Forsters team supports Ministry of Defence in settlement of landmark litigation, bringing Armed Forces housing back into public ownership
17 December 2024
News
The Ministry of Defence (MOD) and Annington Homes have today announced that they have reached a major deal to bring the Armed Forces housing estate back into public ownership. MOD will re-acquire c36,000 houses from Annington Homes for a total purchase price of £5.9945bn, as well as unwinding the complex and costly set of contractual arrangements between the parties which has governed their relationship since 1996.
The transaction marks the culmination of landmark litigation between the parties concerning the scope of MOD’s enfranchisement rights. Forsters has advised MOD in relation to the enfranchisement and subsequent litigation since 2020 and the firm was also selected to handle the transactional elements of the deal, which is one of the largest property transactions in UK history. The entire Forsters team has worked immensely hard on behalf of MOD, alongside Slaughter and May who advised on the public law aspects of the litigation, to help bring matters to a successful conclusion.
The Forsters team comprised Senior Partner Natasha Rees, Real Estate Disputes Partner Julia Tobbell and Commercial Real Estate Partner Ben Brayford. They were supported by Senior Associate James Carpenter (Real Estate Disputes), Counsel Andrew McEwan, Senior Associates Alexandra Burnaby and Alex Harrison and Paralegal Kelly Pryor (Commercial Real Estate).
‘Planning to make a better rental market’ Helen Streeton shares her thoughts with Landlord Today
5 November 2024
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Following its General Election victory, the Labour Government sprang into action to tackle the housing crisis, tabling a Planning and Infrastructure Bill and Renters’ Rights Bill in the King’s Speech within weeks of taking office.
It also announced an eight-week consultation on a revised NPPF, reiterated its manifesto commitment to delivering 370,000 homes a year in this parliament, and addressed mandatory housing targets for councils and the ability to build homes on the ‘greybelt’ (greenbelt of poor quality and underutilised land).
It’s clear that Britain’s 12 million renters won’t be forgotten under a Labour Government, but will Labour policies create an appealing landscape for investors?
The UK Build to Rent sector is one of the fastest-growing sectors in the housing market, with the delivery of units increasing at an average rate of 54% per annum between 2015 and 2021, according to JLL. Despite this, there is disparity up and down the country regarding planning authorities’ knowledge and understanding of BTR as a product and how financial viability modelling works. This is different to housing delivered for sale.
The number of households renting is rising, 35% of households now rent, compared with 35% who own outright (most of whom belong to the over 65 age category) and 30% who own with a mortgage. Renting is no longer the reserve of the young, with the number of households in England where the main tenant is between 45 and 64, sitting at around 70% of the rental market.
The Renters’ Rights Bill seeks to ensure that renters have long term secure and high-quality housing. BTR developers and operators welcome new laws which will provide these protections – the vast majority of landlords want their tenants to be with them long-term and already provide the flexibility to move between properties as needs change.
At the same time, any new legislation needs to ensure a balance between those protections and investor appetite – it would backfire if the upshot is that landlords, especially smaller PRS landlords, withdraw from the market, further choking off supply and putting upward pressure on rents.
Research from the British Property Federation earlier this year showed that 40% of BTR sites take at least a year to achieve planning consent and there are concerns within the industry about the pace at which the new Building Safety Regulator can review buildings within the Building Safety Act Gateways.
Changes to the planning system are a key priority for the government, with Labour hoping it can unlock schemes and investment. Great certainty in planning timelines and a clear framework should enable schemes to progress more quickly. But with both the planning system and building safety, questions remain over resource – is there enough focus on ensuring we have professionals with the necessary skills within the sector?
Labour’s ‘getting Britain building’ rhetoric will only succeed if there are fundamental changes to how Britain’s planning system operates in tandem with a concerted effort to increase resource at a local and national level.
The industry and investors will be eagerly awaiting next steps on the Renter’s Rights Bill tabled by the Government, which is now at the committee stage. Early signs are promising for individual renters, with increases to rights and protections including banning Section 21 ‘no-fault’ evictions for new and existing tenancies. However, the precise and final details of the Bill will be critical in determining the impact on investor appetite.
Labour needs to work closely with industry stakeholders to develop a rental framework that balances the interests of landlords, tenants, and local communities, ensuring fair and transparent practices.
This article was published in Landlord Today on 04 November 2024.
Amy France tells EG about the diversification of the later living sector
5 November 2024
News
After a lacklustre year so far, we are finally seeing some positive movements in the later living sector. The exciting part is that many of the new developments demonstrate the diversification of the industry in terms of ownership models and affordability, both of which have been anticipated for some time.
Although the primary focus on the Older People’s Housing Taskforce has been to explore ways to increase the provision of homes to meet a high level of projected demand, we are also anticipating in-depth guidance on how the sector should adapt to meet the increasingly sophisticated nature of those consumer demands. In practice, this means a much greater choice of tenures across a much wider variety of locations.
We might still wait with bated breath for the outcomes of the task force, however there are signs that the sector is already rising to the diversification challenge, fuelled by a gradual increase in investment.
Affordable options
A recent example is New York-based private investor Meadow Partners’ partnership with shared ownership specialist Affordable Housing & Healthcare Group to build a £500m senior living shared ownership portfolio. AHH is an affordable housing-focused provider with a footprint in the South West which has a unique shared ownership model, in that it typically sells off 50% of its retirement living developments and rents the other half to occupiers. In a similar move, albeit on a smaller scale, Vistry Group has recently agreed a £19m deal with Anchor to build 77 affordable homes in the East Midlands.
It is not just affordable housing that is spreading beyond its usual parameters. We are also seeing retirement villages, most commonly found in London and the South East, gaining ground elsewhere in the UK. In this regard, Adlington Retirement Living stands out, having recently announced plans to build a 96-home community in Leicester, to add to its 18 independent retirement communities created since 2008 across the North West, Yorkshire, Wales, Bedfordshire and the Midlands.
The level of amenity is an area that can be adjusted by developers to deliver more affordable options, with some developments scaling back to one multi-purpose community room to accommodate social activities. Mid-market solutions might, for example, forgo an on site restaurant, particularly in town centre locations, where there is less need.
This trend will continue as economic conditions improve and developers become more ambitious in terms of scale. Shared facilities between a higher number of homes reduces operating costs and consumer prices. There is also hope that the new government, with its emphasis on housing delivery, might finally reduce some of the current strain on senior living developments caused by the planning system and serve to boost numbers.
Catalyst for action
Another key shift is a growing provision of rental housing for older people. This is happening for a plethora of reasons that deliver multiple benefits to consumers, providers and the general health of the housing market. These include greater flexibility over the timing of the sale of the family home, quicker access to services and care, no maintenance worries, no exit fees and no long resale periods.
