James Bannister FRICS’ Post

The Labour Party has won an overwhelming victory in the UK general election. With only a few seats to be declared, Labour had won 412 (+211) with the Tories at 121 (-250), and the Lib Dems at 71 seats (+63). Office for National Statistics reported a higher revised GDP growth figure for Q1 2024 of 0.7% (vs 0.6%). S&P Global’s purchasing managers’ index (PMI) for the manufacturing sector registered 50.9 in June, down from May’s 22-month high of 51.2. The PMI for the services sector fell to 52.1 in June, with the fall likely due to election uncertainty. Calastone reported property fund outflows of £48m in June. £7.6bn in outflows have been recorded since 2016. BNP Paribas Real Estate reports that UK PBSA investment soared to £1.7bn in H1 2024 – a 245% increase on the £493m recorded in H1 2023. abrdn has acquired the Tandem Centre retail park in Colliers Wood for £60.8m, while Aviva Investors has purchased Brunel Retail Park, Reading for £26.4m and Greenridge has bought the Waitrose & Partners & John Lewis At Home unit on Futura Retail Park, Ipswich for £21.9m, reflecting a NIY of 8.1%. Frasers Group has bought the Frenchgate Shopping Centre in Doncaster. M&G Real Estate is to sell-down the remaining £300m of assets held in its frozen UK retail fund, while abrdn Property Income REIT is exploring a £400m portfolio sale. NewRiver REIT plc has acquired Ellandi for an initial cash consideration of £5m which adds 16 shopping centre asset management mandates. Over the past 20+ years solar panel efficiency has increased from 10% to nearer 25%, driving down costs. Perovkite-silicon tandem cells deliver high performance through capturing long and short wavelengths, while Bificial panels capture direct and reflected sunlight. New lightweight and flexible panels are allowing far wider application. Mark Charlton – Real Estate Research Consultant at Waypoint #waypointAM #RealEstate #BTR #PBSA #ESG #Debt #CapitalMarkets

We have just published our Q1 UK BTR Market Update. A few key highlights: - UK BTR investment hit £1.3 billion in Q1 2024, up 21% year-on-year and the strongest first quarter on record. - Investors continued to up their exposure to different subsectors, with Co-living accounting for 20% of deals by value. - Investment into London has bounced back, with 52% of Q1 BTR investment flowing into the capital, compared with 23% in 2023. Viability challenges are easing and a softening in yields has given investors more confidence on pricing and return metrics - There are 110k complete BTR homes in the UK, accounting for just 1.9% of the private rented sector. Projected population growth means the sector has a challenge on it's hands to increase this percentage. The annual pace of delivery of BTR homes would have to double from 14k per annum to 28k per annum to reach 5% market penetration by 2030, equating to 300k complete homes. - Build cost inflation has been moderating, down to 3.1% in 2023, from a peak of 15.5% in 2022, according to BCIS. Inflation in material and labour costs is likely to be close to zero for the next year or so, which will support viability and reduce pressure on margins. - Annual BTR rents rose by 4.7% in the to February 2024, which reflects a return to more sustainable levels of rental growth following the peak of 15.4% in 2022. Download the full report here: https://lnkd.in/eY_YvRgV Knight Frank, Oliver Knight, Nick Pleydell-Bouverie, Guy Stebbings, Jonathan Stevenson, David Shapland, Irene Marin Pastor, Samuel Gibb #buildtorent #BTR #multifamily #singlefamilyhousing #coliving #sfh #residentialinvestment

Office of National Statistics reported that the UK suffered a shallow recession at the end of 2023 with GDP falling by 0.3% in Q4 2023 following a 0.1% fall in Q3. All three sectors recorded reduced output: services (-0.2%), construction (-1.2%, and production (-0.1%). CPI remained stable at 4.0% in January, helped by lower prices for household goods, food, and non-alcoholic drinks. Core CPI rose 5.1% y/y, down from 5.2% in December. Q4 2023 regular pay growth fell to 6.2% from 6.7%, above the Bank of England’s forecast of 6%. Citra Living Limited (Lloyds Banking Group) has bought 558 houses across the south of the UK from Guy Hands’ Annington Homes for c. £150m. Lidl GB is seeking £90m to forward fund 12 UK sites. The guide price of £91.15m reflects a net initial yield of 4.25%. Tritax Big Box REIT plc and UK Commercial Property REIT have announced a possible merger that would create the fourth largest UK REIT based on market capitalisation, at £3.9bn. Trafford Council has written its largest-ever development loan to provide £71m towards Moorfield Group’s £170m Lumina Village residential project in Old Trafford - 440 apartments and townhouses with a GDV of £120m. The Ingenious Group has provided a £25.25m development loan to the JV between Zenzic Capital and Torsion Group for a 183-bed PBSA development Leeds. Fred Done Property Trading Group has provided a £185m debt facility to Salboy and Gary Neville’s Relentless Group for phase two of St Michael’s, a £400m mixed-use scheme in central Manchester. The Body Shop (UK) has appointed administrators (FRP) to restructure the business. It has more than 200 UK shops. Job losses and store closures are likely. Housing Secretary, Michael Gove, has announced a £3bn plan to build 20,000 affordable homes. Critics warn that this won’t touch the sides of the crisis. Mark Charlton - Real Estate Research Consultant at Waypoint #waypointAM #Retail #RealEstate #BTR #PBSA #Debt #Finance #CapitalMarkets #Housing #Research

