Electric Dreams – Victoria Towers speaks to Property Week
30 November 2022
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Co-Head of Industrials & Logistics, Victoria Towers, has spoken to Property Week about the aim of warehouse developers to get ahead of the game by installing charging facilities for electric HGVs and vans, as well as investing in solar power.
In light of the statistic that 16% of the UK’s domestic transport emissions come from HGVs, many warehouse developers are looking to increase the current percentage of electric vehicle (EV) charging provision, which currently stands at around 10% of parking spaces.
While the sale of new petrol and diesel cars will be banned by 2030, new petrol or diesel HGVs will not be banned until 2040. Nevertheless, eHGVs are gaining momentum.
Towers commented: “The new shed developments we’re seeing all have EV charging provision for cars and vans and the bigger players are starting to secure warehouses with provision for HGVs. We expect other businesses to follow suit, especially as restrictions and extra charges come into force in towns and city centres to deter the use of petrol and diesel vehicles.”
This article was first published in Property Week on 25 November 2022 and is available to read in full here, behind their paywall.
Hannah Mantle to speak at Trust & Estates Litigation Forum 2022
29 November 2022
News
Contentious Trusts and Estates Senior Associate, Hannah Mantle, has been invited to speak at the Private Client Global Elite Trust and Estates Litigation Forum 2022.
Hannah will be speaking at the session entitled ‘Risky Business: Investment Management Claims’ alongside Tamasin Perkins of Charles Russell Speechlys and Christian Hay of Collas Crill.
This annual forum, taking place from 30 November to 2 December, brings together trust and estate litigators to connect and discuss recent contentious trust proceedings and developments from around the globe.
Key Takeaways – Nicola Copsey attended the ‘Current Trends in Sheds and Industrial Developments’ webinar
24 November 2022
News
Commercial Real Estate Senior Associate, Nicola Copsey, attended the ‘Current Trends in Sheds and Industrial Developments’ webinar. The event described the most recent movements in the industry. Below are her key takeaways:
To help slow my heart rate after the shock defeat of Argentina at the hands (or rather feet) of Saudi Arabia and the damaging effect that has had on my fantasy football team, I dialled in to the webinar on Current Trends in Sheds and Industrial Developments, where the speakers were Lesley Males, Chris Hobday, Tom Malcolm Green and Mat Rogers from Avison Young. Little did I know that the shocks would continue! Here is a short summary of the webinar.
Demand
The demand for Big Box space (over 100,000 sq ft) remains strong but has declined compared to last year. By the end of 2021 there had been take up of over 50 million sq ft of grade A Big Box space, and we will not surpass this in 2022
The demand is driven by a critical lack of supply
Take up of grade A Big Box space is highest in the East Midlands, followed by the West Midlands, given its strategic location (within a 4 hour drive of much of England)
In London, levels of take up in 2022 are 50% of those seen in 2021 (partially due to a lack of supply)
3rd party logistic providers dominate take up, largely due to the increase in online shopping which escalated during the pandemic. Although retail sales are declining, especially over the past few months due to the cost of living crisis, the requirement for space by 3rd party logistic providers will continue as internet sales as a percentage of total retail sales are expected to hit 30 – 35% in the coming years
Type of Property
Design and Build (compared to existing builds and speculative builds) has an increasing share of the take-up for 2 key reasons:
Occupiers are becoming more specific in their requirements for space, especially as the importance of ESG increases
Speculative builds are becoming more expensive because of the increasing costs of materials and labour. Some developers aren’t committing to lettings until buildings have PC’d due to uncertainty over costs
Lack of Supply
There is only 24 million sq ft of grade A Big Box availability nationwide
52% of this supply is under construction
The critical lack of supply is expected to continue into 2023 and is causing reduced occupier take up
Key cause of the lack of supply is the slow planning system, even where a site is non-contentious
Other causes are supply chain and material issues, labour shortages and the costs of getting materials to site
Economic uncertainty
UK investment volumes declined sharply in qtr 2 and 3 2022 because of economic uncertainty. AY reported one purchaser pulling out of a deal post-exchange and forfeiting a deposit of between 12.5 and 25 million pounds
However cash buyers who don’t need to rely on debt may be able to take advantage of a slow in demand
Overseas buyers may be in a better position due to a weaker pound. The highest levels of overseas investment in 2021 came from North America, and this trend is set to continue in 2023 when overseas investment is expected to be higher than domestic investment
Industrial rental growth is still outstripping CPI inflation and the growth is expected to continue
The speakers were not too concerned by the ongoing economic uncertainty because there is a backlog of demand. So even if some investors hold off, there will be others to fill the void
Occupiers wanting to expand are generally holding off at the moment, however other reasons for taking space (i.e. relocation and moving to buildings with increased efficiency in light of energy costs) are still pushing up the demand
