UK REAL ESTATE MARKET JOHN SLADE 1 June 2017
Agenda A CHANGING WORLD… LONDON’S BOUNCEBACKABILITY MY CAREER TAKE ADVANTAGE OF CHANGE ECONOMIC CHALLENGES BNPPRE IS CHANGING 2
1. A Changing World…
1. A Changing World – do we still expect the unexpected? 2016 was the year of the low probability event! Trump defies odds to become UK voted to leave the EU 45th US President after historic referendum Mark Rutte Emmanuel Macron Theresa May 4
1. A Changing World – Risk Index But what comes next? There are many risks … Theresa May – Trump – Middle East More severe Terrorism UK election trade wars/ downturn in Chinese economy real wars Article 50 Dutch Election French Election UK Election German Election 5
2. My Career
2. My Career Management Owned my own property company Today I am CEO of the real estate Agency/investment adviser for a broker (including changing world CBRE and DTZ) 7
. Economic Challenges
3. Economic Challenges 2007 80’s - 90’s 2016 Global Financial Crisis, Oversupply, weak economy Political, Brexit Banking led 9
4. L ondon’s Bouncebackability
4. London’s Strength & Bouncebackability I went on holiday in 2009 for end of August/beginning of September. When I came back the market had moved by 150 bps. 11
4. London’s Strength & Bouncebackability We learned through our Cycology report that London will continue to provide resilience and opportunity because of its bouncebackability …DESPITE EVERYTHING THAT I SAID • London ranks no 1 in PwC Cities of Opportunity Index – ABOUT CAUTION THROUGH BREXIT, benchmarking study of 30 leading business centres globally. Study LONDON HAS MANY, MANY OTHER ATTRIBUTES THAT WILL MAKE IT A VERY Sept 2016 SUSTAINABLE INVESTMENT LOCATION It measures cities performance against 10 indicators including • transportation and infrastructure, ease of doing business, … ALL ARE MADE PRETTY WELCOME demographics and liveability, technology readiness and cost. HERE, I THINK IT’S A GREAT CULTURE, LONDON IT’S A GREAT • Singapore 2 nd , Toronto 3 rd PLACE FOR PEOPLE TO BE AND THEY WANT OT BE HERE, IT’S WHERE THE TALENT IS.. 12
4. London’s Strength & Bouncebackability Infrastructure + Urbanisation = SMART LONDON 13
4. London’s strength & bouncebackability TALENT: London’s employment base in London is more diverse than ever FINANCE VS MEDIATECH HEADCOUNT Article 50 = speculation jobs will decrease Finance decrease, MediaTech increase Source: Experian / ONS 14
4. London’s Strength & Bouncebackability Post referendum deals Elizabeth House, Waterloo Largest office deal of 2016 – £250m, Private European Government Property Unit took 540,000 sq ft at 20 Cabot Square 7&8 St James’s Square £245m, Private Asian 15
5. Take Advantage Of Change
5. TAKE ADVANTAGE OF CHANGE Adaptable Trends Economics & fundamentals Forecasting Disjoint between investment & occupier – occupier market goes first so watch for signs 17
6. BNPPRE Is Changing
6. BNPPRE IS CHANGING 2009 2015 Atisreal rebrands to In 3 years, BNPPRE’s UK 2016 BNP Paribas Real turnover up 40% and profit 2013 • BNPPRE launches Estate at bottom of the up 200% BNPPRE recruits 50 international retail, logistics market BNPPRE announces it will directors in 12 months and occupier (GCS) develop residential in the and sets up a powerful businesses in London UK investment business What Will Happen Next? 2012 2014 • John Slade joins as CEO and BNPPRE recruits another 50 directors 2017 promises growth across retail, agency, investment and • Post EU Referendum, • BNPPRE UK launches regions BNPPRE has its best property development BNPPRE launches its first UK ever start to the year with business in the UK development scheme at King’s Cross £1bn under offer by end Feb 19
UK REAL ESTATE MARKET JOHN SLADE 1 June 2017
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