  Office for National Statistics reports that a monthly increase in activity in the construction sector (+1.1%) and services sector (+0.2% overall) prompted a 0.2% jump in GDP in January 2024, suggesting that the technical recession of Q4 2023 is history. Essentially, the economy is flatlining. Office for National Statistics data for annual pay growth including bonuses averaged 5.6% between November 2023 and January 2024, lower than the 5.8% expected. Excluding bonuses, the figure was 6.1% compared to 6.2% previously. The labour market appears to be loosening, which may encourage an early base rate cut.   Retail parks worth c.£100m have hit the market, including Tandem Centre, Colliers Wood (LSIM) for c.£56m / 6.5%, Mercantun Way, Colliers Wood (Aviva) for £25m, and Southampton Road Retail Park, Salisbury (Lothbury Investment Management Limited) for £25m. FPG Property Fund, the South African investor, has bought the second phase of Peel Retail and Leisure’s Washington Retail Park for an undisclosed sum. Apollo Global Management, Inc. has launched its first dedicated European real estate debt fund, targeting €1bn in commitments. M&G Investments has raised £350m at the first close of its latest real estate debt fund. Morrisons parent company Market Topco reported a £1bn loss last year as debt interest payments related to its PE takeover soared to £735m. Legal & General Investment Management (LGIM) is under offer to buy two PBSA blocks in Exeter (312 beds) and Glasgow (399 beds) for more than £120m. Redevco has launched a new urban living strategy to develop around 10,000 affordable housing units over the next 5-10 years in Europe. LDC reports that restructuring and administrations last year led to 5,000 fewer shops now trading across the UK. New openings (9,138), dominated by fast food and coffee shops, were outstripped by closures from high profile collapses such as wilko, Paperchase and LloydsPharmacy. Mark Charlton – Real Estate Research Consultant at Waypoint #waypointAM #Research #BTR #PBSA #CapitalMarkets #Retail #RealEstate #Developments

The UK Autumn Statement featured a total of 110 “growth” measures facilitated by lower-than-expected inflation. Highlights include an £11 billion full expensing tax cut for businesses investing in machinery and a 2% cut to national insurance from January 2024.   Business rates are being frozen for the smallest companies and the 75% discount on business rates up to £110,000 for retail, hospitality and leisure businesses is being extended for another year. So, still no fundamental reform for a tax that is not fit for purpose. Gloomy forecasts from the OBR suggest that UK GDP will grow by 0.7% in 2024 and 1.4% in 2025 - down from a previous forecast of 1.8% and 2.5%. Inflation is not expected to reach the Bank of England’s 2% target until 2025. S&P Global reports that the November PMI for UK came in at 50.1 vs an expected 48.7, indicating a marginal return to growth. UK Services rose to a 5-month high of 50.5. LXi REIT PLC is closing in on a £210m sale of 66 Travelodge Hotels Limited. Shaftesbury Capital PLC has abandoned plans to sell a portfolio of properties in London’s Fitzrovia district after bids reportedly fell short of expectations. M&G Real Estate is lined up to buy an 11-store £130m portfolio of @Waitrose stores being sold by John Lewis Partnership (JLP). The net initial yield is understood to be c. 6%. Modular housing developer TopHat has agreed a £15m loan with Homes England. This will enable it to scale-up production as it draws closer to opening Europe’s largest modular housing factory in Corby in 2024. PGIM Real Estate is understood to be in negotiations to buy Project Jade, a £200m portfolio of 10 PBSA (4,335 beds) assets being sold by Unite Students.   Mark Charlton – Real Estate Research Consultant at Waypoint   #waypointAM #RealEstate #Development #Debt #Finance #Business #Retail #CapitalMarkets