So far, Birchgrove is the only dedicated developer building retirement homes solely for rent. But with such a huge and growing demand, others are likely to follow. Birchgrove itself is exploring different formats. For example, in conjunction with Hybr, the developer has launched an intergenerational living scheme in north London which will see students, key workers and retirees living alongside one another.
As the sector races to address the deficit of housing for older people, it is pleasing to see that, at the same time, careful thought is going into meeting the needs of a diverse range of people. The eventual publication of the findings of the task force should act as a further catalyst for action, with backing from the UK’s new pro-housing and development government.
It would be great to see Labour’s planned new towns becoming a template for delivering the right balance of the different types of senior housing into a single location. Certainly, the older generation deserve to have their varied needs met just as much as other demographics, such as first-time buyers and families, which have been the priority for so long. Let’s hope that this new focus on diversification continues at pace.
This article was published in EG on 26 October 2024.
Lessons from the Olympics: creating lasting value at pace. Helen Streeton writes for EG
12 September 2024
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With the Paralympics now finished, attention turns to what the future holds for Paris’s Olympic Village and its legacy for Parisians.
The newly developed Olympic Village is to be transformed into a combination of homes, leisure, commercial, community and education facilities. The homes will be a mix of social and open-market homes, with the design of the apartment buildings highlighting how good affordable housing can be.
Similar to the plans for Paris, the London 2012 Olympics kick-started a huge regeneration project in east London, transforming Stratford and Hackney Wick through £400m of investment into the area. This delivered economic growth which exceeded pre-Games projections three-fold, with almost 40% growth in local employment and thousands of homes (East Village, the former Athletes’ Village, has more than 3,284 homes and an estimated 6,500 people live there). Legacy was at the forefront of the vision for the London Olympics – a goal it has seemingly successfully achieved.
The French government also has ambitious plans to create four new Metro lines for greater Paris through the Grand Paris Express project, which will focus on connecting disadvantaged areas and streamlining commutes for thousands of people. Not only does this new infrastructure reduce travel times, but ultimately provides access to employment opportunities and amenities that are currently out of reach for many in Paris. It is said there will be 11 times more job offers to people within a 45-mile radius of the new hub than now, showing the true value added through improvement to infrastructure and travel.
Need for speed
The connectivity to Stratford was key to unlocking the East Village. Stratford International opened in 2009, connecting the area to King’s Cross in seven minutes, followed by the Elizabeth Line in 2022. Sustainable travel connections need to underpin any major regeneration, alongside employment opportunities and affordable housing.
Hosting the Olympics is a remarkable opportunity and can create meaningful value for the surrounding community and wider country, but it cannot continue to be the case that we need to be on the world stage to release necessary funding and deliver projects successfully and at speed.
Government funding was a key element of ensuring the London Games were delivered by the Olympic Delivery Authority and demonstrates that it is possible to deliver government-funded housing at speed when there is a need. With the Athletes’ Village then sold on to the private sector, this shows how effective public-private partnerships can be.
In many ways, the transformational ideas of the Paris and London games align with the Labour government’s focus on “new towns”. A few weeks ago the government announced its New Towns Taskforce, a key role of which will be to advise ministers on appropriate locations for significant housing growth. A final shortlist will be coming down the track within 12 months.
We can expect a mix of new standalone communities built on “greenfield” and a number of “urban extensions”, presumably to optimise transport links and other important infrastructure. The unifying principle is that they will contain at least 10,000 homes. That is a large metropolis, which will throw up additional demand for public services – schools, medical facilities, green spaces and so on. It isn’t clear where this land will come from – exercise of CPO powers is slow and public-private partnerships may be a part of the answer for land assembly.
Lessons from the past
As a new programme of garden cities and new towns looks increasingly likely, it is surely the case that there is much to be learn from the post-war new towns programme – the most ambitious large-scale project of its type in the UK. Between 1946 and 1970, 32new towns were delivered across the UK. Brought forward by development corporations, which had a wide range of borrowing, planning and strategic powers, the towns provided homes and jobs, while aiming to create socially balanced communities. Key to the successful delivery of these new towns was the powers the development corporations possessed, similar to those that the Ebbsfleet Development Corporation has for the delivery of Ebbsfleet Garden City.
The New Towns Taskforce is in good hands with Sir Michael Lyons, who chaired the 2014 Lyons Housing Review, at the helm. It will be interesting to see how the plans develop – what use can be made of the existing legislation and what lessons can be drawn from the building of the previous new towns – to deliver much-needed housing. Much like the Olympic villages of London and Paris, the earliest new towns were delivered quickly – Stevenage in 1946 and Harlow by 1947. Let’s hope we can take some lessons from the Olympics.
Published in EG on 10 September 2024, you can also access the article here.
What’s in store in ’24? Andrew Crabbie quoted in BE news
30 January 2024
Views
Andrew Crabbie, Partner and Head of Commercial Real Estate, has been quoted in BE News offering his predictions for 2024, alongside other leading industry figures.
Crabbie highlighted the importance of high quality, sustainable office space to occupiers, as Forsters settles into their new office in 22 Baker Street. He stated:
“Planning will continue to be a thorn in the side for developers. Local and national government must get to grips with the planning application bottlenecks (though with a general election looming, it is likely this will be on the back burner). The impact in 2024 of the introduction of biodiversity net gain regulations will prove another challenge to developers. Michael Gove’s decision to refuse M&S’s plans to develop its flagship store on Oxford Street on the grounds that the project was not compatible with the transition to a low-carbon future has amplified the ‘demolish and re-build versus retrofit’ debate, which will continue to run in 2024. From an occupier perspective, the flight to quality zeitgeist will grow across all assets as companies share the same priority of inhabiting well located, highly amenitised, sustainable and flexible workspace that puts the performance and well-being of its employees at its heart. Indeed, here at Forsters we’re a living, breathing exemplar as in January we’re consolidating our London business into a new headquarters on Baker Street in the heart of Marylebone.”
The full article was published by BE news and can be read here (behind their paywall)
The charge of microgrids – Louise Irvine speaks to Property Week
25 September 2023
Views
Senior Knowledge Development Lawyer in the Commercial Real Estate team, Louise Irvine, has spoken to Property Week on energy alternatives for developers, should the national grid run out of capacity.
One method of overcoming the issue of power shortages, currently being considered by developers, is the creation of microgrids, which involves producing and storing electricity from renewable sources locally and then distributing it around a development.
Main benefits
Irvine believes in the future of microgrids and that they will evolve to play a bigger role in property developments.