Emerging sectors
Vertical farming i.e. the practice of growing crops in vertically stacked layers- due to environmental pressures and population growth, this is expected to be an emerging sector. M&S and Tesco have trialled vertical farming, and there was investment of 800 million USD in 2021 which is expected to grow each year, especially in light of the war in Ukraine
Open storage (e.g. not built upon) – there has been an increase in demand for higher quality open storage (with security and lighting) since the logistic issues caused by Brexit and the pandemic. Enquiry levels in 2022 are already double those since 2021
Data centres- for those with access to the internet, 40% of our waking day is spent online. By 2025 the total amount of data consumed globally is forecast to treble compared to today. The installed base of storage capacity is forecast to increase, growing at a compound annual growth rate of 19.2% from 2020 to 2025. London is the data centre capital of Europe, but some boroughs are out of capacity for the next 8/9 years because of a shortage of power needed to run them. This may encourage an increase in the use of renewable energy sources
ESG
The built environment is responsible for 38% of global emissions and 35% of its power consumption
There is an increasing use of renewable energy, particularly PV panels. Not only does this have a positive environmental impact, but it can create a revenue stream when sold back to occupiers which also benefits occupiers because of the cheaper rates of energy
By 2030, the minimum energy efficiency standard in relation to let non-domestic buildings is set to increase to a B rating. Currently, 90% of properties on the EPC register are below B so there is a huge amount of work to be done by 2030. To upgrade every property on the EPC register to a B rating would cost an estimated £30.5 billion (£334,000 per property)
Part of the issue is that the industrial sector has much older stock compared to retail and office sectors. 40% of industrial stock is 40 years and older, with 8% being built pre-war
On the positive side, the average EPC rating of industrial properties has increased by 3% per annum since 2016 when MEES was introduced
Summary
Strong occupier demand continues but economic situation creating uncertainty
Growing sectors could create opportunity in future years
Retrofitting – out with the new and in with the old
Maryam Oghanna to speak at Annual Bar & Young Bar Conference 2022
21 November 2022
News
Contentious Trusts and Estates Senior Associate, Maryam Oghanna, has been invited to speak at the Annual Bar and Young Bar Conference 2022: Future-proofing the Bar.
This annual conference takes place over four days and will explore the deep rooted issues that underpin the justice system and their impact on the providers of legal services today.
Maryam will be speaking at the session entitled ‘Predicting industry trends and creating a financially sustainable chambers’ alongside chair Fiona Fitzgerald of Radcliffe Chambers and other industry experts.
The conference will take place from 23-26 November. You can view the full agenda and register to attend here.
The London Prime Property Market: Helen Marsh features on Bellecapital podcast
17 November 2022
News
Residential Property Partner, Helen Marsh, joined Rudy Vandaele-Kennedy of Bellecapital and Claire Reynolds of Savills to discuss the London Prime Property Market.
Prime London, although not representative of the whole market, is a key segment. UK property market coverage remains negative but how do the recent increases impact different sectors and locations?
Helen, Claire and Rudy address the below discussion points:
Rates/inflation outlook
Prime property prices
The difference between a ‘turn-key’ property and those that require work
Forsters advises McLaren Applied Limited on its Asset Based Lending (ABL) facilities.
17 November 2022
News
Forsters has advised McLaren Applied Limited, which is known as a technology first supplier, notably to the motorsport industry in relation to its ABL and cashflow facilities with IGF.
This transaction highlights Forsters’ expertise in advising borrowers on their ABL facilities which are becoming increasingly popular in the UK debt market.
Rowena Marshall from the Forsters Banking & Finance team, alongside PwC’s Debt & Capital Advisory team acted as key advisors to McLaren.
This London conference features US and UK tax experts as well as specialists in immigration and wealth management, and is designed to provide full coverage of the transatlantic tax ecosystem. Emma will be speaking at the session entitled ‘Estate Planning and Charitable Giving’ alongside Jaime McLemore of Withers and Jo Crome of CAF American Donor Fund.
The conference will take place on 30 November. You can view the full agenda and register to attend here.
On 3 November 2022, The Court of Appeal published its decision in O G Thomas Amaethyddiath v Turner & Ors [2022] EWCA Civ 1446 which concerned a narrowing of the scope of the Mannai Principle, a rule that can be relied upon in certain circumstances to save a defective notice.
The decision highlights the potential pitfalls in relation to the service of notices and emphasises the importance of taking proper legal advice when serving notices to ensure compliance with service requirements.
Mannai Principle
Parties serving notices must adhere to any contractual and/or statutory requirements that govern the service of the notice. However, if a party has failed to comply with these requirements, there are circumstances in which they may be able to rely upon the Mannai principle established in Mannai Investment Co Ltd v Eagle Star Life Assurance Co Ltd [1997] UKHL 19.
