Olympic Gold!!

Our friends at MoveHut (www.movehut.co.uk) have an interesting insight on the impact the London Olympics is having on commercial lettings.  Jodee Redmond blogs:

“With the anticipated influx of visitors expected during the upcoming Olympic Games in London, space is at a premium. Landlords, including commercial property ones, are getting creative to help meet the demand for space. Temporary tenants are not being especially picky at present, and landlords are prepared to rent out all available space during the Games.

The city of London is expecting 11 million fans, athletes and sponsors to arrive in what is already Europe’s second-most crowded city next month. The huge increase in population means there is an increased demand for temporary shops to carry clothing, souvenirs and other items, as well as storage facilities. Media outlets require good vantage points for television cameras, which means landlords have the opportunity to make some money from what had previously been nothing more than dead space.

The Games will run from 27 July – 12 August. Homeowners who have space to rent have already anticipated the increased demand for space by increasing their asking price by up to six times the normal rate. Commercial landlords are also increasing the rates of their asking prices.

In Beijing and Athens, events were either held in outlying areas or neighbourhoods were demolished to create venues specifically for the Games. Most of the sites where events will be held during the London Summer Olympics are in built-up areas.

A former limestone quarry near the Bluewater shopping centre in Kent, southeast England is being offered for hire to contractors looking for temporary staff accommodation during the Games. The site is located close to a high-speed rail link, which means that anyone staying there can travel to the Olympic Stadium in Stratford in a very reasonable 30 minutes.

Empty shops are in high demand in anticipation of the Games, and ones which are situated close to popular shopping areas like Oxford Street and Covent Garden do not last long. Retailers are arranging to rent these spaces to open temporary shops to sell items like high-end clothing during the Games. Depending on the size of the space and its location, landlords are charging anywhere from a few hundred to £20,000 to rent a store which may be open anywhere from one day to two weeks.

The closer an available building is to the Olympic Park, the more a landlord will be able to charge for rent during the Games. Rather than thinking about what the space is currently used for, now is the time for commercial property owners to be creative about what they can offer a prospective tenant and how much occupying the space would be worth during the 2012 Summer Olympics.”

Not sure about that 11 million figure, but we know a lot of people are coming and the opportunities for property owners in the east of London are significant.

Anyone fancy taking August off!!

See the original blog here: http://bit.ly/MXgL6T

Social Media - Are You LinkedIn?

Social Media will continue to be big news in 2012.  As more people get to grips with their online presence and more businesses realise the potential for a new string to their marketing bow the battle for dominance in the social media marketplace will heighten.

There are over 200 social media platforms in existence and their individual customer bases are hard fought and hard won.  Many business professionals use LinkedIn (www.linkedin.com) to profile themselves, their experience and expertise as well as that of their businesses.  LinkedIn is sometimes referred to as the “FaceBook for business” which is a point of view, not necessarily one I would subscribe to, but it certainly has similar aims and allows users to have a similar experience.  With over 10 million users, (I don't know how many property professionals are on!) it is certainly worth considering your usage of this medium.

Many come to LinkedIn from a fairly low start point in terms of familiarity with social media, and “tweaking” the application and your profile can make all the difference to your experience.  Here are my top 5 tips for improving your profile:

  

