Report on the Strategic Environment: Brookfield Inc. and Competitors

This report offers a comprehensive strategic analysis of Brookfield Residential Properties Inc., examining its operations within the global competitive environment. It begins with an executive summary and introduction, followed by an overview of the company's top competitors, including their stock prices. The report then delves into the challenges faced by Brookfield Inc., such as the rise of e-commerce and the changing dynamics of the workplace. It also explores plausible future scenarios, including the impact of low home prices and the integration of technology into real estate. Further analysis includes a SWOT analysis, an examination of stock performance, and the implications for the real estate market. The report concludes with an analysis of Brookfield's strategies, including cost leadership, differentiation, and market development, providing recommendations for future growth.

Running head: Strategy and the Global Competitive Environment.
Report on a Contemporary External Strategic Environment: BSS058-6.
[Name of the author]
[Name of the institution]
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Table of Contents
Executive summary.........................................................................................................................3
Introduction......................................................................................................................................4
Top competitors...............................................................................................................................4
Challenges faced by the Brookfield Inc...........................................................................................4
Plausible future scenarios................................................................................................................5
Unprecedented low home prices..................................................................................................5
Integration of technology into real estate....................................................................................5
Changes in real estate agents job structure..................................................................................5
Strength and Opportunities analysis of Brookfield Inc...................................................................6
Strengths......................................................................................................................................6
Opportunities...............................................................................................................................6
Analysis on Stock performance and Market environment of Brookfield Inc..................................7
Stock performance.......................................................................................................................7
Implications to real estate market environment...........................................................................9
Strategies analysis of Brookfield residential properties Inc..........................................................10
Cost leadership marketing strategy............................................................................................10
Differentiation strategy..............................................................................................................10
Focus strategy............................................................................................................................11
Market development strategy....................................................................................................11
Recommendations..........................................................................................................................12
Conclusion.....................................................................................................................................12
References......................................................................................................................................13
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Executive summary
Strategic analysis is the most critical step for the growth of each organization's business,
especially in an era of economic uncertainty, technological trends, and additional challenges
facing companies such as the current trade war between the globe regarding the situation of
COVID-19 pandemic massively hits the growth of economics. Therefore, strategic analysis of
the enterprise by making precise decisions, including future planning, will affect its economic
growth. This report is based on tools and frameworks necessary for ensuring the business growth
of Brookfield Inc regarding the existence of various competitors in the business environment
where it currently operates, and their economic growth is facing uncertainty. The report also
provides the top competitors of Brookfield Inc as well as their market values. The challenges
faced by Brookfield Inc. and plausible future scenarios. The organization's strengths and
opportunities and stock performance and analysis of implications in the real estate market
environment. The analysis of Brookfield Inc's strategies and their recommendations.
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Introduction
Brookfield residential properties Inc is a real estate company that designs and constructs
premier homes and commercial properties. It was founded on March 31, 2011. It is a subsidiary
of Brookfield Asset Management Inc, and it operates in the US. and is headquartered in Canada
(Cao et al., 2018). The company develops land to build and create communities they sell to third-
party builders and its homebuilding division. Some of its are the Link at Symons Gate and
Regatta, the Octave, and Ivy University District. Its real estate ventures include infrastructure
projects, infill projects, joint ventures, and mixed-use developments (Shen et al., 2017).
 Market value: In 2011, the output value of the Canadian real estate development and
management industry was estimated at $28.2 million, up to 22% from 2005 (El et al.,
2015). Currently, Brookfield Residential Real Estate has 938 employees in all regions,
and its total production sales worth is the U.S. $1.94 billion.
 Market segmentation I: The residential area dominates the Canadian real estate
development and management industry leader, accounting for 73.2% of total market
worth.
 Market Segmentation II: Non-residential leasing area represents a further 17.8%.
Canada represents 12.8% of the Americas real estate management and development
Industry (Obi et al., 2019).
