Shopping Centre Struggles

  • Following a shopping trip during half-term, Bull and Bear meet up to discuss the state of the UK shopping centre market. 

  • On the back of results released by Hammerson and Unibail-Rodamco-Westfield, there is increasing evidence that best-in-class retail space is starting to recover and that rents are growing in the right locations. But for non-prime centres, it still remains a very difficult story.

  • Although investors are increasingly seeing opportunities in the best-positioned schemes, the UK shopping centre investment market can best be described as ‘muted’, with Q1 2024 being one the five quietest first quarters in the last thirty years.

  • Enjoy your Sunday

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Future Gazing

  • After attending a talk on the future of real estate investment management, Bull is in a reflective mood.

  • The pair conclude that the need for active asset management has never been so acute, especially as the real estate landscape is breaking up into different asset types, which require specialist operators.

  • However, the inexorable trend towards investment in operational (management-intensive) sectors will also force investment managers to adopt new models to harness operator expertise and deliver an enhanced level of customer service.

  • Enjoy your Bank Holiday Sunday.

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Sweltering Singapore

  • Bull has just returned from his week in Singapore and is looking slightly worse-for-wear. Bear wastes no time in asking him how he got on.

  • Bull provides a short insight into Singapore, its domestic property market and most importantly, whether their family offices have any interest in the UK.

  • He concludes that while investors remain interested in UK property, they'd like to see interest rates come down before they give the green light to investing again. 

  • Enjoy your Sunday.

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Up, Up and Away

  • After last week's analysis of the UK's occupational property market, Bull has moved on to Part 2 of his pitch to the Singaporean investors he's flying out this weekend to meet.

  • In his pitch, he discusses the winners of St Bride's top UK Key Cities, the changing age demographics of the UK and the forecasts for Total Returns over the next few years. 

  • His conclusion is, unsurprisingly, that now is the perfect time to invest!

  • Have a happy Sunday.

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Occupational Therapy

  • Bull is heading back to Singapore next weekend in an attempt to encourage some Singaporean investors to invest in the UK Property Market.

  • Bear is interested to hear his pitch, and more specifically, what sectors he'll be recommending.

  • Bull's top picks include; London offices, London retail, South East industrials and a bit of regional PBSA and selective residential too.

  • This week he delves into the occupational story for those sectors.

  • Enjoy your Bank Holiday weekend.

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A Mortgage Review

  • The release of Liz Truss' new book has not gone down well with Bear. He still wants her to apologise to all UK homeowners for the higher mortgage rates they have had to stomach following her disastrous mini-Budget in September 2022.

  • During this week's discussion, Bull and Bear explore the current state of the UK residential mortgage market. 

  • In light of most lenders increasing their rates this week in response to market uncertainty, Bull and Bear assess what impact this may have on UK house buying and letting activity.

  • Enjoy your Sunday.

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The Ripple Effect

  • With tensions in the Middle East continuing to escalate, Bear is concerned that another regional conflict could have a negative impact on the UK economy, and the green shoots of recovery in the property market.

  • Bull agrees that the geo-political risks to the economy are increasing, but believes that the UK economic data still offers enough encouragement for the Bank of England to start cutting interest rates later this year.

  • Enjoy your Sunday.

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World Cities

  • For the first time since 2012 when the St Bride's Annual World Cities Index was launched, London has lost its crown and slipped into second place.

  • The Big Apple has claimed top spot this year, and Singapore has picked up the bronze medal. Copenhagen are new entrants into the top twenty.

  • Bull and Bear are comforted, but rather surprised, that the UK has somehow retained its silver medal position in the Environmentally-Friendly Country Index.

  • But are miserable, unhappy and gloomy that we have only just scraped into the top twenty happiest countries. Boohoo!

  • Have a happy Sunday.

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A Race for London

  • As Bull limbers up to participate in today's London Landmarks Half Marathon wearing a costume of 10 Downing Street dressed as Boris Johnson (yes, you read that correctly!), Bull and Bear discuss the current health of the London office market.

  • JLL reported that there was a rebound in office leasing activity in Q4 2023 with 3.4 million sq. ft. transacted, showing a significant 55% improvement compared to Q3 and marking the highest Q4 volumes since 2010.

  • Prime office rents increased across all Central London main markets in Q4 2023, with the prime West End office rent increasing to £140 per sq. ft.

  • Only £6.5bn of Central London office investments were traded last year but there are indications that private equity firms are now returning to the market. Their return usually signals that pricing is bottoming out and that deal volumes will pick up.

  • Enjoy your Sunday.

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Finding Purpose

  • With secondary office prices seemingly in freefall, Bull is excited by Mr Gove's ambition to deliver more homes by repurposing obsolete office buildings through Permitted Development Rights (PDRs).

  • Never one to rush into things, Bear is on hand to offer a few words of caution, raising concerns that relaxing the PDR restrictions will only lead to the delivery of sub-standard homes in the wrong places.

  • The key, as always, is striking the right balance.

  • Enjoy your Sunday.

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Fortune Favours the Brave

  • Bear is in a contemplative mood.

  • Bull is cock-a-hoop that his two predictions last Sunday for the Cheltenham festival came good. He is now officially calling the 'turn-around in the market' and reckons that the current bad-mouthing of offices has gone too far.

  • They both support the IPF Consensus Forecast of 7.2% for 2024 although they expect most of the action will be back-ended.

  • Meanwhile, they expect the listed sector will deliver some handsome returns.

  • Enjoy your Sunday.

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Property, Politics and Punting

  • Bull and Bear meet up to discuss Wednesday's Spring Budget and, in particular, the implications for the UK property market. 

  • The most relevant property announcements focused on changes to property capital gains tax, multiple dwellings relief, non-domicile tax reform, devolution of power and levelling up the economy via major developments, such as a commitment to a life sciences and homes scheme in Canary Wharf.

  • The Government also announced that it will begin legislating for the Reserved Investor Fund (RIF).

  • Bull also looks forward to his trip to the Cheltenham Festival next week and shares a couple of tips for the Weekly readership.

  • Enjoy your Sunday.

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Raving About Retail Warehousing

  • Bear is loving the new Starbucks drive-thru that’s opened up near his house, prompting the two protagonists to look into the rapid growth of the UK's drive-thru property market in recent years.

  • Bull then wonders whether this growth has been reciprocated across the UK’s wider retail warehouse sector.

  • With exceptionally low vacancy rates across the board, along with well-established retailers taking long leases and prime yields running at 6.00%, neither Bull, nor Bear, can understand why investors are waiting on the sidelines!

  • Enjoy your Sunday.

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Quizzical Insights

  • After reviewing Bull's rather disappointing showing in the annual Boost Charitable Trust pub quiz, Bull & Bear turn to the performance of the UK property market and, of course, the England rugby team.

  • They discover that the relative performance of different property funds in 2023 was, to a large extent, determined by their weighting to specific asset classes.  And that there is no stopping Scotland winger, Duhan van der Merwe, when he's running at full tilt.

  • Enjoy your Sunday.

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