Economy Update: UK's Economic Outlook & Housing Policies Autumn Statement Highlights - Chancellor Jeremy Hunt introduces premium planning services for faster decisions, met with skepticism from experts. Office for Budget Responsibility forecasts slower growth, higher unemployment and persistent inflation. Housing & Policy Shifts - Michael Gove accelerates funding for housing schemes, signals new NPPF release. Suggestions to balance green belt expansion with urban green space improvements. Residential Trends - Banks cut mortgage rates to boost property market. Savills forecasts trends in Midlands' property market. Built-to-Rent (BTR) Sector Insights - Surge in single-family rental housing investments. Savills notes robust BTR activity, investor appeal and key industry deals. Commercial Sector & Construction Challenges - LondonMetric reports positive half-year results; restaurant and logistics sectors show growth. Challenges in construction - Building Safety Act's uncertainties and a sharp decline in new house starts in London. Construction Challenges - New house starts in London drop by 74% in Q3 2023 compared to historical averages. #UKeconomy #HousingMarket #RealEstateTrends #PropertyInvestment #BTRmarket #EconomicForecast #ConstructionChallenges #PolicyShifts #FinancialOutlook #UrbanDevelopment

“I am seeing a tsunami of investment and debt funding targeting the living sector, primarily international funding dominated by the US, Asia and the Middle East,” shares Head of Residential Capital Markets at BNP Paribas Real Estate - UK, Andrew Screen. “The supply of suitable residential development opportunities is not increasing substantially, however investment demand is. With this massive amount of money looking to invest in the sector, my view is that not everybody's going to get a deal.” 🔹Ahead of his participation at the upcoming GRI Beds Europe 2024 on June 27th in London, Andrew gave an exclusive interview to GRI Club, thoroughly addressing the current scenario of the UK’s residential sector, including PBSA and office conversion. After a year of exceptionally low transaction volumes, Andrew describes optimism seen among investors for this year, however “everybody's waiting for the trigger”. That trigger could be one of four things, Andrew continues to explain, political certainty post elections, economic certainty post interest rate reductions, pricing certainty as transactions pick up, or a large portfolio transaction from a first mover. 🔗 Read the full interview with Andrew Screen on the GRI Hub here: https://lnkd.in/dknXj49Z #griclub #realestate #residential #uk #investment

“I am seeing a tsunami of investment and debt funding targeting the living sector, primarily international funding dominated by the US, Asia and the Middle East,” shares Head of Residential Capital Markets at BNP Paribas Real Estate - UK, Andrew Screen. “The supply of suitable residential development opportunities is not increasing substantially, however investment demand is. With this massive amount of money looking to invest in the sector, my view is that not everybody's going to get a deal.” 🔹Ahead of his participation at the upcoming GRI Beds Europe 2024 on June 27th in London, Andrew gave an exclusive interview to GRI Club, thoroughly addressing the current scenario of the UK’s residential sector, including PBSA and office conversion. After a year of exceptionally low transaction volumes, Andrew describes optimism seen among investors for this year, however “everybody's waiting for the trigger”. That trigger could be one of four things, Andrew continues to explain, political certainty post elections, economic certainty post interest rate reductions, pricing certainty as transactions pick up, or a large portfolio transaction from a first mover. 🔗 Read the full interview with Andrew Screen on the GRI Hub here: https://lnkd.in/dknXj49Z #griclub #realestate #residential #uk #investment

🏠💼 The Unsung Heroes of the UK Economy: Landlords 💼🏠 A groundbreaking report by PwC, Paragon Bank, and the National Residential Landlords Association reveals the massive impact of landlords on the UK's economy. 🚀 Here's how they're building more than just homes: 🌟 £45 Billion Contribution: Equivalent to the total GVA of Kent, landlords are foundational to our economic structure. 🏡 3.8 Million Homes: Representing 80% of the private rented sector, small and medium-sized landlords are key players in the housing market. 🛠️ 390,000 Jobs Supported: From real estate to construction and beyond, landlords are pivotal in job creation. 📈 Economic Expansion: A 10% increase in the rental market could introduce an additional £4.5bn in GVA and 39,000 jobs. Landlords are not just providing homes; they're fueling the economy, enabling job creation, and enhancing our communities. Let's recognize the value they bring to our society and discuss how we can support the growth of this vital sector. 💬✨ #marvelsuccessworldwidelimited #property #propertyinvestment #realestate #UKPropertyDeals #AsianInvestorMarket #UKPropertyDeals #AsianInvestors #InvestmentOpportunities #BuildingTrust #RealEstate #GuideBook #SuccessStories 

The SA investment market continues to see high demand from both local and interstate capital seeking accelerated returns on the back of zero stamp duty and a positive yield spread. The industrial and alternate sectors lead the way with non-discretionary retail assets not far behind. We expect to see transaction volumes increase into Q4 2023 and into 2024. #jll #jllaus #capitalmarkets #adelaideproperty #industrialproperty #alternativeinvestments #retailproperty Luke Billiau Sam Hatcher Nick Willis Daniel Kernaghan Jack O'Leary Claudia Brace Simon Hilmgard Luke Duncan Caitlin Du Rieu Anna-Louise Coppock Craig McCarthy Simon Quinn Stuart Crow