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Feast and Famine

Strolling around Cannes on the first night of MIPIM, you could be forgiven for thinking the real-estate boom is still in full swing.

And most of the 30-thousand property players here were on their troisieme biere when news came in of an important move by another sovereign wealth fund into the sector.

Investment Corporation of Dubai has agreed with shareholders of Colonial to a partial takeover of the indebted Spanish property company.

The move underlines two themes at this year's MIPIM: where do the value opportunities lie a year after the credit crunch started to take hold, and who will emerge as the new dominant players?

The sovereign wealth funds have already shown their mettle with high profile investments in financials including Abu Dhabi Investment Authority's capital injection into Citigroup.

And we should expect to see much more of them in real estate, according to Alastair Hughes, CEO of Jones Lang Lasalle for EMEA. But Hughes also points out that while many see the SWFs as the saviors of the global economy they won't buy assets at yesterday's prices.

Pricing is also on the mind of Michael Evans, CEO of Evans Randall.

There has been a surge in redemptions by retail investors spooked by the impact of economic and credit conditions. That has spurred an increase in fire sales by sellers forced to shed assets.

To echo a cliche, one man's feast is another man's famine.

Back in January, Evans Randall set up a $2 billion opportunity fund to buy property from distressed sellers. They've already bought real estate, including an office in London's Mayfair from Standard Life for almost $100 million. And they plan to stay UK-focused, despite concerns from quarters about lingering overpricing.

Speaking to CNBC, Evans pointed out the value investors extract from a property is a function of the price they pay for it and Evans Randall's objective is to buy undervalued property.

Evans makes a good point, but his model still rests on assumptions about the underlying health of the UK property markets and correctly identifying the bottom.

And if James Darkins, MD Property at Henderson GlobalInvestors, is to be believed, there is another wave of revaluation to come in London real estate toward the middle of the year.

But the delegates at MIPIM don't appear to be worrying about that too much at the moment. Despite warnings about more pain to come there are more delegates than ever, bringing bigger yachts and the helipad has been in action non-stop since Monday. Clearly some people are finding that value.