1. Profile picture: no matter how camera shy you may be, having your picture on your profile does make all the difference!  It should be appropriate to what you do and should also reflect who you are and, who you are now.  A 20 year old photo of you might look good and be your personal favourite, but isn’t going to hit the spot when someone meets you face to face!
2. Connection strategy: A tough one! Some people take the view that more is better, some becoming a LION (LinkedIn Open Networker) connecting with as many people as possible (some have 1,000s of connections) with a view that, at some point in the future there may be a useful contact in there somewhere.  Bit of a needle in a haystack approach.  Others prefer to make solid contacts with people they have met, already know have been recommended to or by and build a smaller base of known connections.  It comes down to personal preference, but leveraging your connection base is a key LinkedIn functionality.
3. Testimonials: A key descriptor of your worth to potential clients is the strength of testimonials on your profile.  You can ask for these, either specifically or reciprocally, and the way you approach this is dependant upon your relationship with the individual.
4. Headline: Your headline is the first thing that a potential client, contact or referrer will see.  LinkedIn will automatically default to your last job title, which might be fine, but does that say what you would want to say about yourself?  A concise strapline describing your skills and attributes would be far better.
5. Public Profile: LinkedIn sets an automatic name for your public profile, usually a less than helpful one!  Using your Profile Edit section you can replace this with one that more accurately reflects your name.  I reset mine to http://uk.linkedin.com/in/paulwyoungman

Feel free to get in touch for further thoughts and advice on this or any of our other Bog topics.

Innovate:

Changing times call for ever more thoughtful approaches to your asset management challenges.  The current marketplace within commercial property is even more volatile than usual, and, whilst geography plays its part, the general view of the marketplace is that conditions are hard and likely to be so for the forthcoming time.

Spending time in careful consideration of the challenge this places on your business with regard to your built assets and liabilities is therefore well worth it.  In a previous post we have talked about the place within your business the build estate holds and the opportunity for the review and assessment of the estate in the light of this.

Detailed knowledge of your real estate liabilities will enable you to clearly plan ahead and, in conjunction with you business requirements, determine whether there are any opportunities to do things differently.

There may be scope to reorganise finances through the asset and balance sheet, to renegotiate terms with your landlord or reorganise loans on freehold occupancy.  Assessment of the utilised estate and how it could be improved, could allow for sub-letting (should the terms of the lease allow).  Group companies can potentially co-locate to reduce costs and vacating premises can save costs, even if the lease is still in force, with running and occupancy costs reduced to near nil and the potential for rates relief.

James Alexander Consultants are expert in assessing your portfolio and, with you, determining a strategy to develop the correct balance of assets, their relevance and performance for you.  We develop, plan and implement the strategy, leaving you to focus on core activity and opportunity.

eMail us on innovation@jaltd.co.uk or see our contact page for our numbers.  We look forward to speaking with you.

Belt Tightening in the West End:

Back in February we reported the increasing trend for the luxurious Georgian building of Mayfair and St James’s to be converted back into private residences (http://propertyforum.blogspot.co.uk/2012/02/home-office.html)

A recent report from our friends at Cushman & Wakefield now confirms this, and also raise an interesting question with regard to perceptions in these straightened times.  It would appear that now only 50% of hedge fund managers are based in the area, compared to over 70% 5 years ago.  The exodus away from the area to the more affordable and less extravagant Marylebone, Soho and Knightsbridge (really?) is continuing, they say.  With hedge funds losing 3% of their value last month alone, investors are, apparently, less impressed with the lavish offices and wish those managing their funds to have a more frugal presence.

One of the effects of this is to place upward pressure on the market in the area.  Rental levels on refurbished space in Mayfair are already breaking the £100 per sq ft level and, with a narrowing range of choice as new developments hit an all time low, there will be continual upward pressure on the limited vacant space available.

An Alternative to the commercial lease?:

A new entry into the serviced office category will open this month.  Dryland Business Club on Kensington High Street will provide high end service options for those not wishing to take on the rigours of a commercial property lease, with flexible arrangements to suit a variety of usage profiles.

Offering very high standards of accommodation, service and facilities, including usage of a chauffer driven Maserati Quattroporte, the new complex is the first of a string of centre being developed by former Foxtons boss, Jon Hunt.  Mr Hunt is bringing a new approach to the serviced office sector by making the facility more attractive to those who require the convenience of a London a base, without maintaining the commensurate overhead.  Packages start from £139 per month.

