Olympic Update – Rental Mania!

A couple of weeks ago we blogged on the opportunities for private and commercial landlords to rent their premises out for the duration of the Olympics.  News comes today, courtesy of the International Business Times (http://www.ibtimes.com) that a property in Covent Garden has let for a staggering £115,000 per week.

Surely an Olympic record!!

Unfortunately, no details of the property are mentioned, the mind boggles as to what it might be!

It has already been suggested that the Opera House might be up for grabs next!

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

D is for...

Dilapidations:

There comes a point in every lease when the subject of dilapidations raises its head.  This need not be as daunting a prospect for the tenant or lessee as it may seem, however it is one that should be approached carefully.  In general terms most institutional leases will require the lessee to return the asset to the landlord at the end of the term in the same condition as they originally took it over.

However……!

Negotiation is the key.  In general terms the landlord is looking to make sure that their asset has not been adversely affected by the tenant’s occupation.  Now, being good lease abiding tenants, all clauses in the lease relating to refurbishment and alterations will have been abided by.  These usually form a requirement for redecoration on a periodic basis in longer leases and for any alterations, upgrades or refurbishments requiring approval from the landlord before proceeding.  Therefore, the landlord will know what general condition the asset will be in and, with regard to tenant upgrades and refurbishment, these will have been undertaken up to the latest regulations, so will, potentially be seen by the landlord as improvements.

If you are intending to exercise a break in the lease, your lease will determine the notice period to give, if the lease is terminating then the date will be well known. These are the ideal timeframes to commence discussion with the landlord with regard to dilapidations.  Each landlord will be different as will each situation.  Remain open to suggestion and do your best to limit your liability.

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.

Govt. Acts on Empty Homes

Easing the pressure on families who have inadequate housing should be a primary focus for any Government.  Those who are fortunate to be able to close the front door of their own home at the end of the day cannot be too grateful for this privilege.  Helping more families to be able to do this is a key objective for any society.

At a time when house building is bumping along the bottom in terms of new home starts the Government has increased its initiative to energise local councils into refurbishing and bringing back into use empty homes.

In the UK there are more than 700,000 empty homes, over 280,000 of which have been unused and under-maintained for six months or more.  Empty homes that can often attract anti-social behaviour, vandalism and fly-tipping to neighbourhoods and depress the values of other homes in the area.

Communities Minister Andrew Stunell offered £50 million Government funding to areas with clusters of empty homes which have good market prospects, such as access to transport links, but require intensive refurbishment to return them to a liveable standard.  Administered by the Homes and Communities Agency, councils who wish to apply will have to match the funding they receive - bringing the total investment to £100 million. Every successful bid must have strong local support and aim to bring at least 100 homes back into use.  Mr Stunell said:

"It's shocking that hundreds of thousands of houses sit unoccupied while people across the country are in need of a home of their own”.

Councils will also be rewarded by the application of the New homes Bonus scheme measuring the total number of long term empty properties. 

Rise in numbers of residential rental properties

The number of residential properties in the private rented sector has risen again this year.  Approximately 17%, or nearly 1-in-6 of all British houses now belong to the private rental sector, reflecting an increase of 229,000 properties on last year.

Despite mortgage difficulties the opportunity to secure bricks and mortar investments remains as quintessentially British as drinking tea.  The rise continues, fuelled by a combination of landlords buying property with cash and buy-to-let mortgages, people letting out homes they have inherited and homeowners deciding to let their property and, in some cases move into private rented accommodation themselves.