Commercial property people

The stories that have caught my eye in commercial property this week are, in no particular order:

Remuneration debate

Property Week ran a story about  RICS Chief Executive Louis Armstrong’s £406,000 salary.  Did readers think that it was about the going rate or too much, “particularly in a recession”.  Readers (and you) can vote by clicking the link and going to the original article.

Upturn in commercial property?

Helical Bar, the property company headed by Mike Slade, one of the most experienced operators in the business, has reported recent signs of recovery in the commercial property market in a recent statement.  Mr Slade, who has a knack for calling the property cycle, said: “We are now starting to see much improved signs in parts of the UK market, with the valuation of certain types of assets clearly levelling out. The market remains a ‘curate’s egg’ and best left to experienced stock pickers.”

CBRE feel that low  supply in London will boost recovery

A report from CB Richard Ellis suggests  that the impact of low levels of development in central London may lay the foundation for medium term rental recovery. The projected three-year average completion rate will drop well below 2 million sq ft per annum in 2012-13 which, on past form, would see office rents rising again by the time of the London 2012 Olympics.

Anatole Kaletsky downplays property market concerns

UK economic commentator Anatole Kaletsky has dismissed three of the most widely discussed threats to the property market, saying they are ‘pretty far fetched’ and often presented as ‘indisputable facts’. The three threats he refers to are fears of a sharp increase in short-term interest rates, the risk of an inflationary upsurge fuelled by the vast amounts of new money being ‘printed’ by central banks, and the perception that governments, especially in the US and UK, have borrowed so much money that some kind of national bankruptcy lies ahead. In a commentary ahead of his address to the European Public Real Estate Association (EPRA) annual conference in September, Kaletsky argues that all three risks are unfounded.

Tesco raises $90 million in sale and leaseback

Investment firm WP Carey has provided $90m in alternative long-term finance through the sale and leaseback of Tesco’s logistics portfolio in Hungary.  The finance was provided by two publicly held non-traded REITs,  owned by WP Carey. The transaction is a part of the supermarket’s chain ongoing program to release value from its property portfolio.  Tesco was represented by Cushman & Wakefield. WP Carey was advised by King Sturge.

Mike Hussey (ex-Land Securities) plans £500m fund

Mike Hussey is in early talks to set up a £500m investment vehicle to snap up undervalued property in the UK and the Continent.  The former Land Securities board director has teamed up with Neil Jones, who used to head the European division of Grosvenor, the Duke of Westminster’s property company, to work on plans for the new fund. The pair are in preliminary discussions with a range of backers, including wealthy individuals and private-equity firms, to raise £150m – which will be combined with debt to buy stakes, individual buildings and form joint ventures. The new vehicle is expected to launch in the autumn.

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