She says that: “In the future, local microgrids could connect to each other so that developments could buy and sell electricity to and from each other in times of need or surplus to avoid drawing from the National Grid.
“Whatever form a microgrid takes, there are benefits to such systems. Microgrids help overcome the inefficiency of distributing power over a larger distance.
“It is estimated that up to as much as 15% of electricity dissipates in transit, so by having the power generated close to the area being served, this issue is greatly reduced.”
Cost-effectiveness
Microgrids may indeed be cost-effective, especially after considering the cost and likely delays of connecting to the national grid.
There are restrictions that developers need to be aware of; namely that any microgrid on a residential development needs to be operated by an IDNO.
However, it is possible that microgrids – or at least the potential for their future development – could become compulsory.
“It is currently a Section 106 requirement to ensure developers leave capacity for and safeguard a route for future connection to combined heat networks, subject to the costs being viable,” says Irvine. “We might see similar rules being inserted relating to microgrids.”
So, while microgrids might be some way off being mainstream in the UK, it looks likely that they will play a growing role in property developments in the future.
This article was originally published by Property Week on 21 September 2023 and can be read here (behind their paywall).
Forsters acts on acquisition of part of Royal Albert Dock, Liverpool
5 June 2023
News
We are delighted to announce that members of a multi-disciplinary Forsters team have acted for a joint venture between developer General Projects and investor Neo Capital on the acquisition of part of the Royal Albert Docks in Liverpool.
The acquisition, reported in BBC News, was part funded by a loan from Merseyside Pension Fund.
The iconic, 375,000 sq ft mixed use asset forms part of the largest single collection of Grade 1 listed buildings in England. The joint venture plans to evolve the dock into the “most exciting experiential and authentic destination in the UK”.
Jacob Loftus, chief executive officer of General Projects, said: “We are honoured to have become custodians of one of our country’s most significant landmarks and one of its most magnificent examples of industrial heritage.”
Commercial Real Estate Partner, Katherine Ekers, who led the Forsters team, said: “This is a fantastic project on a sensitive site of national importance. We look forward to working with Neo Capital, General Projects, Merseyside Pension Fund and others to progress the ambitious, exciting plans for the next phase in the history of the dock”.
Partner and Head of Banking & Finance, Victoria Edwards, said: “It was great to be part of the multi-disciplinary team at Forsters with banking and property working side by side on this terrific asset.”
Shorter, faster, better, stronger – Andrew Crabbie speaks to IREI
1 June 2023
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Partner and Head of Commercial Real Estate, Andrew Crabbie, has featured in Institutional Real Estate, Inc.’s latest piece on how an increase in flexible leases will drive up innovation, rental income and standards across every conceivable metric.
Due to the disruptive and unpredictable nature of the last 25 years, almost all industries have been gripped by a continuous sense of uncertainty.
In relation to real estate, one trend to come from this is the movement towards shorter and more flexible tenancy agreements. Crabbie explains that due to this desire for flexible tenancies (primarily from SMEs), landlords have increased the amount of turnkey space they offer.
“Increasingly, landlords are providing letting deals where the landlord is doing the basic finishing works to the building – and the full cat-b fit-out. So the tenant just walks in. This is 100 percent in line with the tenant requirement for flexibility and the need to transact swiftly.”
The article goes on to clarify how landlords enabling a “plug-in-and-play” solution to tenants also benefits them, allowing them to charge higher rent in exchange for immediate occupancies and landlord responsibility for dilapidations at the end of the tenancy.
This article was originally published by Institutional Real Estate, Inc. on 1 June 2023 and can be read in full here (behind their paywall).
Evolving industrial and logistics sector finds reason for optimism – Victoria Towers speaks to Property Week
26 May 2023
Views
Commercial Real Estate Partner and Co-Head of the Industrial & Logistics group, Victoria Towers, has spoken to Property Week on Forsters’ survey, conducted for our recent ‘Outside the Box‘ campaign, on current market sentiment within the Industrial and Logistics space.
Towers says: “Investors are confident of long-term occupier demand and of overcoming construction risk as inflation peaks.
“So much is changing so quickly, and the sector is definitely having to adapt more than it has previously. The sector is innovating and continues to show resilience.”
To find out more about our ‘Outside the Box’ campaign and explore the statistics learnt from our survey, click here.
This article was originally published on 12 May 2023 by Property Week and can be read here (behind their paywall).
Why the logistics sector is under pressure to evolve – Victoria Towers writes for React News
26 May 2023
Views
Commercial Real Estate Partner and Co-Head of the Industrial & Logistics group, Victoria Towers, has written for React News on the evolution of the logistics sector and how owners are pushing to innovate and meet sustainability goals.
Towers writes that “[Forsters’] recent Outside the Box study of the expectations of investors and developers in the [industrial and logistics] sector confirms our own experience as lawyers in advising on our clients’ innovations. Multi-storey formats, renewable energy and integration with residential require legal and technological support.”
From the survey, we saw that the greatest consensus was on multi-storey sheds. “77% believe they will play a large role in the UK logistics sector in the future and 52% have seen an increase in developer appetite in the past year.”
The key driver for this is the competition for land, with all that’s missing a confidence in the resilience of this new multi-storey shed format. “Are there cost-effective structural engineering solutions and ways around a vehicle stuck on a ramp? Are goods lifts now reliable enough?” Regardless, Towers says we should expect to see a proliferation of warehouses, light industrial units and the occasional 20-storey tower.
“In the meantime, lawyers will develop the legal structures needed to ensure that a multi-tenanted, multi-storey scheme remains attractive to both tenants and investors.”
The co-location of residential and urban logistics is causing issues in relation to design, technology and legal rights, with classic NIMBYism in play.
The solution will most likely lie with technology, which will also improve prospects for planning. Key forms of technology raised in our survey include clean energy, modernised site infrastructure, air filters and quieter HGV engines. There is also particular optimism for the impact of e-commerce, robotics (67%) and EV charging.
The real cause for excitement is, however, the impacts expected from artificial intelligence. Towers explains that “automation has required tighter legal controls on landlords to avoid them marching in on an inspection and getting in the way of a robot. As we start to see the uses emerging for AI we will get a clearer sense of the legal principles no longer fit for purpose and the gaps in regulation.”
Missing link
Battery storage has been a particular source of debate. Industrial real estate is becoming increasingly power hungry, and the “broad, flat roofs of our sheds are a gift for photovoltaics.”
“Battery storage is the missing link. The industry needs the capacity and ability to retain the energy generated by photovoltaics. If the panels produce excess energy, it is wasted should the National Grid not buy it back and there is nowhere to store it.
