provided advice in

relation to large mixed use developments, business

location solutions, major transport facilities, real estate

and city positioning strategies, stadium and iconic

buildings and new real estate concepts. Roger’s expertise

and experience contributed to the section of this paper

concerning urban regeneration.

Roger has worked in the research and consulting area of

the real estate industry for 7 years. Prior to joining the

Strategic Consulting team, he worked in the European

Research group of Jones Lang LaSalle. His role focused

on European market analysis and consulting advice on

property investment strategies across Europe for a range

of international investors.

About the AuthorsThis document was the result of collaboration between Jones Lang LaSalle’s business groups across the world using

the global network of research professionals. The lead authors of this paper were Ben Sanderson, Michelle Webb and

Roger Hobkinson.

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