Top competitors
The main competitors of Brookfield Residential Properties Inc are the following:
 Boston Properties Inc (Stock price: US$93.67, -0.59%)
 CBRE Group Inc (Stock price: US$71.18, -0.21%)
 Simon Property Group (Stock price: US$110.44, +1.08%)
 S.L. Green Realty (Stock price: US$64.40, -0.92%)
 The Blackstone Group (Stock price: US$70.60, +0.51%)
 Vornado Realty Trust (Stock price: the U.S. $1.924)
Challenges faced by the Brookfield Inc
 The start-up growth in Canada and the emerging millennial influence in workplaces have
changed the working environment and real estate businesses (Kerzner, 2019). There is a
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rise in shared workforces compared to the traditional offices. Thus, there is a need for
adapting.
 The emergence of e-commerce and the growth of online retail stores is a potential threat
to traditional stores. This new trend massively impacts the real estate sector, and
therefore the real estate industry has to adjust to the new development (Tyfield et al.,
2016).
 The economy's performance in Canada has led to real estate's rising expectations as a
service, thus transforming the industry (Golub et al., 2018). Real estate spaces, whether
retail, residential, or office, are increasingly viewed as rentable services.
Plausible future scenarios
Unprecedented low home prices
The uncertainty of the deadly COVID-19 has sent the real estate industry on a rough path.
The substantial job losses, an extreme degree of uncertainty, and challenging economic times
have seen many people cut their spending (Steger and Meima, 2016). It has directly impacted the
real estate industry as people manage their finances and redirect them to the most basic needs. It
has seen a 56.8-per-cent decline in sales since the pandemic stroke and is expected to lower the
house rates till next year (Meissner and Wulf, 2015). However, the sales will increase slowly
over time.
Integration of technology into real estate
There is more need to integrate technology into the real estate sector driven by the current
state of affairs resulting from COVID-19. Several technologies were previously available to this
industry but were not always adopted in practice (Verbeke et al., 2016). The need for 3D home
tours and the incorporation of virtual open houses are on the rise in the current selling practices
(He et al., 2015). There is a possibility of maintaining a technological approach to viewing
houses in the future depending on its efficiency during this transition period.
Changes in real estate agents job structure
The use of technology and the effects of COVID-19 in the real estate industry has created
a shift in real estate agent service provision. Customers focus on agents who offer virtual
services and technological applications to facilitate the buying process (Shen et al., 2017). The
use of digital paperwork, virtual meetings, e-signatures are some of the customer needs that
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agents have to meet (Stone and Deadrick, 2015) currently. This trend can grow into a change in
consumer culture and directly impact the agent's current job structures.
The integration of technology into real estate is the most plausible of the scenarios
mentioned above. It is mainly attributed to different factors, including modifying demographics,
Prop-Tech digital transformation, and the most application offers to the real estate industry (Obi
et al., 2019). Construction technology is essential if the real estate industry matches the digital
transformation growth, innovations, and customer needs. Technological advancements such as
the internet of things (IoT), artificial intelligence, drones, robotics, automation, 3-D modeling are
being incorporated in smart-building and smart-home applications (Hanlon, 2018). It enables
them to identify construction issues faster and solve them before they start construction. Finally,
the use of virtual reality is crucial and a growing aspect of construction.
Strength and Opportunities analysis of Brookfield Inc
Strengths
Broad Product Mix
Brookfield Inc. owns a portfolio of 38 established private funds. Moreover, its investor
profile is diversified by type and geography. This broad product mix enables it to generate
recurring revenues (Meissner and Wulf, 2015). For instance, Brookfield generates revenues
through seven segments: Private Equity (63.2% of the total revenues in FY2018), Real Estate
(13.8%), Infrastructure (8.5%), Renewable Power (6.4%). Institutional investor support reduces
the volatility of revenue development.
Improved Cash Positions
Brookfield Inc. receives strong growth in cash and cash equivalents, which helped it ease
its short-term liabilities. Its cash and cash equivalents increased from $ 5.139 billion in F.Y.
2018 to $ 8.390 billion, an increase of 63.3% in FY2017 (Cao et al., 2018). An increase in cash
equivalents might be caused by an increase in the ownership of its short-term assets of the
business.