The Mannai principle may be relied upon to save a defective notice if the reasonable recipient “would not have been perplexed in any way by the minor error”.
This doctrine was tested in Trafford Metropolitan Borough Council v Total Fitness UK Ltd [2002] EWCA Civ 1513 and a two-stage test for the applicability of the Mannai Principle was established as follows:
Consider what the notice says on its true construction.
Compare the notice to the relevant requirements for that notice to establish whether the notice meets the requirements.
O G Thomas Amaethyddiath v Turner & Ors [2022] EWCA Civ 1446
The facts of the case were that:
Mr Thomas had a tenancy of an agricultural holding which he had assigned to a company without his landlord knowing.
He was the sole director and shareholder of the company and its registered address was the same as his home address.
Following the assignment, the landlord of the holding served a notice to quit at Mr Thomas’ home address and which was addressed to Mr Thomas rather than the assignee company.
The Court of Appeal held that this was not an instance in which the Mannai principle could save the defective notice. The notice was addressed to a previous tenant of an agricultural holding and so was not given to the current tenant. This is despite the fact that the landlord could not have known about the assignment and the current tenant was a company of which the previous tenant was the sole director and shareholder and both the company and the tenant were registered at the same address.
This case demonstrates how difficult it can be to serve notices correctly, given the strict requirements that apply. Not many cases will involve a concealed assignment but it remains important to ensure proper legal advice is always sought in relation to the service of notices and all available investigations are undertaken to ensure the correct party receives the notice at the correct place.
This exclusive event for international private client advisors has been curated ‘by the experts for the experts’ and will span across two days. Charlotte will be speaking at the session entitled ‘Working with Family Offices: Should you have one? Setting One Up? Client, Obstacle or Threat?’ alongside Krya Motley of Boodle Hatfield and Sally Tennant OBE of Acorn Capital Advisors.
The conference will take place from 15 to 17 November 2022. You can view the full agenda, and register to attend here.
Forsters advise Evolution Markets on relocation within the City
7 November 2022
News
Forsters have advised Evolution Markets Limited on the acquisition and legal aspects of the fit out of their 38 Threadneedle Street headquarters in the City.
Evolution Markets provides strategic financial and industry-leading transactional services to participants in global environmental and energy markets and is recognised as a leader in green markets.
Glenn Dunn, Head of Forsters’ Corporate Occupiers group, advised Evolution Markets and was assisted by Owen Spencer and Charlotte Mashhoudy.
Cladding disputes: liability – Dan Cudlipp, Emma Forsyth & Phoebe Jackson write for the Property Law Journal
7 November 2022
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Construction Senior Associate, Dan Cudlipp, and trainees Emma Forsyth and Phoebe Jackson, have written for the Property Law Journal, on construction contracts and the implication of the judgment in Martlet Homes v Mulalley.
This article was first published in Property Law Journal 402 (November 2022) and is also available on lawjournals.co.uk.
The case of Martlet Homes v Mulalley [2022] concerns the use of defective cladding in high-rise tower blocks and is of particular significance as it is the first High Court judgement on a cladding system dispute following the Grenfell Tower tragedy.
Cudlipp, Forsyth and Jackson write of the background to the case, the claim judgement, and wider significance and highlight how: “In a construction contract, the question of whether there has been a design or specification breach requires a consideration of professional negligence.”
They summarise that “a holistic approach when considering regulatory framework is essential. Moreover, design and build contractors cannot shy away from their responsibilities as qualified designers by seeking to rely on what others in the industry may be doing.”
Forsters recognised as an industry leader in The Times’ Best Law Firms 2023
3 November 2022
News
Forsters, one of London’s leading Real Estate and Private Wealth law firms, has been recognised in The Times’ Best Law Firms 2023.
Published on 3 November 2022, the guide recognises the best lawyers for business, public and private-client law across England, Wales and Scotland, as chosen by lawyers.
Forsters is commended for its Real Estate and Private Wealth law capabilities, the firm has been ranked as a ‘Best For’ firm in the area of Landlord and Tenant law and newly ranked for its Private Wealth Tax expertise. Forsters is also commended in the Commercial Property, Family, and Inheritance and Succession categories.
The firms’ continued inclusion in The Times Best Law Firms is testament to the firm’s strength and breadth of expertise and solidifies our reputation as a go-to firm for real estate and private wealth advice.
This episode of the More Than Law Podcast was recorded at the UK Atomic Energy Authority (UKAEA) headquarters with Dr Alexander Pearce, the modelling lead in the UKAEA Power Plant Technology Group, and senior associate Laura Haworth. Alex and Laura joined podcast host Robert Linden Laird Craig to talk about fusion energy; what it is and how it might one day be used to put power on the grid.
