Bovis builds around Brexit uncertainty
Posted by The Oracle Group on 10th July 2019 -
FIRMS
Bovis builds around Brexit uncertainty
Despite the continuing Brexit uncertainty, Bovis Homes is anticipating a marked improvement in profit for the first six months of the year. The housebuilder delivered 1,647 house completions in the six months to the end of June, up 4% from 1,580 during the same period in the year prior. A trading statement, ahead of its half-year financial report in September, revealed that average private selling prices edged up from £334,700 to £342,000 year-on-year while the total average selling price was up 3% to about £270,000. The average weekly sales rate per site jumped 15% to 0.6. The company also revealed it was now on course to score the maximum five stars in the Home Builders Federation customer satisfaction survey, up from two stars last year.
Barratt Developments will today hand some 6,000 staff shares valued at nearly £7m. The award will be given to recognise and celebrate the top five-star rating given to its homes for ten years running by the Home Builders Federation. Barratt said 200 shares will go to every worker, excluding senior management. The stock closed at 576.4p, up 1%, or 5.4p, yesterday meaning that each employee will get stock worth about £1,153. Staff are required to hold them for at least two years before they can be sold.
Tandem opens Leeds branch
Property asset management firm Tandem is expanding with a new office in Leeds. The London-based firm’s second regional office will be led by associate partners Oli Williams and Debbie Herrington, and facilities manager Simon Spensley. The team will work with national and regional clients covering assets in the North and Midlands. Mr Williams said: "There is a great opportunity to grow the Tandem business in the North with our combined skills and experience of managing commercial and mixed-use properties."
COMMERCIAL
UK commercial property struggling
Enthusiasm for UK commercial property has fallen further, as investors swing towards France and Germany. Just 27% of international professional real estate investors say the UK is their preferred market, according to real estate platform Brickvest, down 4% in the last 12 months as Brexit uncertainty continues to hurt the market. There was also a drop in the volume of assets under management that investors are planning to plough into real estate over the next year. Investors are planning to commit 2.5% of their total AUM, a drop of 33% on the planned amount of 3.7% in the second quarter of last year.
Koreans drive Edinburgh investment
Investment in Edinburgh offices in the first six months of the year has outstripped last year's annual total thanks to Korean investors. Knight Frank said a flurry of major deals in the second quarter of 2019 helped to take total investment to nearly £310m between January and June, while Korean funds have now made four major purchases in Scotland since their first transaction in 2017. Knight Frank’s Alasdair Steele said: "Despite Brexit, Scotland is seen as providing stability at a competitive price."
Harworth extends commercial land pipeline
Rotherham-based Harworth Group, which specialises in the regeneration of former coalfield and other brownfield sites, has grown its income portfolio and commercial land pipeline. Harworth has purchased Etherow Business Park in Glossop and has secured outline planning consent for its Bardon Hill development in Leicestershire, taking the firm’s consented commercial land pipeline to over 10m sq ft of space across the UK. CEO Owen Michaelson said Harworth planned further acquisitions in its core regions of the North West, the Midlands and Yorkshire.
Edinburgh's commercial property market needs new developments
Elliot Cassels, a director at Colliers International, underlines growing appetite to refurbish or redevelop older buildings in the Edinburgh office market to meet demand for quality accommodation. The office market faces dwindling supply however, he says, and expects a spike in rents as tenants compete for limited space.
HOUSING
Grainger buys London BTR development
Residential landlord Grainger has agreed to fund and acquire a 146-home build-to-rent development in London's Canning Town for £62m. The block is part of a £3.7bn regeneration scheme and will be built and developed by French construction giant Bouygues. Work is expected to begin by the end of the year and is planned to be completed by the end of 2022. Helen Gordon, chief executive, said the deal would allow Grainger to strengthen its presence in London, "one of our top target cities".