The services office sector has been progressing well for many years, with many seeing Regus as the flagbearer, and many smaller players coming into the market to address the requirements of the SME and sole trader.  From the look and style of the Kensington High Street Dryland is aiming at the entrepreneur for whom a prestige address in the West End without the hassle of running the offices themselves.  When fully occupied the facility will return approx. double the rent that could be expected under a normal rental arrangement, so not all bad!!

A second facility is expected to come on stream in Holborn at a later date.

New Working Practices:

We may have said this before, but after staff costs, the cost of the occupied estate is the next biggest expense for any organisation.

The adoption of new working practices can provide organisations with the opportunity to reduce space related overheads, as well as provide staff with options on how their work life is organised.  The opportunities to reduce the cost overhead involved in accommodation for operations are many and varied.  Their suitability for deployment is, amongst other things, dependent upon the individual circumstances of each organisation, these are not one size fits all solutions.

• Footprint:  keeping in mind the essential means of escape routes consider whether the personal footprint could be reduced.  It is recommended that 11m³ per person is achieved, but the reduction of the furniture footprint (smaller workstations) is one way which could help. 

• Working away from the Office:  technological development now means that providing essential staff with the means for mobile communication is within reach of all organisations. This does not work for all job functions and should not be taken as a wholesale opportunity to close the office, but those who are out of the office more than they are in do not, generally, need workstations.

• Technology: developments also mean that less equipment is required to provide desk top solutions for staff, coupled to a reduction in workstation size leads to smaller footprint.  Printing and photocopying devices are now available with much smarter interfaces and options.

• Maximise: have you ever wondered why the meeting and conference rooms are empty for most of the time?  Rethink the strategy and maximise usage, software packages exist to help with this.

• Open Plan:  it’s not new to suggest going down the open plan route, but think about doing away with personal offices.  Research has shown that by careful space planning, suitable provision of meeting rooms, spaces and break out areas the need for personal offices is significantly diminished.

James Alexander Consultants can help you find your way through to the best solution to your accommodation needs.

eMail us on innovation@jaltd.co.uk or see our contact page for our numbers.  We look forward to speaking with you.

Business Impact:

Does your present portfolio of occupied accommodation have a positive or negative impact on the day to day activities of your business?  It can often be the case that businesses continue to occupy and operate out of facilities long after those facilities have served their useful purpose. 

Technological change, production developments, businesses processes and changed working practices can often leave the bricks and mortar way behind in terms of usefulness to the business.  But it’s not always easy to make the change and relocate.  There are many considerations; some more tangible than others and not all business owners are able to face up to them.  It could be that the lease still has time to run, or the Company has a long standing history at the location and it is loath to break that link.  Remodelling and reworking of the workspace may be a possibility, but what if the amount of space or its geographical location is unsuitable?   

Core business activity is the key, after all, the real estate is only there to serve the business purpose, so the questions to ask revolve around the key drivers and performance indicators in the business and their ability to be achieved.  Assessment and analysis of the built environment together with the business plan and programme will help determine whether your facilities are supporting your business or the other way round.

James Alexander Consultants are expert in assessing your portfolio and, with you, determining a strategy to develop the correct balance of assets, their relevance and performance for you.  We develop, plan and implement the strategy, leaving you to focus on core activity and opportunity.

eMail us on innovation@jaltd.co.uk or see our contact page for our numbers.  We look forward to speaking with you.

Top 5 Relocation Tips:

Moving the business to new location or locations is a process best undertaken with a great deal of planning and forethought.  Commercial relocation is so much more than moving your house, its obvious isn’t it, but you would be surprised how many organisations approach this activity full of confidence due to someone having moved their own home last year, only to fail in spectacular fashion, costing the business dearly.

Here are my top 5 tips for your relocation project:

• Team:  Pull together your in house and professional team early on.  The fundamental requirement for the project team is to have delegated authority to make project decisions.  You will undoubtedly have a project Board with the overall Company authority, but the ability for the Project team to act within bounds is paramount. 