“The innovations we have discussed so far could have a big impact on the efficiency, value and deliverability of industrial real estate. But there could be a more disruptive change in the pipeline.”
Towers goes onto highlight the environmental incentive of shifting from road to rail, with particular reference to HGVS. This sentiment is shown in our survey with many anticipating rail freight generating the greatest growth in occupier demand in 2023.
“The picture that emerges is of a sector that is far from complacent in surfing the continuing wave of strong demand and high values. The industrial real estate sector is conscious of pressure to transform its environmental performance, and is investing in the innovations that will deliver a cleaner and more efficient industry.”
To find out more about our ‘Outside the Box’ campaign and explore the findings of our survey in detail, click here.
This article was originally published on 22 May 2023 by React News and can be read here (behind their paywall).
Forsters advises Fiera Real Estate UK and Cubex on the acquisition of a 2.6 acre development site in Bristol
27 April 2023
News
Forsters has advised Fiera Real Estate (“Fiera”) and Cubex on the acquisition of a 2.6-acre site in Filton for the proposed development of a new 75,000 sq.ft Grade A urban logistics scheme with a GDV of £20m. The scheme is expected to complete in the second quarter of 2024.
The site was purchased through the Fiera Real Estate Logistics Development Fund UK (“FRELD”). All assets in FRELD’s portfolio will meet the rigorous environmental and social requirements set out by FRE UK’s Sustainable Design Brief, which align with its ambition to drive positive change and contribute to a low carbon economy. The scheme has had ESG considerations embedded at all stages of its design process and along with future projects for the fund, it will be targeting net-zero carbon construction, BREEAM Excellent and EPC A.
The site is situated in the Filton area of Bristol, which is already a prime industrial location and in close proximity to the M4, M32 and A38. It was previously occupied by Rolls Royce before being acquired by St Francis Group and is the last remaining plot of the Horizon 38 development, which already hosts several investment grade occupiers.
Joe Downey, Managing Director at Cubex, commented “I absolutely love this site. Filton is undoubtedly the best-connected location in Bristol for urban warehousing. The immediate area is home to some of the largest aerospace and defence companies in the world, and the neighbouring Brabazon development will create an entirely new neighbourhood with thousands of new homes.”
Chris Button, Fund Manager at Fiera, added, “We are super excited to be funding another high quality and sustainable development with Cubex and have immediate appetite to invest a further £250m.”
Commercial Real Estate Partner Jade Capper, assisted by Senior Associate Charlie Croft, advised on the deal.
Shaking the foundations – Andrew Crabbie Maria Shahid and the Law Society Gazette
9 December 2022
Views
Head of Commercial Real Estate, Andrew Crabbie, has been extensively quoted in Maria Shahid’s latest piece, originally published by the Law Society Gazette, on how the uncertainty and fragility of the UK’s real estate market is being mitigated by a “wall of capital” from overseas.
The low down
The UK commercial property market is struggling. That is not unprecedented, but the sector’s challenges are much less straightforward than during the boom-bust economic cycles of the past. Property lawyers cite war in Ukraine, Brexit and ‘Trussonomics’ as complicating factors. Lawyers remain hopeful that after months of political turmoil, planning reforms may finally get under way, but geopolitical uncertainty and rising interest rates are twin headaches. Bargains abound for overseas buyers, as distressed assets and a weak pound present big opportunities. Or they would do if owners were not hanging on, apparently in denial about taking a ‘haircut’ on their investments.
Tumbling commercial real estate valuations and sales seem to signal a slump. But talk to commercial property lawyers at the sharp end of transactions and a more complex picture emerges. There is plenty to keep them busy, but often that is not good news for clients. The Gazette canvassed the sector’s specialists on how they are juggling the multiple challenges they face – from war and Covid to the legacy of ‘Trussonomics’.
Problems are multiplying
Crabbie commented: ‘We are only two years into a decade in which we have already experienced Brexit, Covid, the conflict in Ukraine and escalating climate change, which have accelerated political instability and economic downturn.’
Kwasi Kwateng’s notorious ‘mini-budget’ in September had a tangible impact, he adds: ‘After the chaos of “Trussonomics” and the resultant turmoil in the debt and gilt markets, it is unsurprising that major real estate investment deal activity has stalled.’
Kate Topp, partner and head of real estate at Ashfords, concurs: ‘Since the mini-budget we’ve definitely seen what I would call a slowing of transactions,’ she says. ‘I haven’t personally experienced anything becoming abortive but of course residential developers are having to take stock given the rising cost and general availability of mortgage finance.’
Boyes Turner partner Mark Appleton also points to overlapping problems for the real estate sector. ‘The property market has been hit by various factors: the war in Ukraine resulting in increased energy prices, rises in the cost of living and inflation, together with an ill-conceived mini-budget and political instability resulting in interest rate rises and a diminution in the appetite to lend on property transactions,’ he says.
Brexit effect
Can you form a clear picture of events while they are still unfolding? That is difficult, but on Brexit the challenges do not stop people from trying.
Ray Oshry, partner and head of commercial real estate at Harold Benjamin, sees little change in that respect. ‘To be honest, we haven’t noticed much impact at all from Brexit,’ he says. ‘In fact, we as a firm are busier than ever across the board. The reality is that everything in commercial property has been overshadowed by the pandemic, the war in Ukraine and the cost of living crisis, and their impact. This has had a significant impact on certain types of commercial property such as leisure and retail, and we are still experiencing the after-effects of that today.
‘If not for the Covid-19 pandemic, we may have noticed the effects of Brexit to a greater extent. It is likely we will feel some of the effects in the years to come, but it’s currently still a case of let’s wait and see.’
There is a more immediate effect on development work, notes Stephen Hedley, partner and head of real estate at Cripps. ‘The main impacts post-Brexit are supply-chain delays and cost pressures on development projects coupled with labour and skills shortages,’ he explains. ‘The pandemic and other global events compounded these issues and challenges remain, and in many instances are more acute. The significant impact on construction projects continues.’
Irwin Mitchell’s national head of real estate Adrian Barlow also highlights post-Brexit construction challenges. ‘The shortage of materials and labour remains an issue for our developer clients that has been exacerbated by Brexit,’ he says. ‘Developers are looking for flexibility with construction timescales in contracts and the ability to reduce prices to take into account rising construction costs. Interest in advice on drafting contracts has therefore never been higher.’
Topp confirms this: ‘Unfortunately, the availability and cost of mortgages is not the only challenge – the rising price of materials and issues in the planning system continue to impact on all developers, but particularly the SMEs.’
