Jamie Statham

Today we published the CBRE UK Property Investment Yields for September 2024. We reported no change to yields as a pick up in deal volumes anticipated by many following the recent base rate cut is still awaited. A sector by sector summary is below. If you are interested in subscribing to our monthly yield publication or wish to discuss this further do reach out. Retail - Yields remain resilient for sub £5m lot sizes in prime locations. Secondary remains asset specific. Out of Town Retail - New opportunities awaited post summer as most existing stock now spoken for. Industrial - Most activity with multi let estates and opportunities where reversions are attractive. Offices - Slow pick up in transactions as stronger interest in larger lot sizes is awaited. Long Income - More stable yield categories as confidence improves. Hotels - No change in yields, however investment activity continues to gather pace fuelled by portfolio deals. Both the CBRE IP and Valuation teams are currently very active with significant mandates. Residential - Market continues to trend stable, with improved investment volumes anticipated following recent base rate cut and announcement of new Government. Student - Strong demand for the most prime properties, but purchasers pushing for meaningful discounts on non-core assets not meeting all best-in-class requirements.

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A chartered surveyor investor has instructed me on an interesting review concerning an equity sharing ground rent. If you don’t know what “equity sharing” means, it’s when the freeholder owns the land and the tenant builds the property and sublets iit. At each rent review, the freeholder gets a percentage of the market value of the sublets assuming vacant possession. In this lease the formula for the review is the proportion that the initial rent bears to the market rent. When the client bought the investment at auction the particulars said that the surveyors who’d dealt with the previous review had agreed x% for the proportion. However the freeholder’s solicitors said that as the percentage was not recorded in a legal document it did not set a precedent. So the freeholder wants a higher percentage. The dispute wen to court which has ordered the parties to each instruct experts to interpret the lease and provide reasons for the proportion and an opinion of rental value for the review in question. I’m told the judge thinks the initial rent is a proportion of the rent the tenant received from the subletting. But with respect to the judge I don’t agree. The rent would have been fixed when the lease was completed which was before the tenant built the property and sublet it. So the first time a proportion could have been calculated was at the first rent review. Early days. If anyone has been involved with something similar then please contact me direct, thank you.

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Monday Market Review: Key figures & findings from the last seven days: Catch up on all the latest movements and commentary in less than five minutes, featuring data and analysis from Savills, Knight Frank, Property Vision, the OBR, Nationwide, UK Sotheby's International Realty & more...

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The next Business Rates Revaluation will come into effect on 1st April 2026 and will result in large changes in rates payable.   In order to forecast the effects on the office sector in Central London, we have produced an interactive heat map to illustrate the predicted changes for the London Office market. The 2023 List rateable values have been compared to the projected 2026 rateable values for the 20 London sub-markets.   To find out more visit:   https://lnkd.in/e35tNrCY Bjorn Bowles, Keith Cooney, Carla Eckhardt, Emily Woodhams, Nick Bell, James Turnbull #CRE #BusinessRates #BRRC26 #Revaluation #LondonOffices

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The beginning of 2024 has been relatively quiet in terms of investment deals closing, following a flurry of transactions at the end of the previous year. There has been a mixed outlook on development activity. While completions have been on the rise in 2023 due to slowing build cost inflation, starts have decreased compared to completions. This indicates that investors are focusing more on existing projects rather than starting new ones. However, the number of homes in construction and permission stages shows promise for starts and completions in the future. These upcoming schemes will be crucial in addressing local housing needs, as our analysis indicates that many Build to Rent (BtR) movers come from the same or nearby areas. Our research also reveals that tenants are more willing to move to BtR properties compared to other forms of Private Rented Sector (PRS) housing. This highlights the appeal of BtR schemes to renters beyond just the opportunity to live in a new home. The main challenge moving forward is to address the bottlenecks in the delivery pipeline in order to meet the high demand. For more information, visit:

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HANOVER PLACE | BROMLEY | BR1 **SALE LAUNCHED**   An exciting opportunity to acquire an exceptionally well-connected Greater London landmark property with strong development and repositioning potential. 🎯 Hanover Place offers a unique opportunity to acquire an exceptionally well connected mixed-use investment in Central Bromley. 🎯 Bromley is the main commercial hub for the prosperous Greater London Borough of Bromley. The property is situated within a 2-minute walking distance from Bromley South railway station which benefits from 18-minute access into London Victoria. 🎯 Highly prominent high street location with The Glades Bromley close by and the bustling High Street. 🎯 Striking landmark property totalling 85,727 sq ft (NIA), reflecting 104,278 sq ft (GIA), arranged over two ground floor retail units and four upper office floors. 🎯 Large site area of approximately 1.28 acres (0.51 hectares). 🎯 Multi-let to three office tenants and two retail tenants, providing a WAULT of 3.11 years to expiries and 0.90 years to breaks. 🎯 The property is currently 45% let (excludes the Wilko Retail Limited lease) and produces a rental income of £627,868 per annum, equating to £7.32 per sq ft overall and £24.33 per sq ft on the let office space. 🎯 Excellent town centre car parking ratio with decked car park providing a 1:609 sq ft ratio. 🎯 Positive historic planning pre-application to establish the principles of developing the site, which was supported by the Council. 🎯 Short to medium term redevelopment potential - proximity to commuter station and nearby conversions providing precedent for potential repositioning options including residential, BTR, co-living, senior-living / retirement care, data centres, hotel and self-storage (subject to planning). 🎯 Freehold. Offers are sought in excess of £12,000,000 (Twelve Million Pounds) subject to contract and exclusive of VAT A purchase at this level reflects a low capital value of £140 per sq ft.   For further information, please contact Alex Youell, or myself. #cbrecapitalmarkets #realestateinvestment #investmentopportunity