Opportunities
A positive stance towards the United States construction industry
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Brookfield could benefit from the American construction industry. The U.S. construction
industry is expected to grow at an annual growth rate of 3.52% from 2017 to 2021 and reach $
1.8 trillion by 2021 (Stone and Deadrick, 2015). During the forecasting period, government and
private sector investments will support infrastructure and energy projects. It is estimated that by
2021, housing construction will grow at an annual growth rate of 5.40%, valued at $ 745 billion
(Meissner and Wulf, 2015).
Rapidly Growing Renewable Power Sector
Brookfield is the owner of one of the largest hydroelectric power generating portfolios
globally due to an increased focus on environmental concerns. The demand for renewable energy
is growing all over the globe.
Intense Competition in the Real Estate Investment Trust Industry
Despite Brookfield Residential Properties Inc’s business size and end-user base, the U.S.
real estate investment trust industry is substantial. The principles of competitive factors in this
industry are lease space convenience, security, price, and cleanliness (Hanlon, 2018). Boston real
estate competes with many American competitors. Brookfield properties Inc faces competition
from other REITs such as Simon Properties, Equity Office Properties, and Vornado Realty Trust.
Analysis on Stock performance and Market environment of Brookfield Inc
Stock performance
According to the survey, Brookfield manages their business on a long-term basis. They
regularly present stock activity reports as an indicator of performance, which ultimately does not
represent a measure of their core value (Toivonen and Viitanen, 2015). Brookfield Inc.
emphasizes their businesses as flexible in market cycles. Furthermore, Brookfield Inc.'s domestic
value has grown significantly over the past twelve months with increasing interest rates
(Kerzner, 2019). The intrinsic value of the Brookfield business has improved and must be
maintained in the future.
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Figure 1 GRPV Analysis of Brookfield Residential Inc
Table 1 International peers - Brookfield Residential Properties Inc
Name of the
organization
State Market Cap. (m-
USD)
Beta 1-year Year-To-Data Price
Change
(in local currency)
Bumi Serpong
Damai
Indonesia 1,881 1.64 2.8%
Supalai PCL Thailand 1,453 0.75 -1.0%
Moura Dubeux
Engenharia
Brazil 1.231 1.83 -10.8%
Starts Corporation
Inc.
Japan 1,449 1.15 1.2%
Nam Long
Investment
Corporation
Vietnam 379 0.68 13.2%
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Figure 2 Chart for the stock performance of Brookfield Residential Properties Inc.
Implications to real estate market environment
The Economic fundamentals of the real estate market usually sustain strong globally.
Brookfield Inc. continues the legislation regarding the debt market has adequate liquidity and a
strong inflow of capital strategies. It happens in the reality of political interest and the last phase
of the business cycle (El et al., 2015).
 The real estate marketing environment exists objectively. Social, economic, and other
external environmental conditions in which real estate development companies are
always located specific and cannot be selected or controlled.
 The real estate marketing environment does not occur with the subjective wishes of
real estate companies.
 Many factors in the real estate marketing environment do not exist in isolation, and
there are specific interrelationships among various factors (Obi et al., 2019). For
example, sound economic development will increase the purchasing power of
customers.
 Due to real estate immovability, the real estate marketing environment is more
regionally affected than other marketing environments.
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Strategies analysis of Brookfield residential properties Inc
Cost leadership marketing strategy
Brookfield Residential Properties Inc. supports the Strategy of marketing leadership that
reflects the most competitive advantages of the overall Strategy, e.g., gaining quick awareness
regarding the brand, increasing the base for consumers, inspiring consumption as well as
attaining sales through accenting the accessibility as well as availability goals of housing (Smith
et al., 2019).
 The main goal of utilizing a leadership marketing strategy for maintaining leadership in
the real estate market by essential value chain management.
 The Strategy supports Brookfield Residential Inc. to increase its market sector by aiming
middle-class customers usually connect with great status for costing and pricing
management, therefore, a most suitable strategy for meeting the requirements of the real
estate market segment (Stone and Deadrick, 2015).
 Brookfield Residential Properties Inc. attentions to the affordability and availability of its
construction designs globally, which has grown to improve its awareness of the brand and
offers a healthy structure for a competitive benefit (Shen et al., 2017).
 Brookfield Residential Properties Inc. achieves sales goals in the real estate market by
utilizing this Strategy and respond to the competitive pressure of its most important step
(Golub et al., 2018).
