GE Annual Report 2000: Business Review: Real Estate




			GE Capital Real Estate Web Site


			This striking addition to the London skyline, 125 London Wall, was part of the MEPC portfolio acquired by GE Capital Real Estate. The building's 386,500 square feet are leased primarily to Chase Manhattan.

GE Capital Real Estate continued its strong financial performance in 2000, achieving net income growth of 24% while maintaining record delinquency rates below 1%. Our success can be attributed to continued focus on global diversification, strategic ventures and the digitization of our core business.

Real estate is a cyclical industry. With a growing organization that invests, lends, manages and services commercial real estate worldwide, being prepared for the unexpected is at the core of every decision we make. Our approach is to focus on quality properties with strong collateral protection and to diversify by geography, product, collateral and borrower.

Global Diversification
About half of our business is generated from outside the United States. While capturing opportunities in still-rising markets, we have positioned ourselves to weather cyclical downturns in other markets. We are invested in Canada, Mexico, Australia, Japan, Korea, Thailand and throughout Europe—and plan to continue to develop platforms in other growth areas.

One big platform for us in 2000 was the acquisition of MEPC, a large U.K. property company with $6.7 billion of assets, in a 50/50 partnership with the Hermes Group, a U.K. pension fund manager.

In Japan, we built an asset management business with approximately $1 billion under management, positioning us to prudently participate as the Japanese real estate market rebounds.

Strategic Ventures
During 2000, we achieved critical mass on strategic joint venture programs, with investments reaching over $2.8 billion. We invested in more than 180 projects with top-notch partners such as JPI in multifamily housing, Cabot in industrial properties and Storage USA in self-storage facilities.

Digitization
Backed by the strength of our Six Sigma design tools, we've made an enormous commitment to automate our business. Through digitization, we have not only reduced our cost structure, but have deepened our focus on meeting customer needs.

Looking forward, we are excited about prospects for strong growth at attractive returns on capital.

www.gecapitalrealestate.com