What about commercial tenants’ response to Brexit? Barlow says: ‘We have also found that tenants are looking for more flexibility in response to the rising cost of doing business. The “regearing” of leases to introduce breaks and rent concessions is particularly common – again bread and butter income for property lawyers.’
Post-pandemic bubble has burst
Hedley says: ‘For the wider commercial real estate teams the post-pandemic investment bubble has burst.’ Global and political events have led to a slowdown in these transactions. ‘Although we are still seeing healthy levels of interest in UK property from inward investors from the Middle East, far east and elsewhere in Europe… it’s clear some are holding back in anticipation of further price corrections.’
‘Covid has resulted in poor occupancy rates – about half of the pre-Covid rates,’ Boyes Turner partner Mark Appleton notes. This has led to surplus space which owners and occupiers are trying to sell or let. ‘As a result, investors have sought to take money out of property funds and place it elsewhere. Such funds may be forced to sell assets under value to plug a financial hole.’ It is reported, he notes, that Landsec accepted £809m from Lendlease for the Deutsche Bank building on Moorfields, London, compared with the original price of £1bn. ‘Things do not bode well when the UK property market made its worst ever return [in October],’ he adds.
Covid’s cottage industry
Irwin Mitchell’s Adrian Barlow says dispute resolution remains ‘extremely busy’. He explains: ‘On the disputes side, the statutory moratorium on enforcement action by landlords for commercial rent arrears built up when businesses were forced to close due to the Covid pandemic ended on 23 September. This led to significantly increased instructions from landlords looking for advice on their options to forfeit (terminate) leases for non-payment of previously “protected” arrears and pursue payment through various methods.’
Cripps’ Stephen Hedley says: ‘The pandemic created its own Covid-specific cottage industry for dispute resolution lawyers. There was the emergency legislation restricting landlord enforcement, the developing body of case law relating to the liability to pay rent during lockdowns, and the post-lockdown Covid arbitration scheme. These matters are concluding and Covid-specific litigation will likely soon be a thing of the past.’
Barlow says: ‘Looking forward, current economic conditions suggest more work for investors with defaulting tenants, for tenants looking to reduce their rent or get out of leases, and for the parties affected by delayed or aborted development or investment projects.’
Buyers and sellers: two worldviews
‘From a land-acquisition perspective,’ Topp says, ‘there definitely isn’t the same pre-Christmas rush from a purchasing developer’s point of view to get deals over the line, rather a desire to keep things moving; but see how things pan out in the new year.’
Crabbie highlights the problems arising when buyers and sellers have misaligned expectations – understandable in a market in flux. ‘The big challenge is pricing,’ he says, ‘and the disparity between expectations on both the sellers’ side, who are naturally reluctant to be pushed into a fire sale, and the buyers’ side who are eager to identify so-called distressed assets and scoop a bargain. It is difficult to predict with any degree of certainty where pricing corrections will eventually land but, depending on the sector, values may be down 10-20% from 12 months ago.’
Will sellers accept the ‘haircut’? Robin Grove, divisional managing partner of construction, real estate and disputes at Charles Russell Speechlys, says: ‘The weight of largely private capital seeking opportunities to invest means there will be a transactional market in real estate assets, once assets have been revalued. Those needing to refinance or exit to create liquidity recognise that revaluation to the “new normal” is needed and will do so more quickly than previously.’ Therefore, he says: ‘We expect the transactional market to reboot in early 2023, not least as overseas private capital seeks to take advantage of the weak pound.’
Hedley says: ‘On the occupier side and day-to-day asset management, we see resilience with no significant downturn. This includes office occupiers as we continue to see strong demand for high-grade offices within particular locations. [In London], there is also strong demand from high-end retailers in high-end residential areas such as Chelsea and Shoreditch, but not in traditional locations such as Regent Street.’
Borrowing costs and inflation
Crabbie says the ‘real gamechangers are interest and gilt rates which are driving uncertainty. Interest rates are likely to continue to rise into the early part of next year, and I would expect them to plateau around the second quarter’.
Prices are falling. ‘On one hand we have seen a reduction in property transactions, particularly due to higher borrowing costs, rampant inflation and soaring energy costs resulting in businesses generally having less disposable income for investment,’ Barlow says. ‘Clients are in some cases battening down the hatches and preparing for the impending recession… all of these factors have reduced the demand for commercial property, causing property prices to fall and clients seeking to withdraw from deals or looking to “chip” the price on property acquisitions.’
Conversely, Barlow says, ‘many clients are seeing excellent opportunities. Some businesses are under pressure to dispose of assets due to property corrections in the market. Cash-rich clients that have the money and appetite, and that can move quickly, are therefore identifying opportunities’.
Some developer clients are hanging on to sites until development costs make ‘building out’ more viable. ‘But, in the meantime,’ Barlow says, ‘they are getting income by leasing to tenants in the leisure and agricultural sectors, with breaks that enable them to regain the site when the time is right. Similarly, in the retail sector landlords are starting to rent vacant units for temporary “meanwhile uses” such as arts and creative centres, and in some cases looking to benefit from permitted development rights and converting properties from retail to residential use. We are able to advise on all such activity.’
Attractive assets
There remains a considerable ‘wall of capital particularly from overseas… waiting to be deployed in real estate’, Crabbie says. Such investors are, he adds, ‘benefiting from the weakness of the pound. I think we will see the return of good old-fashioned real estate asset management to create value enhancement as opposed to relying on a low-interest-rate regime. The fundamental of right location with strong tenant demand’.
In an inflationary environment, Crabbie says: ‘Rented residential, hotels and student accommodation will be attractive sectors. With the fundamentals of logistics remaining strong, retail undergoing something of a transformation and offices being at the forefront of the drive to decarbonisation and sustainability, new investor opportunities should arise.’
He remains ‘cautiously optimistic about the overall prospects for 2023 and that real estate will retain the resilience which has been its hallmark over my 30-year career’.
Clients are, Hedley notes, affected differently: ‘Where we see most activity is with clients not exposed to high debt costs.’ Activity, he says, has primarily been industrial and non-fashion retail parks. ‘Mixed-use development in major conurbations appears for now to be holding up. Lack of debt and interest rates seem to be a key issue, alongside price uncertainty. There is also still an element of political uncertainty making investors cautious.’
Jennifer Chappell, real estate counsel at BDB Pitmans, also notes that ‘the outlook for industrial sites, such as warehouses and life science labs, still remains incredibly strong.’
Cash is king
What next? Hedley says: ‘Higher interest rates and an economic downturn will inevitably see a greater focus on cashflow. For landlords this means measures to ensure rents are received. There will be an upturn in insolvency-based advice, whether in connection with CVAs, administrations or liquidations.’ Property-related professional negligence claims, he says, ‘will likely see an upturn, as is often the case in an economic downturn’.