Differentiation strategy
Brookfield Residential Properties Inc. combines differentiation and cost leadership
strategies to achieve growth goals. They provide various products for the real estate market that
meet the customer's needs (Kerzner, 2019). They also use innovation as a tool to provide
improved and differentiated services.
 The adoption of a differentiation strategy permits Brookfield residential properties Inc to
expand their customer base through unique construction designs that highlight the real
estate market's characteristics (Tyfield et al., 2016).
 The strategic goal is to use this Strategy to achieve differentiation through invested
innovation and meet consumer demand for residential and real estate properties.
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 Brookfield Residential Properties Inc. supports the positioning of its construction by
distinguishing from existing alternative designs of the construction (Toivonen and
Viitanen, 2015). Most investments have been made in advertising, celebrity promotions,
and proper marketing, differentiating Brookfield Residential Properties Inc.
Focus strategy
 Brookfield Residential Properties Inc implements an essential strategy in terms of the
best asset at low cost in which they satisfy the requirements of their customers in the real
estate market by lower reasonable price will lead to the core strategy of low-cost (Steger
and Meima, 2016). Furthermore, the sufficient worth of focus strategy is implemented by
accenting innovation in the designs and size of the construction, and appropriate material
meets their customers' satisfaction (He et al., 2015).
 Brookfield Residential Properties Inc. revises the brand strategy and continuously
changes the architectural design to meet the customer's psychological expectations for
achieving the worth of the money.
Market development strategy
 Brookfield Residential Properties utilizes this Strategy for improving the facilitation
penetration of the market and construction development (Hanlon, 2018). The new
customer in the real estate market has played an essential role in establishing Brookfield
Residential Properties Inc. as a global brand (Cao et al., 2018). Its global existence's main
reasons are reasonable prices, high brand awareness, and the structure's practical design.
 Brookfield Residential Properties Inc. continues to enlarge its network to cover every
sector globally, particularly in emerging states where the real estate market is presently
feeble (Stone and Deadrick, 2015).
 Brookfield Residential Properties can reduce prices and achieve sales through leadership
skills that successfully use an intensive growth strategy.
 Brookfield Residential Properties Inc. has four methods for applying intensive growth
strategy, including developing unique networks, making the latest real estate market
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sectors, developing innovative designs at low pricing, and supporting the latest
geographic regions (Verbeke et al., 2016).
Recommendations
 Meeting and reinventing the demands of the market should be a vital step in the real
estate industry.
 A successful strategy requires innovation and creativity. There is no doubt that finding
good deals is a dangerous challenge that pushes owners to balance their investment
portfolios through predictive analysis and analysis by searching for strategic partnerships
and acquiring different types of real estate.
 Revision of the proposed residential house plays a vital role in real estate. The industry
poses many challenges for large families and even alone individuals regarding cheaper
housing schemes.
 Advancements in technology should enable commercial real estate owners to grow their
businesses effectively. For example, various software such as hiring management, 3-D
modeling, AutoCAD, blockchain transactions will support enhancing operations and
reduce costs.
 E-commerce is a necessary incentive to increase suitable distribution centers near important
cities and increase demand.
 Analysis of data and digital tools should play an essential role in making timely
decisions, predicting future market changes and behavior. Therefore, the real estate
market owners need to enter the world of technology and effectively use all its aspects
to create a successful business strategy and better understand the market.
 Commercial real estate usually has the highest value, so the company should mainly
participate in large office buildings and shopping malls.
Conclusion
In conclusion, considering the real estate industry's dynamic nature, it is not surprising
that its future must be bright. However, the most crucial reason for Brookfield Residential
Properties Inc. is that it can select the correct mixture of proposed Strategy, including
intensive growth strategies based on present competition and the real estate market
conditions. The analysis showed that the costs and risks connected with each intensive
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growth strategy are diverse, and the option of each intensive growth strategy of the company
is related to the overall growth strategy. Advancements in technology enable commercial
real estate owners to grow their businesses effectively. Finally, a successful strategy requires
innovation and creativity to enable commercial real estate owners to grow their businesses
effectively and pushes owners to balance their investment portfolio with predictive analytics
and strategic partnerships.
References
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