Homeowners banned from switching suppliers
New-build homeowners are being trapped in expensive energy contracts. In the new town of Cranbrook near Exeter, residents pay nearly twice as much as the cheapest available tariff, but will not be able to switch for 71 years, because the housing development gets its heat and hot water from an unregulated 'district heating scheme'. The scheme can only be run by one supplier, meaning all 2,000 homes are signed up to E.on. Suppliers of the schemes also do not have to be regulated, so their tariffs do not have to stick to watchdog Ofgem's price caps.
Call to halt Serco asylum seeker evictions
A group of charities, including Shelter Scotland and the Scottish Refugee Council, are calling on outsourcing giant Serco and the Home Office to stop issuing "lock change notices" on around 300 failed asylum seekers currently living in temporary accommodation in Glasgow. They want the action halted until the legality of the process has been clarified, amid concerns the asylum seekers' human rights are threatened. Charities and Glasgow City Council have consistently raised concerns about an imminent homelessness crisis.
LEGAL
Authorities urged to investigate bank forgery allegations
Treasury select committee chair Nicky Morgan has called on the Financial Conduct Authority and National Crime Agency to investigate alleged “industrial-scale” forgeries on court documents used to repossess people’s homes. Her intervention comes after a campaign group was set up to expose the alleged "industrial-scale forgery" of signatures by banks, which in the US has led to $25bn (£20bn) worth of fines after 4m court cases were reviewed. Julian Watts, founder of the Bank Signature Forgery Campaign, claims to have evidence showing that British banks are forging signatures on court documents and loan agreements.The Daily Telegraph, Business, Page: 3 Financial Times The Times, Page: 34-35 Daily Mail, Page: 25 City AM, Page: 6
INVESTMENT
Sheffield council’s £1bn China deal ended
Having announced in 2016 a 60-year, £1bn investment deal with Chinese construction firm Sichuan Guodong, Sheffield City Council has admitted the initiative is now "dead". A first tranche of £220m of funding was expected to finance “four or five Sheffield city centre projects over the next three years”, but with none yet brought to fruition, the council confirmed no current projects will be brought forward and "there are no future plans or projects likely to be considered" with the organisation. Yorkshire Post, Page: 1, 6 BBC News
RESIDENTIAL
Options for seaside commuters
A recent study from BMO Global Asset Management found that more than four in 10 millennial Londoners felt they would be happier living by the sea – but most assume they won’t be able to until retirement. The Telegraph, using Savills’ research, unveils some of the best seafront hotspots for those willing to take on a longer-than-average commute: Burnham-on-Crouch and Mersea Island in Essex, Broadstairs and Deal in Kent, and Brighton in East Sussex.
RETAIL
M&S warns of further closures
M&S CEO Steve Rowe has suggested that even more stores could be shut on top of the 110 closures already planned by 2020, saying the plans were “not finite”. Present plans will see 85 full-line stores and 25 Simply Food stores close their doors. Mr Rowe said its portfolio of legacy stores was holding the company back, while chairman Archie Norman said some stores should have been closed “10 or 20 years ago”. M&S is looking to make a third or more of its clothing and home sales online within the next three years, Mr Rower added.
Patisserie Valerie cuts 14 cafés
Causeway Capital, which acquired Patisserie Valerie in February, is closing another 14 cafés – with 71 loss-making sites under the Patisserie Valerie and Druckers brands having already been closed by administrators KPMG. Causeway Capital said: “The difficult decision was reached following a detailed review of the size, trading performance and location of each store over the past five months.” It said that the remaining 75 branches represented the larger, best-performing outlets.
HOTELS
Marriott facing £99m fine over data breach
The UK's data privacy regulator has said it plans to fine the US hotel group Marriott International £99.2m. The penalty relates to a data breach at Starwood Hotels that resulted in about 339m guests, including seven million in Britain, having had their personal details exposed. The incident is thought to date back to 2014 but was only discovered in 2018. The Information Commissioner's Office said that Marriott had failed to properly review Starwood's data practices and should have done more to secure its systems.
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