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Todays GreenStreet news leading article - mentioning again last weeks Urban Splash Residential Fund X Citu deal Reeves’ budget has also come in for criticism, with the £40bn tax hike and £30bn increase in borrowing savaged in the national press. Since Wednesday, UK 10-year Gilts have traded at around 20 basis points higher. For those who believe what the chancellor says, Reeves is stuck between a rock and hard place: wanting to spur investment, while plugging a pretty hefty funding hole. Yet the last seven days saw not just the announcement of a new £200m partnership between Urban Splash and Citu to deliver 600 single-family housing in Yorkshire, but also a £750m tie-up between Greykite and Gatehouse to build 2,500 homes around the country.  For those with ropey maths, that’s £950m invested into house building, and, following on from the news that CPP Investments and Howard Kennedywere planning to invest £1bn through a new single-family joint venture the week before, that means nearly £2bn in total.  It’s exactly the kind of investment the cash-strapped government wants: institutional cash, increasing house building, supplying a new tenure, at no cost to the exchequer, providing relatively affordable homes.

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GET THE DEETS OF THE LATEST SAVILL’S UK HOUSING MARKET UPDATE. 🌱 House prices holding steady with forecasted growth 📈 Mortgage rates on the rise, but buyer confidence is up 🏠 Booming rental market with impressive growth 📈 Get the full scoop here: https://lnkd.in/es4ZKkma

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The good news for anyone tired of Budget speculation is that the end is in sight. After nearly four months of uncertainty and falling consumer confidence, the government will reveal its plans next Wednesday. The number of offers made on UK properties below £2 million fell 5% in the year to September, Knight Frank data shows. Meanwhile, the equivalent fall above £5 million was 18%. Stamp duty on sales above £2 million accounted for 22% of the £11.7 billion raised last year, which is something the government may want to consider as it puts the finishing touches to its Budget. We know about VAT on private schools from January, but uncertainty also surrounds the taxation of private equity funds and pension tax relief rules. Rumours of a capital gains tax increase have caused some nervousness among landlords, but latest media reports suggest the rate for second homes will remain unchanged. The taxation of non doms has also generated headlines and is one reason for the recent hesitancy in super-prime property markets. Foreign Investors for Britain (FIFB) has encouraged Labour to widen its proposals by introducing a so-called Tiered Tax Regime (TTR). Under the proposed scheme, individuals would pay an annual amount based on their net wealth, which in turn would protect them from UK taxation (including inheritance tax) on overseas income. An Oxford Economics survey found that 98% of non doms would accelerate their emigration plans under the current proposals, a figure that would drop to 13% if the TTR was introduced. It estimates the current regime could therefore cost the government up to £1 billion by 2029/30. How much could the TTR raise instead? Expect a number in the billions to be announced this week. Well, the waiting is nearly over … let’s see what happens…..

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📢 Breaking Down the Recent Stamp Duty Increase in the UK: What It Means for Investors and Tenants The UK property market has taken a significant turn with the recent stamp duty surcharge increase for additional properties, now rising from 3% to 5%. While this policy aims to cool competition in the market and support first-time buyers, it brings notable implications for property investors and tenants: 🔑 Impact on Residential Property Investment - Higher Entry Costs: Investors face increased upfront expenses, with stamp duty on a £250,000 property rising from £7,500 to £12,500. - Strain on Yields: This additional cost challenges profitability, particularly for buy-to-let investors in areas with moderate yields. - Reduced Supply, Rising Rents: Fewer investors may enter the market, shrinking rental stock and likely pushing rents higher, compounding housing challenges for tenants. 🌍 UK Stamp Duty Remains Globally Competitive Despite the increase, the UK still offers relatively affordable tax structures compared to global markets: - Australia: Foreign buyers face over 5% stamp duty plus surcharges depending on the state. - Singapore: A staggering 60% Additional Buyer’s Stamp Duty (ABSD) applies to foreigners. - Canada (Ontario): Foreign buyers pay a 25% Non-Resident Speculation Tax. The UK remains a favored destination for international investors, with its robust market fundamentals, strong rental demand, and regeneration projects offering long-term growth potential. 💡 Investor Strategy in a Changing Market This shift calls for a strategic approach. Exploring regions with higher yields, regeneration zones may offer solutions to navigate these changes. Let’s connect to discuss how you can adapt and thrive in this evolving landscape. The UK property market continues to present unique opportunities for those prepared to leverage them. #UKProperty #StampDuty #PropertyInvestment #RentMarket #GlobalProperty