Appleton says: ‘A nervous property market is unhealthy. These factors could easily lead to a downward spiral and ultimately a property recession unless overseas investors and wealthy funds bolster the market. Experts seem to think that any property crisis will not be as bad as the 2008 recession.’
However, he adds: ‘In the near future, there is bound to be a period of increased interest rates, a lack of demand until the economy gets back on its feet and property price readjustments.’
Topp sees a role for the state in improving the market. The planning system in particular, she says, ‘requires a good deal more investment and an increase in the number of experienced planning officers if the government is going to make any significant inroads into its new homes delivery target’.
Ending on a positive note, Grove says: ‘The office market remains an essential sector despite the changing accommodation requirements after Covid, and quality, including sustainability, is becoming ever more critical to protect asset value. Integrated teams of transactional and dispute lawyers close to their opportunistic clients will find their teams remain busy in 2023.’
This article was originally published by The Law Society Gazette on 2 December 2022 and can also be read here.
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.
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 Register of Overseas Entities: how does it apply to trusts?
22 September 2022
News
The new register of overseas entities (“ROE”) maintained by Companies House came into effect on 1 August 2022. The aim of the ROE is to record the beneficial ownership through “overseas entities” of land in the UK. Non-compliance with registration obligations will in practice make it impossible for overseas entities to buy, sell, let or charge UK land and also carries criminal sanctions. It is therefore crucial that overseas entities, including corporate trustees, are aware of their obligations in relation to the ROE.
Ready, Steady, (almost) GO! The Register of Overseas Entities is live
1 September 2022
News
The register of overseas entities managed by Companies House (the Register) is now live and accepting applications, but there is a short grace period until 5 September for the registration of land transactions. In this update we set out more detail as to the registration requirements and process and our thoughts as to what overseas entities should be doing now to ensure compliance.
The English government has established the Register with the intention of increasing “transparency”, to allow “law enforcement agencies to investigate suspicious wealth more effectively”. Essentially, any overseas entity which owns or is to acquire UK property will need to register, providing details about the entity itself and its beneficial owners. HM Land Registry will enter restrictions against the title of such property so preventing the overseas entity from entering into various property-related transactions unless it is on the Register. Failure to comply with the requirements to apply to be on the Register can constitute an offence.
Further detail about the Register and the obligations arising can be found in our earlier note on the topic (see our article here). Since that note’s publication, additional regulations have been published adding in extra layers of process.
Key Dates
The Register went live on Monday 1 August 2022, meaning that overseas entities can now apply to Companies House to be admitted to the Register.
The property-related provisions will however, only take effect on 5 September 2022. This grace period has been implemented to avoid property transactions being held up by the need to register. Its effect is that any overseas entity currently in the middle of a property acquisition which completes and in respect of which the application to register the transaction at the Land Registry is made before 5 September will not need to be on the Register in order to complete and make the necessary entries at the Land Registry. However, any overseas entity which intends to complete the purchase of any UK property and to apply to register the transaction at the Land Registry on or shortly after 5 September would be wise to apply to the Register now to ensure that the registration process does not delay completion. As from 5 September 2022, overseas entities will not be able to register a freehold interest or a lease exceeding seven years from the date of grant unless they are registered on the Register at the time the (Land Registry) application is made.
Any overseas entity which held UK property prior to 4 September 2022 will need to apply to register in any event by 31 January 2023 (i.e. six months from the Register going live). This registration obligation applies to overseas entities which became registered as proprietor of the UK property pursuant to an application to the Land Registry on or after 1 January 1999. However, bear in mind that where an overseas entity acquired UK property between 1 August 2022 and 4 September 2022, it will not be able to dispose of that property or grant a legal charge over it unless it is duly registered. (Overseas entities which acquired the UK property prior to 1 August 2022 will be able to make such a disposal without first being on the Register until 31 January 2023.)
Any overseas entity which has made a disposition of UK property since 28 February 2022 must provide details to Companies House by 31 January 2023. Where the overseas entity is obliged to register (because it still owns UK property), the details of such disposition must be provided at the time of its application to register.
UK-Regulated Agent
To register, an overseas entity will need to provide certain information about itself and its beneficial owners (or if there are no beneficial owners, its managing officers) to Companies House. Pursuant to regulations published earlier in the summer, such information must first be verified by a “UK-regulated agent”. Registration will not be possible without this verification from a UK-regulated agent. The information must be verified not more than three months before the application to register is sent to Companies House.
Service providers such as accountancy firms and law firms are among those who may apply to become a UK-regulated agent but obviously, there are responsibilities, risks and potential liabilities which also come with the position. It is to be hoped that a publicly available list of such agents will become available in due course. The verification process is not exactly aligned with the requirements of anti-money laundering regulations, so overseas entities may find they are required to provide more detailed information than is ordinarily required for transactions.
The UK regulated agent can submit the registration application with the verification statement, or if the overseas company is making the application itself, the agent can provide the verification separately to Companies House by email within 14 days of the application being made.
Verification will also be required when the overseas company complies with its duty to update its entry on the register each year.
Fee
There is a registration fee of £100 payable to Companies House.
Practical Steps
Overseas entities which: (a) currently hold UK property; (b) disposed of UK property since 28 February 2022; or (c) intend to acquire UK property, should be collating the information required to register and submitting their registration applications to Companies House as soon as possible
Acquisitions of a freehold interest or of a lease for a term exceeding seven years from the date of grant or the grant of a legal charge which are completed and registered at the Land Registry between 1 January 1999 and 4 September 2022 will not immediately be affected by the Register, but the purchaser should register as soon as possible (and must register by 31 January 2023)
Acquisitions of a freehold interest or of a lease for a term exceeding seven years from the date of grant cannot be registered at the Land Registry after 5 September 2022 unless the overseas entity is on the Register
Overseas entities must provide details of any disposal of a freehold interest or of a lease for a term exceeding seven years from the date of grant or the grant of a legal charge since 28 February 2022 to Companies House by 31 January 2023 whether or not the overseas entity in question needs to be on the Register
The disposal of a freehold interest or of a lease for a term exceeding seven years from the date of grant or the grant of a legal charge by an overseas entity which acquired the property on or after 1 August 2022 will not be permitted unless the overseas entity is on the Register
An overseas entity which acquired the property and applied to be registered at the Land Registry prior to 1 August 2022 can dispose of a freehold interest or of a lease for a term exceeding seven years from the date of grant or grant a legal charge in respect of the property before 31 January 2023 without first being on the Register, although it will still need to apply to the Register and provide details of the disposition by 31 January 2023.