The Building Safety Act 2022 (the Act) received royal assent in April 2022, with its provisions coming into force in tranches over the following 18 month period. The extension of the limitation periods and leaseholder protections, both of which are explained in more detail below, are already in force. Following the recent launch of a government consultation on implementing the new regulatory regime for higher risk buildings, which is another key element of the legislation, we thought we would take the opportunity to look at what the Act changes in practice.
1. Potential Claims
Extension of Limitation Periods
Claims under the Defective Premises Act:
The Defective Premises Act enables claims to be made for defective work relating to the construction of dwellings where the work renders the dwelling unfit for habitation. The limitation period (deadline) for claims brought under the Defective Premises Act is extended from 6 years to 15 years for new claims.
Where the claim relates to construction rather than the refurbishment of dwellings, there will be a retrospective 30-year limitation period.
Section 38 of the Building Act:
This section provides a statutory right of action for breach of a duty imposed by the building regulations, so far as it causes physical damage (either injury or property damage). The limitation period for breaches is extended to 15 years.
Claims against construction product manufacturers:
Where the use of defective construction products leads to the building being uninhabitable the limitation period will be 15 years. If the claim relates to a cladding product however, there will be a 30-year retrospective limitation period.
Other claims
There will be a new right for those with an interest in a dwelling to claim against construction product manufacturers where the product fails to comply with a relevant requirement, has been mis-sold or is inherently defective and the use of that product causes or contributes to the dwelling being unfit for habitation.
The High Court is able to make building liability orders against developers who have failed to meet a relevant liability under the Defective Premises Act 1972, or s38 of the Building Act 1984 as a result of a risk from fire spread or of structural collapse.
New build home warranties to provide cover for 15 years.
2. Remediation Costs
Part 5 of the Act deals with liability for costs of relevant defects, i.e. anything arising out of things done or used in connection with relevant works in the last 30 years or after that period to remedy a relevant defect which causes a risk to safety from fire or building collapse.
A ‘waterfall’ approach is taken to liability – developers pay first, then manufacturers, then freeholders and then leaseholders last.
The Act introduces various leaseholder protections which are intended to mean that leaseholders pay for fire safety related remedial works only as a last resort.
Leaseholder owned buildings are current excluded from these protections but, otherwise, they apply to any qualifying lease of a dwelling, i.e. one for more than 21 years granted before 14 February 2022 where as at that date the dwelling was the leaseholder at that time’s only or principal home and he/she did not own more than 2 other UK dwellings.
Cladding defect costs
Building owners are liable to for paying for all remediation costs and any associated interim measures (waking watch etc) if they are, or are associated with, the developer of the building.
Even if they are not, they cannot pass on any of these types of costs to qualifying leaseholders.
Government funding may be available for this type of remediation and building owners are obliged to investigate this, or if there are any viable third party claims, to ensure that any costs passed on are not deemed to be unreasonable service charge costs.
Non cladding defect costs
Building owners are liable to pay for all of these types of costs (including associated interim measures) if they are, or are associated with, the developer.
If they meet a contribution condition (i.e. have a net worth of at least £2 million per relevant building) then they cannot charge qualifying leaseholders for these types of costs.
3. New Regulatory Regime
Applies to ‘higher risk’ buildings, i.e. those of at least 18 metres or 7 storeys high. Provided the height threshold is met then draft regulations confirm that buildings in scope must contain at least two residential units (dwellings or other unit of temporary accommodation), or be hospitals and care homes during the constructions phase.
The Building Safety Regulator (“the Regulator”) will be the building control authority.
Building safety is to be considered at each stage of design and construction, with a ‘golden thread’ of information about each stage being maintained to ensure that building safety risks are managed throughout the building’s life.
An Accountable Person will be the duty holder and must register the building before it is occupied, apply for a Building Assessment Certificate, and proactively manage safety risks by way of a Safety Case Report which must be kept up to date and be submitted to the Regulator. Once registered the Regulator will manage the assessment process by ‘calling in’ higher-risk buildings. For new buildings, this is likely to be within six months of occupation, with existing buildings being called in in tranches from April 2024.
An amendment to the Regulatory Reform (Fire Safety) Order 2005 will require all Responsible Persons to record their fire risk assessments and only instruct competent persons to undertake these assessments. Closer collaboration with other Responsible Persons in the same building is also expected and in the case of residential higher risk buildings, Responsible Persons will need to co-operate with the Accountable Person.
Forsters maintains Tier 1 ranking in eprivateclient’s Top Law Firms 2022
1 November 2022
News
We are pleased to have once again been recognised as a Tier 1 firm in eprivateclient’s ‘Top Law Firms’, a ranking of top private client law firms in the UK.
The firm’s top-tier position reflects the quality and breadth of its private client practice and the excellence of its lawyers. It is a well-deserved reward for the hard work of the team.
Click here to view the 2022 eprivateclient rankings (behind a paywall).
