Case Study Description of LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies
Set in 2003, this case presents the relative merits and demerits of direct and indirect methods of international property investment from the perspective of an Australian property company, LandLease (Asia) Property Ltd. (LL). It wished to gain exposure to the Hong Kong property sector and had the option of investing directly by acquiring real property assets or indirectly by acquiring interests in investment vehicles whose underlying investment performance was linked to the property sectors. LL was particularly interested in creating an investment portfolio and listing it as a REIT in Hong Kong. Compares and contrasts the most common forms and strategies of real estate investment. The relative attractiveness of direct and indirect international property investments will depend on the requirements, objectives, and financial strength of the investors. Despite differences in the underlying asset base and quality, direct and indirect investments are not mutually exclusive.
Swot Analysis of "LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies" written by Frederik Pretorius, Mary Ho includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Property Landlease facing as an external strategic factors. Some of the topics covered in LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies case study are - Strategic Management Strategies, International business and Finance & Accounting.
Some of the macro environment factors that can be used to understand the LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies casestudy better are - – there is increasing trade war between United States & China, talent flight as more people leaving formal jobs, banking and financial system is disrupted by Bitcoin and other crypto currencies, digital marketing is dominated by two big players Facebook and Google, increasing energy prices, increasing transportation and logistics costs, increasing household debt because of falling income levels,
central banks are concerned over increasing inflation, there is backlash against globalization, etc
Introduction to SWOT Analysis of LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Property Landlease, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Property Landlease operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies can be done for the following purposes –
1. Strategic planning using facts provided in LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies case study
2. Improving business portfolio management of Property Landlease
3. Assessing feasibility of the new initiative in Finance & Accounting field.
4. Making a Finance & Accounting topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Property Landlease
Strengths LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Property Landlease in LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies Harvard Business Review case study are -
High brand equity
– Property Landlease has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Property Landlease to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Low bargaining power of suppliers
– Suppliers of Property Landlease in the sector have low bargaining power. LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Property Landlease to manage not only supply disruptions but also source products at highly competitive prices.
Learning organization
- Property Landlease is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Property Landlease is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Diverse revenue streams
– Property Landlease is present in almost all the verticals within the industry. This has provided firm in LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Operational resilience
– The operational resilience strategy in the LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Sustainable margins compare to other players in Finance & Accounting industry
– LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies firm has clearly differentiated products in the market place. This has enabled Property Landlease to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Property Landlease to invest into research and development (R&D) and innovation.
Highly skilled collaborators
– Property Landlease has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Analytics focus
– Property Landlease is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by Frederik Pretorius, Mary Ho can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Ability to recruit top talent
– Property Landlease is one of the leading recruiters in the industry. Managers in the LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
High switching costs
– The high switching costs that Property Landlease has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Innovation driven organization
– Property Landlease is one of the most innovative firm in sector. Manager in LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Strong track record of project management
– Property Landlease is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Weaknesses LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies are -
High bargaining power of channel partners
– Because of the regulatory requirements, Frederik Pretorius, Mary Ho suggests that, Property Landlease is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies, in the dynamic environment Property Landlease has struggled to respond to the nimble upstart competition. Property Landlease has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow decision making process
– As mentioned earlier in the report, Property Landlease has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Property Landlease even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Need for greater diversity
– Property Landlease has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Skills based hiring
– The stress on hiring functional specialists at Property Landlease has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Workers concerns about automation
– As automation is fast increasing in the segment, Property Landlease needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies, is just above the industry average. Property Landlease needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Property Landlease is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Products dominated business model
– Even though Property Landlease has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies should strive to include more intangible value offerings along with its core products and services.
Slow to strategic competitive environment developments
– As LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies HBR case study mentions - Property Landlease takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Aligning sales with marketing
– It come across in the case study LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies can leverage the sales team experience to cultivate customer relationships as Property Landlease is planning to shift buying processes online.
Opportunities LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies are -
Buying journey improvements
– Property Landlease can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Property Landlease is facing challenges because of the dominance of functional experts in the organization. LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Loyalty marketing
– Property Landlease has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Leveraging digital technologies
– Property Landlease can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Creating value in data economy
– The success of analytics program of Property Landlease has opened avenues for new revenue streams for the organization in the industry. This can help Property Landlease to build a more holistic ecosystem as suggested in the LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies case study. Property Landlease can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Property Landlease to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Property Landlease to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Property Landlease to hire the very best people irrespective of their geographical location.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Property Landlease in the consumer business. Now Property Landlease can target international markets with far fewer capital restrictions requirements than the existing system.
Low interest rates
– Even though inflation is raising its head in most developed economies, Property Landlease can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Building a culture of innovation
– managers at Property Landlease can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Finance & Accounting segment.
Using analytics as competitive advantage
– Property Landlease has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Property Landlease to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Finance & Accounting industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Property Landlease can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Property Landlease can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Learning at scale
– Online learning technologies has now opened space for Property Landlease to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Threats LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies are -
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Property Landlease business can come under increasing regulations regarding data privacy, data security, etc.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Property Landlease needs to understand the core reasons impacting the Finance & Accounting industry. This will help it in building a better workplace.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Consumer confidence and its impact on Property Landlease demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
Stagnating economy with rate increase
– Property Landlease can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Property Landlease in the Finance & Accounting sector and impact the bottomline of the organization.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Property Landlease in the Finance & Accounting industry. The Finance & Accounting industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
Technology acceleration in Forth Industrial Revolution
– Property Landlease has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Property Landlease needs to keep up with the evolution of technology in the Finance & Accounting sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Property Landlease with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
High dependence on third party suppliers
– Property Landlease high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Easy access to finance
– Easy access to finance in Finance & Accounting field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Property Landlease can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Environmental challenges
– Property Landlease needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Property Landlease can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
Weighted SWOT Analysis of LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Property Landlease needs to make to build a sustainable competitive advantage.