London Estates - Competing in a Global Real Estate Market

07 Jun 2018

Great estates were the order of the day at the London breakfast this month, where panellists and attendees alike gathered to discuss the issue of London’s estates and their ability to compete in the global real estate market.

The landed estates prowess is clear; collectively, they manage “tens of billions in property” as pointed out by LSE’s Tony Travers in his opening keynote. While these estates seem to tower above the uncertain market forces acting in London at present, they still had much to say about their approach to staying ahead of the curve.

The panel, made up of London Estate powerhouses Hugh Seaborn (Cadogan Estate), Steven Norris (Soho Estates), Amelia Steveley (Grosvenor Britain & Ireland), Andrew Hynard (Howard de Walden Estate) and David Marks (Brockton Capital), chaired by Judith Everett of The Crown Estate, had a lot to say about how they are planning for the future.

The panel discussed a range of topics, from the current state of the market, how their estates are differentiating themselves, the importance of thinking long-term and putting the customer at the forefront of the business strategy.

The announcement of House of Fraser’s administration that morning put retail high on the cards, with each estate attempting to show their faith in the increasingly uncertain and fickle sector. Steven Norris, chairman of Soho Estates added that the increasing prevalence of retail chain administration was not a worry for him: “We don’t want any of the normal high street brands, we want interesting independents…the future Paul Smiths and Vivienne Westwoods – not Nexts…how do you keep an area special? Ensure you’re edgy not sleepy.” This was seemingly reinforced by Soho’s absence of CVA claims.

Andrew Hynard defended the place of physical retail: “We have recently brought two online brands into the physical, some retailers are going from clicks to bricks…they need something to bring their brand to life and ensure their name is in front of consumers.” Hynard’s remark references Cadogan’s approach to ensuring that they are creating a community with different layers of activity by mixing residential and retail with great food and drink.

Further dispelling doubt in the London market, David Marks of Brockton Capital cited that “there is still an appetite for London and post-Brexit Britain, but it needs to be marketed in the right way, taking advantages of new trends.” Another of Marks’ remarks referred to potential false economy created by compiling red tape – “Factors such as land value capture and 106 agreements are all great ideas in isolation, the worry is that together that may disincentivise developers.”

Amelia Steveley highlights the importance of the consumer further: “A common trend we’re seeing is that tenants are expecting more service than product. We are investing significantly in the retail sector, focusing on providing the best services to tenants rather than giving them more products.”

Like any investment group, it is clear there are challenges ahead for the Landed Estates, but they are determined not to rest on their laurels. The estates are an anchor for London, ensuring stability in challenging times.