MIPIM UK 2016 | The SLC Round-Up
Brexit on the menu, PRS on the rise, and free coffee for all.
Given the British obsession with the weather, normally in preparation for a miserable wet day, there’s a certain irony in MIPIM UK being held in glorious October sunshine. Whereas, at the global MIPIM event in the rather more glamorous city of Cannes, it was dreadfully cold and wet! Ah well, c’est la vie mon amis.
MIPIM UK is in its 3rd year and is a cross sector event representing both commercial and residential property. Whilst RESI is purely a residential event and tends to be rather ‘London centric’ MIPIM is an opportunity for everyone, whether it’s institutions, agents, lawyers, developers, banks or local authorities to get together and promote themselves.
For SLC, it’s a chance to catch up with clients, cement relationships and make new contacts. And this is something we have been enormously successful at. The SLC profile in the block management and PRS sectors is as high as it’s ever been and in just a year we have representation on the British Property Federation property management board, attend and contribute to conferences held around the country and are being approached by a number of companies for our PRS debt model and consultancy services. As a result, it means when we walk through the exhibition hall we are recognised and approached by clients and potential clients alike all wanting to catch up. According to popular belief, It seems SLC are now pre-eminent in the emerging PRS, and present a professionalism in all aspects of our business that is becoming the benchmark in our industry.
But it was Brexit, and not PRS which was the hot topic at the conference. And the keynote speech, entitled ‘What Brexit really means for UK property’ set the tone. Sir Howard Davies, Chairman of RBS told the conference “We’ll see slower economic growth post-Brexit but the degree depends on the nature of Brexit” Indeed we will. But as the Government continues to vacillate, politicians argue about the legality of the ‘Royal prerogative’ and the longer-term impact of leaving the EU becomes less palatable, the exact nature of Brexit is vitally important. As Guy Hands, Chairman and Chief Investment Officer at Terra Firma Capital Partners, commented “It’s not the referendum that matters, it’s what happens next!” Aint that the truth!
If PRS wasn’t the all consuming topic at MIPIM, housing generally was. Gavin Barwell, Minister of state for Housing, Planning and London reiterated the Governments support for innovation by saying “There’s huge potential for off-site construction, driving innovation and diversification in the market.” Sajid Javed, Secretary of State for Communities and Local Government, hinted at tax changes in the forthcoming Autumn statement. Given the current unpopularity of SDLT at the moment, this was taken to mean Built to Rent would probably benefit from being exempted from the 3% surcharge on multiple ownerships and possibly, rescinding it altogether. Steve Norris, former Conservative Minister, thinks the Government should go further and rethink SDLT. He’s particularly critical of the Governments ‘attack’ on the buy to let community and feels they’ve been squeezed too hard. Since, at some point in the not to distant future, they’re going to have to compete with the institutional PRS, he’s very possibly right.
Rio Ferdinand, Bobby Zamora and Mark Noble closed day two with an ‘Up close and Personal’ interview with Damian Wild, Editor of The Estates Gazette. The trio are passionate about their Legacy Foundation – a unique project that combines residential, sport and community-led development, which aims to deliver up to 50% affordable housing. Ferdinand was in great form and brought the house down with “I don’t want to be remembered as just a good footballer … sorry, a great footballer”….
Unlike RESI, there are no late night ‘Fests’ which, since RESI is still fresh in the paracetamol soothed minds of many, is a blessed relief. Although, arch ‘Fester’ Bruce Ritchie, did lay on a splendid expresso bar at which free coffee was served whilst one could re-charge not only ones own personal battery, but also my notoriously feeble iPhone.
All in all, it was an interesting expo. I can’t say that the atmosphere was wholly upbeat, since there were clearly some reservations about how Brexit is going to affect the industry as a whole. The trouble is, no one knows and that sort of uncertainty is not conducive to promoting investor confidence.
So far, the residential market appears unaffected by Brexit uncertainty and the failings in that market are generally laid at the feet of SDLT. By contrast, PRS and Build to Rent are powering ahead. It’s expected £50 billion could be invested in the sector and the excitement generated by creating a whole new asset class is palpable. SLC are at the centre of this, and leading our industry in creating innovative solutions for the new management paradigm.
MIPIM was good for us. I hope it was good for you.