Disclaimer
This note reflects the law as at 1 September 2022. The circumstances of each case vary and this note should not be relied upon in place of specific legal advice.
Climate rules increase pressure to rethink leases – Victoria Towers and Louise Irvine speak to PlaceTech
15 August 2022
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Commercial Real Estate Partner and Co-Head of Logistics, Victoria Towers, and Commercial Real Estate Senior Knowledge Development Lawyer, Louise Irvine, speak to PlaceTech about how the move to make climate reporting mandatory will obligate landlords to include data sharing clauses in future leases.
Since April 2022, the UK’s largest companies and financial institutions have had to disclose their emissions, ensuring they are in line with TCFD recommendations and, as part of the disclosure, report not only their own emissions but those of their value chain. For real estate, that includes tenants’ emissions.
As such, leases will need to evolve to enable data sharing and, as Towers explains, while we are seeing numerous developers take greater interest in the ‘green’ provisions in their leases, the challenge is including clauses that tenants are happy to agree to.
Irvine goes on to explain that in recognition of the incoming requirement to disclose emission data, landlords and tenants are discussing provisions around the energy providers tenants can use – pushing them towards a greener option.
Irvine comments: “I think [it’s] all very much being driven by knowing that they’re going to have to disclose and work towards targets quite quickly.”
You can read the article in full here, on the PlaceTech website.
Victoria Towers is a Partner in the Commercial Real Estate team and leads Forsters client facing ESG offering. Louise Irvine is a Senior Knowledge Development Lawyer in the Commercial Real Estate team.
Depth and diversification will drive logistics growth – Victoria Towers writes for React News
27 July 2022
Views
The emergence of a new sub-sector of alternative uses is providing opportunities for investors and developers.
Commercial Real Estate Partner and Co-Head of Logistics, Victoria Towers, has guest written for React News on the rapid growth of the industrial and logistics market, resulting from changes in consumer behaviour thanks to the pandemic, the adoption of new technology, and the inexorable rise of e-commerce.
Contrary to popular belief that Amazon’s apparent reining in of its growing property requirements would curtail market growth, recent research from CBRE demonstrates a 10% growth in take-up of warehouse space between the first half of this year and last, alongside a UK vacancy rate of 1.2% – a new record low.
Towers describes how such growth and confidence in the sector can be attributed to the diversity across its occupier base. Production and distribution, life sciences, and light industry are all sectors worth mentioning, whilst “data centres have [also] become critical pieces of national infrastructure, required to store and process the data by the move to cloud-based computing.”
The lack of supply and high interest in this sector will continue to fuel the meteoric rise of the industrials and logistics market, and the diversification of the occupier base means that the pace of this growth may yet accelerate further. Landlords and developers must be forward-thinking and quick-moving in order to flourish and meet this growing demand from uses which will, over time, emerge from the alternative to the mainstream class.
This article originally appeared in React News on 21 July 2022, available here behind their paywall.
Nine-month warning: Are you ready for looming climate rules?
14 July 2022
Views
Commercial Real Estate Senior Associate, Edward Glass, speaks to PlaceTech about what exactly landlords need to know about Minimum Energy Efficiency Standards (MEES) and how they can prepare for the April 2023 “crunch point” as a ban on continuing to let commercial buildings with poor energy ratings comes into effect.
Current MEES regulations prevent landlord from granting new leases for commercial real estate (CRE) spaces with an EPC rating below E. Next April, however, this ban will extend to existing leases (and by 2030, the ban is expected to extend to all properties with an EPC rating of below B; currently thought to be 85% of the UK’s CRE space).
Exemptions aside, there will be penalties for non-compliance – monetary and reputational – which inevitably has landlords worried.
As this “crunch point” approaches, and legislative thresholds are set to ramp up, Glass’s key advice for landlords is a must read.
You can read the article in full here, on the PlaceTech website.
Ed is a Senior Associate in the Commercial Real Estate team, with a specialism in ESG matters.
Where have all the good sheds gone… – Victoria Towers writes for Logistics Manager
6 July 2022
Views
You can’t find a good shed these days for what seems like love nor money – is this going to be the new ‘normal’?
Industrials & Logistics Partner, Victoria Towers, has provided expert commentary to Logistics Manager magazine on the growing supply-demand imbalance of warehouse space and the unsurprising increase in rent levels, highlighting that “we are still in a landlord’s market.”
As a result, speculative space is frequently being let during construction, prior to practical completion.
Towers adds that “with demand still very much outweighing supply, occupiers are also accepting longer leases and thought is being given to rent reviews. Rather than open market rent reviews, developers and landlords are looking at CPI rent reviews, and this is being accepted by tenants.”
The article summarises that due to inefficiencies within councils in relation to planning approvals for new developments, developers and investors are essentially taking a lottery ticket when it comes to getting their planning application approved, regardless of their scale of investment or prior experience with the system.
This article first appeared in the July 2022 edition of Logistics Manager magazine, it is available here.
Taking Off: Drones and real estate in 2022 – Louise Irvine and Andrew McEwan take part in LexisNexis webinar
30 June 2022
Views
Commercial Real Estate Senior Associate, Andrew McEwan, and Senior Knowledge Development Lawyer, Louise Irvine, recently produced a webinar as part of the LexisNexis Webinar series, covering the interesting topic of drones and how we are seeing them fit into the Real Estate industry at present.
Their conversation delves into topics such as:
the current uses for drones within real estate and beyond;
what the current legal framework is in relation to the ownership and use of airspace;
what landlords might want to consider if thinking of including drones as part of their strategy for their existing/future projects (with a particular focus on drone landing pads for deliveries); and
their view on where we might see increased opportunities for commercial drone use in future, for instance with ‘drone corridors’ across industrial sites and for urgent medical and remote area logistics.
McEwan commented: “As drone technology continues to improve, we are expecting to see more and more landowners start to consider incorporating provision for drones into their new schemes in years to come and we look forward to seeing whether the tight regulations in this area will eventually allow the industry to ‘take off’.”
Created by the Later Living sector, for the Later Living sector, ARCO’s What Next? Conference is the largest networking event for anyone working or interested in Integrated Retirement Communities. It provides a forum for introducing attendees to new ideas, concepts and trends that are likely to shape the future trajectory of the industry for years to come.
The conference will centre around discussions on what customers actually want and need, how the IRC sector can better cater for ethnic minority groups, the current reforms taking place to the leasehold system, how to address the uneven distribution of IRCs across the UK, and what the next 12 months have in store for the industry.