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The independent commercial property consultancy Knight Frank has found that rents on prime offices in #Edinburgh have risen at their fastest rate since 2015. Average rents reached £43 per square foot at the end of 2023, compared to £28 in 2014 and £40 in 2022 (a year-on-year increase of 8%). "Rents for prime offices in Edinburgh have risen at a significant rate in the last 12 months," said Andrew Hill, lease advisory partner at Knight Frank Scotland. "A big contributor to this has been the flight to quality we have seen since the Covid-19 pandemic, with occupiers favouring quality space in prime locations, with good access to amenities. At the same time, there has been very limited supply of stock coming through and that has put upward pressure on rents for in-demand properties.    “With so little in the development pipeline and a lot of existing office space being repurposed for other uses, the grade B and C properties are also holding up well. There is a particular lack of stock in the city centre for smaller suites of below 5,000 sq. ft., which is one of the main contributing factors to rising rents in these markets.    The vacancy rate for new grade A office space in Edinburgh city centre stands at just 0.4%, while the vacancy rate for second-hand grade A space is 6.7%.

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I was delighted to contribute to CBRE's "European Flex Office Market Update H1 2024". Specifically, I discussed the transaction at Ingenuity House in Birmingham, which was arranged by CBRE between TSB, Orega and the Landlord. Highlights of the report include: ▶ Market Activity: Transactions in the flex office space have risen by 14% and desk volumes by 22% over the past year, despite a quiet traditional leasing market, highlighting a shift towards more flexible office solutions. ▶ Sector Dynamics: The TMT sector remains dominant but is now closely followed by the financial and professional services sectors, indicating wider acceptance of flex solutions. ▶ Management Agreements: Increasingly, businesses are choosing management agreements for greater flexibility and reduced capital outlays. ▶ Challenges and Opportunities: Valuation issues persist with flex spaces, but improving data transparency may boost the market's stability and appeal. Thank you to the team at CBRE for compiling this detailed and useful report. #Flex #MarketReports #Insights

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The beginning of 2024 has been relatively quiet in terms of investment deals closing, following a flurry of transactions at the end of the previous year. There has been a mixed outlook on development activity. While completions have been on the rise in 2023 due to slowing build cost inflation, starts have decreased compared to completions. This indicates that investors are focusing more on existing projects rather than starting new ones. However, the number of homes in construction and permission stages shows promise for starts and completions in the future. These upcoming schemes will be crucial in addressing local housing needs, as our analysis indicates that many Build to Rent (BtR) movers come from the same or nearby areas. Our research also reveals that tenants are more willing to move to BtR properties compared to other forms of Private Rented Sector (PRS) housing. This highlights the appeal of BtR schemes to renters beyond just the opportunity to live in a new home. The main challenge moving forward is to address the bottlenecks in the delivery pipeline in order to meet the high demand. For more information, visit:

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A large and stable Institutionally owned private rental market has to be part of the short and long term solution to the UK's housing needs. At abrdn we are huge believers in the BTR market and the provision of quality service and amenities within buildings that help to create communities, as exemplified by our joint venture partners at John Lewis Partnership and the exciting new homes we will be bringing forward together. As with all tenures of housing though, to truly make a difference to housing supply and for the sector to reach the levels of Institutional ownership and liquidity it has in other countries, we also need to widen our outlook. Modern management systems and good design allows us to also invest into a leaner rental product that still provides excellent quality and certainty of tenure to tenants. As investors and developers we should be looking at the breadth of where we can invest as well as deepening our exposure in the more established areas of the market. Green Street News were kind enough to let me talk about this subject in more detail in the attached article. #housing #BTR #living

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Savills revised forecast expects house prices to grow 2.5% in 2024 (revised from -3.0% as forecast in early November 2023), and 21.6% by the end of 2028 (revised from 17.9%). This is primarily due recent falls in the cost of mortgages, as well as future expectations. Property Beyond Sport John T. Andy Butts #ukproperty #propertypredictions

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Our latest UK real estate market views - April 2024: - Market hanging on interest rate news, with first cuts now not expected until August/September - Investment volumes remain very weak; Q1 was the slowest start to a year since 2009. - Office values continue to slide; M25 values down further than GFC. West End most resilient. - In contrast, Industrial and Retail Warehouse values appear to have stabilised. - PMA forecasts imply that most sectors have bottomed out, except regional offices and weaker shopping centres/high streets.

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According to Nationwide, house prices increased by 0.4% in May, bringing the annual growth to 1.3%. After two months of price declines, this rise in monthly growth indicates that the market has been able to withstand the high borrowing costs. However, price growth is expected to remain limited until there are further reductions in mortgage rates. Despite a slight increase in swap rates, mortgage interest rates have remained relatively steady in recent weeks. While this stability has provided some comfort to buyers, lower rates will be essential to stimulate more demand in the market. See more:

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