• Programme & Timing:  Your relocation project will almost certainly culminate in one or more moves over a series of weekends or a holiday period.  Planning for your project can start at either end of the scale.  Either working back from a mission critical end date, perhaps the expiration of the existing lease period, or working from the start, based on the longest lead time elements and the date you determine to launch the project.  Either way you cannot start the overall planning too soon.  Informal planning will have been taking place for some while but this needs to be pulled together at the earliest opportunity so that all aspects can be captured and detailed.

• Communication:  Early on in the project you will need to determine your communication strategy with staff and stakeholders.  As a source of rumour and misinformation, there are few better catalysts than a relocation project to stoke the fires!  Planning and implementing an integrated communication plan will greatly assist the project, both in terms of staff satisfaction and also in terms of buy in and co-operation.

• IT and Communications:  Make sure your IT and communications teams are fully engaged from the start.  We have seen projects that have started off in fine form, bringing the communications teams in at a later date, only to find there are practical technical matters that have been overlooked and the project suffers delays and cost overruns.

• Have a clear out!:  Develop time in the programme to encourage staff to have a good clear out of filing cabinets, old machinery, cupboards, loose boxes, equipment, records, files, obsolete bits and bobs and the many other things that will cost money to move, cost money to house and then cost money to move next time!  There will be opportunities to recycle, sell, donate, dispose and, in the process, contribute to the organisations corporate social responsibility agenda.

James Alexander Consultants can help you with your relocation project.

eMail us on innovation@jaltd.co.uk or see our contact page for our numbers.  We look forward to speaking with you.

Battersea Update:

Following our blog post in December of last year reporting on the difficulties faced by REO, the owners of Battersea Power Station the administrators and receivers Ernst & Young have made a significant announcement today.

Malaysian investors SP Setia and Sime Darby Property have been confirmed this morning as the preferred bidders for the 38 acre site of the old power station in south London.

An exclusivity agreement has been entered into with the Ernst & Young, with a 28 day window to conduct due diligence investigations and contract negotiations prior to going ahead with the purchase of the site for £400m.

SP Setia and Sime Darby Property said that their plans “involve the development of a sustainable multi use real estate regeneration project that will provide economic impetus for the creation of a new vibrant centre for south-west central London”.

They have indicated that they will preserve much of the façade and the iconic chimneys and have also committed to construct a new underground station, forming part of the extended Northern Line.  This move is a key initiative in the success of the regeneration project.

There is much wailing and gnashing of teeth from Chelsea supporters this morning as Mr Abramovich and Co were also thought to be in the running for a shot at redeveloping the site.  They may be off for an early bath, but you never know, things can always change! 

More news from the Pharma front:

It is understood that Allergan, the international healthcare and pharmaceutical company has commenced a search for new headquarters in the Thames Valley.  Currently located at Marlow’s International business park Allergan are said to be considering suitable accommodation in the, Reading, High Wycombe, Slough, Bracknell and Uxbridge areas. 

Cambridge Bio

A frisson of excitement ran throught the Cambridge real estate market last week as the purchaser of MEPC’s Granta Park was revealed.  US based REIT BioMed Realty Trust has secured the asset, paying a rumoured £133 million, one of the biggest single asset deals outside of London this year.

The story was broken last week in Estates Gazette (www.egi.co.uk) and, in follow up blogs, have speculated as to whom it was that represented BioMed in the deal, no names have been confirmed as yet.  The deal is expected to have been finalised just before the long weekend so the jubilee celebrations were not interrupted!!

BioMed (www.biomedrealty.com) own or have interests in assets in excess of 12.5 million ft² ($4bn +) almost entirely in the USA, specifically in bio hubs in Boston, San Diego, San Francisco, Seattle, Maryland, Pennsylvania, and New York/New Jersey.  As specialist investors and owners in this sector BioMed has an exacting specification for portfolio acquisitions and it is interesting to note that Granta Park represents one of what is believed to be a very small number of offshore assets.