Laura Haworth and Lauren Melachrino to attend BPF Annual Conference 2022
14 June 2022
News
Laura Haworth and Lauren Melachrino from our Commercial Real Estate team will be attending the BPF Annual Conference 2022 at London’s Cavendish Conference Centre on Wednesday 15 June.
They will join leading players in the real estate industry for an all-important discussion focused on sustainability and the action needed to accelerate the transition to a net zero real estate sector.
A major new initiative – the BPF Net Zero Pledge – is set to be launched during the conference, to help drive the decarbonization of the built environment.
Forsters are committed to running a business that is environmentally sustainable: We continually strive to minimise our impact on the environment and have years of experience of incorporating sustainability considerations into the legal advice that we provide to our clients.
Laura Haworth is a Senior Associate in the Commercial Real Estate team and has a keen interest in ESG matters and renewable energy. Lauren Melachrino is an Associate in the Commercial Real Estate team and a BPF Futures member.
Learn more about our firm’s green credentials and carbon neutral status here and via our sustainability hub.
Forsters advises Fiera Real Estate and Wrenbridge on purchase of £33m ESG Exemplar Industrial Scheme in Portsmouth
31 May 2022
News
Forsters has advised Fiera Real Estate (‘FRE UK’) and Wrenbridge on the purchase of a 4.5-acre site in Portsmouth for a £33m ESG Exemplar Grade A industrial scheme.
Commercial Real Estate Partner Victoria Towers and Senior Associate Paul Grayson advised on the deal, which aims to obtain planning permission for seven industrial units ranging from 6319 sq ft to 29785 sq ft.
Sustainability and wellbeing considerations are central to the proposed scheme, which is targeting BREEAM Excellent and an EPC A rating. It will offer high efficiency heating and cooling systems, water-saving fixtures and fittings and PV panels will be fixed to all buildings. During construction, the scheme will promote the use of locally sourced goods and low-emitting carbon materials, as well as ensuring that the contractors are part of the Considerate Contractor Scheme.
Will Jarman, Associate Director at Wrenbridge commented: “we are delighted to secure this prominent site in Portsmouth and view this transaction as the first of many within a strategic push towards the M27 corridor on the South Coast. We are in discussions with occupiers on pre-lets as we plan to bring forward a highly sustainable scheme to the area. Wrenbridge and Fiera have significant capital to deploy into the industrial and logistics sector across our key geographies, with the South Coast now also firmly in focus.”
The post-Covid high street – Andrew Denye speaks to New London Architecture
9 May 2022
Views
Commercial Real Estate Partner and Head of Retail, Andrew Denye, talks to New London Architecture Curator-in-Chief, Peter Murray OBE, about the challenges and opportunities for the Retail sector and what the post-Covid high street might look like.
A current member of the NLA Expert Panel on Retail and Hospitality, Andrew discusses how the retail industry is in the process of ‘bouncing back’ from pandemic conditions and what might be in store for the sector, with particular reference to the changing nature of the high street, flexible use, and community hubs.
The full interview is available to watch and listen to here.
The UK Logistics Market, A Gift That Keeps On Giving – Victoria Towers speaks to Logistics Manager
6 May 2022
Views
Despite the UK experiencing its deepest recession for 300 years, the industrials and logistics property industry has been enjoying a surprising period of growth.
Industrials & Logistics Partner, Victoria Towers, has provided expert commentary to Logistics Manager magazine on this welcome rise in demand for the sector, describing how Forsters“has seen rent levels in London go up from £17.50 to £24 per square foot (an increase of 37%) in ‘a matter of months.'”
“You are not going to see that kind of growth in offices [or retail at the moment].”
An interesting aspect of today’s market, she adds, which is contributing to the rise in rental prices, “is that some of the big players cannot get their foot in the door and so are pairing-up with developers on the ground and pursuing off-market deals.”
Victoria explains that many investors look to avoid open market sales in which they may be outbid, and so are acting quickly to prevent such competitive situations.
This article first appeared in the May 2022 edition of Logistics Manager magazine, it is available here.
Forsters has advised Fiera Real Estate UK (“FRE UK”) and Wrenbridge on the sale of a 33,000 sq. ft. urban logistics unit in Park Royal, London
22 April 2022
News
The property was purchased from Wrenbridge and Fiera Real Estate’s Opportunity Fund V UK, a programmatic venture series with CBRE Global Investment Management.
The asset, which is currently let to a cosmetics wholesaler with a lease expiry in December 2022, was purchased by Vengrove for VRE Industrial Partners (VREIP), its UK value-add industrial and logistics strategy. It is VREIP’s first acquisition in London, as it seeks to assemble a regionally balanced UK portfolio.
Chris Button, Fund Manager at FRE UK, commented “We are delighted to have completed on the sale of this high-quality asset, located in the midst of London’s logistics hub. Fiera Real Estate has considerable funds to commit to sites with similar features around the UK.”
Commercial Real Estate Partners Smita Edwards and Jade Capper advised on the deal. Stonehill also acted on behalf of FRE UK and Wrenbridge. Vengrove was advised by Levy Real Estate, Dentons, Hollis and Nova Ambiente.
Landlords under threat as clamour grows for rent controls: Helen Streeton speaks to React News.
19 April 2022
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Scotland and England have vowed to bring in rent controls and mayors in England are lobbying for the same power.
With the long-term effectiveness not yet proven, there are concerns over the impact of such measures on the supply of rental properties if regulation were to increase, and fears that it could result in landlords “voting with their feet”.
Commercial Real Estate Partner and Head of Build To Rent, Helen Streeton, spoke to React News about what this could mean for the Build To Rent sector:
“Build To Rent developers faced with dwindling returns could also decide to shut up shop. It happened with the Buy to Let sector… When the government abolished interest relief on mortgage payments, a lot of people just withdrew from the market”.
Whilst suggesting that the government could “provide a rent subsidy to tenants or incentivise developers to build more houses by giving them a tax break”, Helen admits there would be a “time lag between introducing a tax break and tenants seeing reduced rents”.
Property industry eyes will be firmly fixed on Scotland to see what happens next…
This article was first published in React News on 14 April 2022 and is available to read in full here, behind the paywall.
Q&A: Five minutes with Andrew Crabbie, Head of Real Estate at Forsters, speak to Property Week
8 April 2022
Views
Head of Real Estate, Andrew Crabbie, spoke to Property Week on how he got started in property, his book and podcast recommendations, the celebrity he would most like to meet and his number-one travel destination.
Andrew said “I have spent my career in a fascinating industry that continues to evolve, inspiring and challenging us all – never more so than in present times.”
The article was first published on Property Week on 7 April 2022, and is available to read in full here, behind the paywall.