Four Big Takeaways From Bisnow's First UK Event
With puppies, drones, a smoke machine, shoe polisher and world-class industry professionals, Bisnow's UK debut—and sold out—London State of the Market was far from a usual dull corporate event. Over 600 attendees settled around a boxing-ring set up in the Intercontinental Park Lane to hear from a cadre of all-stars about what trends to expect in 2017.
Overexposure To Tech
With the glut of technology companies and skimpy supply in London, landlords carry a risk of overexposure to the tech sector. To mitigate the threat, landlords are devoting real effort to getting the right mix of tenants. Derwent London’s John Burns told the audience he doesn’t set out to attract a certain kind of tenant, though tech companies do tend to love his spaces. He approaches each potential occupier in a personal way—he likes to know the kind of people they are, not just the sector of business they're in.
Cushman & Wakefield’s Juliette Morgan seconded that, noting that to get the right people in the right space, she’s been flexible with security deposits, for instance, and views tenants as partners and customers, instead of just rote transactions to fill a particular building. WeWork’s Patrick Nelson, who has 11 buildings in London and is just about 100% occupied, noted that tech is in its infancy, and almost every landlord has some exposure. But individuals with good work ethic are the ones you want, no matter the industry.
London’s Challenges Will Require Bold Solutions
The future of London is less regulated and more sustainable. One of PLP Architecture’s founders and principals Lee Polisano said bluntly that London’s vitality is threatened by its lack of housing affordability. But he doesn’t think there's a lack of space to build on. National Housing Federation's David Orr took it further, breaking a London taboo by suggesting developers build on the greenspace. London’s greenspace is twice the area it was 30 years ago, David said, and the value of land is what can be created from it.
Lee also said that fighting regeneration was an excuse to do nothing. Leaving poor quality, low-density housing as it is doesn’t help anyone. By bringing in market-rate housing, the development becomes more economically sustainable and more diverse. He believes government should increase incentives instead of more regulation.
The Global Network Is Increasingly Important
Argent’s David Partridge, creator of Kings Cross, one of London’s most high profile placemaking projects, noted that developers do have an appetite for big, long-term projects—and often that means accessing capital offshore. China’s investments in some of the second cities like Birmingham and Manchester are evidence that Britain is still an attractive investment.
Brexit Isn't Causing Problems
JLL’s Eric Pang said that when you tune out the political noise, the fundamentals haven’t changed—and they’re very positive. While we may have bumps along the way, Eric says London really is open for business and the capital remains one of the most stable investments in the world.
British Land's Chris Grigg (in centre) dismissed the entire idea of a "post-Brexit world" and said that we are in the middle of a predictable cycle.
GM Real Estate’s Tony Gibbon's phone has been ringing off the hook with European investors wanting to do deals (shown below with Chris Grigg and Sir George Iacobescu, who is also shown with the puppy). They’re looking at the long term, he says. Investors and developers shouldn’t react to short-term pressure from shareholders.
Join us on January 17, 2017 for another fun, informative, and ground-breaking event, New Frontiers. It will be hosted at the Shard with breathtaking views across London. We’ll explore how London is unlocking hundreds of millions of pounds in the nighttime economy and discover emerging neighbourhoods. You’ll hear actionable intelligence direct from industry leaders about where to invest and what London’s next chapter holds. New Frontiers is a more intimate event with a maximum capacity of 220 seats so secure your ticket now.