Case Study: CEO Renuka Ramnath's Investment Choice

Case Study: CEO Renuka Ramnath; Flex-space vs. E-commerce in Asia

• Renuka Ramnath, CEO of PIA, was deciding between a USD 30 million investment in a mixed-use development near Tokyo's airport or a tech-oriented building in Hong Kong.
• The Japan investment needed a decision within three weeks, otherwise, the funds would be used for another project.
• PIA's executive committee, composed of various nationalities, had created reports for both locations, covering business, commercial, marketing, technical, legal, and financial aspects.
• JLLvalue.com valuations showed similar returns for both locations.
• Tokyo's investment focused on logistics and industrial space (approximately 70%).
• Hong Kong's investment centered on flex-office and co-working spaces (approximately 70%).
• The investment has equity from Australian fund MJHv Group (25%) and Samurai Capital (25%).
• Both investment boards must approve the decision.

Project in Tokyo

• The project location is near Narita International Airport.
• Companies like Prologis are already established.
• The land is fully entitled, including municipal access and permits.
• Tokyo received significant interest from other international investment funds.
• CBRE IM is operating in the region.

Project in Hong Kong

• The project aims to establish Hong Kong as a tech hub.
• Hong Kong's rising rent costs in office spaces raised doubts about the project's viability.
• Other companies like WeWork and IWG faced challenges, which increased uncertainty.
• Potentially, the Asian operator JustCo could be an investor.
• Potential investors like ShiMao Group and Koramco Real Estate Fund are also interested in the Hong Kong project.
• The area has potential for imminent resurgence as a strategic center in southern China.
• A public-private initiative, Hong Kong's Science Park, was behind the project.

Group Work Methodology and Development

• Students must analyze different investment aspects within groups, presenting their findings to the class.
• Topics include real estate, financial, technical, regulatory, and legal factors.
• Departments like HR, marketing, commercial, sales, risk analysis, etc. can be involved.
• The case study aims to highlight collaboration between departments to create an integrated solution for investors/developers.
• The case study information is fictional, but it could resemble investments in real cities.

Sustainability Metrics and ESG Certifications

• Sustainability metrics and ESG certifications are crucial for investors.
• These offer risk mitigation, compliance assurance, cost reduction, and capital attraction.