In the very first edition of Cycles, Trends and Forecasts my colleague Phillip J Anderson made the following comment:
‘The best way to watch how the real estate cycle turns is by watching the key indicators. These are not just any indicators.
‘The secret to this is doing so within the context of the 18 year cycle. The construction of the world’s tallest buildings is one of them. I call this the Cantillon Indicator.’
This indicator has worked for at least 200 years. Here’s the irony of history.
These buildings almost always open in recession.
You might know already the Burj Khalifa in Dubai is currently the world’s tallest building.
It opened in 2010, at the very depth of the global recession after the collapse of 2008.
Another example is the Empire State Building in New York. It opened in the middle of the Great Depression.
The list is long and distinguished.
If you follow our work you’ll know we think the next major top and subsequent collapse is coming around 2025/26.
So we’re always on the lookout for news about tall buildings. You’d be surprised how often they come along.
But even we didn’t expect to see the world’s tallest to show up in the Iraqi desert.
In case you didn’t see the news, Domain reported on the weekend…
‘A twisting skyscraper that towers over the Basra province in Iraq could become the world’s tallest building, if the plans come to fruition…
‘The overarching plan, commissioned by the Basra Governorate, aims to maximise the city’s capacity by 2025 but also to curb urban sprawl, according to AMBS Architects.
‘The architects’ solution was to design what they describe as “the first vertical city in the world”.’
Phil forecast this to happen — not the where, but the why — years ago.
Here’s an impression of what the building will look like:
The Burj Khalifa is 829.8 metres tall.
This building, already dubbed ‘The Bride’, would be 1,152 metres tall if it’s completed.
That’s 323 meters further into the sky.
Granted, it’s not off the drawing board yet. But history says we’d be fools to ignore this development.
Can you see why we’re so bullish on world events?
It staggers me how much development is going on around the world right now.
The Financial Times reported last week that the mayor in London has just given approval to an 8.4 billion pound development in south east London.
That’s 8.4 billion pounds.
1 pound buys $2.10 here.
That’s over $16 billion…being invested by a single developer.
The scale is enormous. It could take 15–20 years to complete.
A downturn is highly unlikely at this point in time.
More importantly, you can time your investment strategy in both property and stocks according to the real estate cycle.
I cannot imagine a bigger advantage over the investment pack.
Find out how to get that here.