As businesses struggle with rising occupancy costs and Bull fears for the future of the St Bride's Tavern, Bull & Bear discuss the thorny issue of Business Rates.
They look at the implications of the draft 2023 Rating List, which is due to be published shortly, and the unanswered policy questions facing the Government ahead of the Autumn Statement.
Enjoy your Sunday.
Following its recent opening, Bull and Bear meet up to discuss the re-modelled Battersea Power Station and the wider Nine Elms Opportunity Area. From an unloved industrial wasteland, it is now arguably London’s fastest growing and most vibrant residential and business district.
Despite the transformation, the area could be regarded as being ‘an international investor’s playground’, where regular Londoners have been pushed to the edge or cut out of the picture altogether. Lots of expensive flats lie empty.
The Power Station scheme will eventually house 4,000 homes and over 3m sq. ft. of commercial space. Occupiers including the likes of Apple will be taking occupation in the coming months.
This vast scheme demonstrates that the redevelopment of major urban areas can be both forward looking and sympathetic to its history.
Enjoy your Sunday.
Warning! This publication contains information and charts that some readers may find distressing.
Bull and Bear are steering well clear of this week's political shenanigans.
They are bemused as to why the latest house price figures are still rising when buyers are having to tighten their belts.
The share prices of the leading house builders have tanked this year and this may offer an insight into the coming fortunes of the residential sector.
They conclude that even if house prices do fall, there will continue to be good investment opportunities in the Build to Rent sector.
Enjoy your Sunday.
As property investors focus their attention on 'best-in-class' offices, Bull and Bear discuss what the office of the future will actually look like.
They focus on the links between office design, employee well-being and productivity.
From helter-skelter style slides between floors, to indoor basket-ball courts and gondola-shaped meeting rooms, it is clear that the concept of the office is evolving fast!
Enjoy your Sunday.
Bull and Bear meet up to discuss the UK housing market, which is experiencing price reductions, sales falling through and rocketing mortgage rates.
Warnings of further downward pressure on house prices have been all over the media this week. Some independent analysts and agents, including the likes of Knight Frank, are predicting that average house prices will fall by at least 10% over the next two years. This, however, would only push house prices back to levels that were recorded in May 2021.
The average two-year fixed mortgage rate is currently 6.16%, the first time it has topped 6% in fourteen years. The average five-year fixed year rates stand at 6.07%. For homeowners currently locked into some of the lowest mortgage rates but with their deal ending soon, the future looks pretty bleak.
The shortage in housing supply, strong labour market and the recently announced changes to stamp duty will, hopefully, help reduce the overall impact.
Enjoy your Sunday.
After a decade of Bull calling the shots, it is now time for Bear to have his turn in the limelight.
The turmoil of the financial markets is taking a heavy toll on the property market.
Higher interest rates and gilts yields are heavily impacting on both property companies and the institutions alike.
No-one will be unscathed so long as the Bank of England and the Chancellor of the Exchequer are at odds with each other. Something (or someone) has to give.
A fall in capital values is now inevitable. The only question is by how much. Predictions range from 10% to 20%.
Enjoy your Sunday!
In the aftermath of Friday's "not-so-mini" budget announcement, Bull and Bear debate the new PM's economic ideology.
They pick through some of the detail of the Chancellor's "Growth Plan" and assess the market's immediate reaction.
They conclude that this huge fiscal stimulus will likely provide a shot in the arm to a faltering economy, but that this radical shift is not without risks in the longer-term.
Enjoy your Sunday.
After an historic week for the country, Bull and Bear meet up to discuss the ongoing challenges students are facing and they debate the state of the Purpose Built Student Accommodation (SBSA) investment market.
Thousands of students who are meant to be starting courses imminently are being left stranded without accommodation.
According to UCAS, nearly 426,000 students held university offers on 18 August 2022, the second highest on record.
The private student accommodation rental market has shrunk significantly in recent times, not helped by the increasing legislation for Houses of Multiple Occupation (HMOs).
Sentiment in the sector has been buoyed by its resilience throughout the COVID pandemic and the current strong investor interest in the sector is expected to be maintained.
Bull and Bear unite in expressing their sadness and condolences at the death of HM The Queen and express their gratitude for her dedication and steadfastness, not least as the Patron of the RICS.
Bull has been infatuated by the research findings of (the late) Dr Hans Rosling in Factfulness from which he has concluded that we are overly influenced by the media’s persistent barrage of bad news.
Despite all the current negative prophesies on the economic, financial and geo-political fronts, Bull sees no reason to be deflected from his indomitable upside perspective on life.
Bear is unconvinced. Yet even he accepts that the current softening of property yields is almost certainly not a sign of an impending apocalypse.
On the back of a study by CBRE entitled 'The Value of Green Building Features', Bull and Bear discuss the evidence and its implications.
They discuss whether green premiums can actually be quantified and whether the risk of inaction by investors could ultimately leave buildings obsolete.
The conclude that, at the very least, investors need to implement sustainability measures to protect the value of their assets.
Enjoy your Sunday.
After returning from their summer holidays, Bull and Bear meet up to review the latest UK property news.
According to Savills, five sectors reported outward yield shifts of 25 basis points in July, up on the three in June, bringing their average prime yield to 4.88%.
The preliminary July monthly investment volumes figure of £2bn is the weakest since August 2020 and down from a monthly average of £5.4bn during the first six months of 2022.
Rental levels for best-in-class office space have continued to rise over the summer.
According to Penfold, the average price of a London pint could climb to a staggering £13.98 by 2025. Really?
As the world’s population is about to pass eight billion, Bull and Bear consider the ramifications of the UN’s latest demographic predictions.
The UN reckon that on 15 November 2022 the global population will pass eight billion. If we all held hands, we would wrap around the Earth three hundred times!
The global population is expected to reach 9.7 billion by 2050. More than half the projected increase will be concentrated in just eight countries.
The additional 10 million people who are going to be living in the UK over the next twenty-eight years is the equivalent to another London and Birmingham combined.
The share of the global population aged 65 years plus is expected to rise from 10% to 16% by 2050. In the UK, it is even higher.
In the aftermath of the heatwave, Bull & Bear examine what the property industry can do to reduce carbon emissions and play their part in mitigating the impacts of climate change.
They discuss measures to reduce both operational carbon emissions and embodied carbon, as the industry strives to achieve the much-feted "net zero" targets set by the Government.
For once, they seem to be largely in agreement!
Battling against the ongoing heatwave, Bull and Bear meet up to discuss the London office market and explore whether it should still be on investors’ buy-lists.
According to Remit Consulting, office occupancy in Central London was only 29.3% in the middle of May.
Both Savills and CBRE have recently increased their prime City office yield from 3.75% to 4.00%. Prime West End Office Yields remain at 3.25%.
Asian Pacific investors have been the most active on the buy-side this year for City offices, whilst over in the West End, North American investors have been the most active buyers by volume.
