Good morning,
Goldman Sachs is one of a number of investors eyeing the property assets of wounded pension funds. UK pensions have been selling off illiquid assets since chancellor Kwasi Kwarteng’s mini-Budget sparked turmoil in the markets, forcing them to raise cash urgently. “It’s absolutely an opportunity,” said Gabriel Möllerberg, managing director at Goldman Sachs Asset Management.
The move comes after a second week of turmoil on the markets, during which the UK has replaced Germany as Europe’s most distressed country for the fortunes of corporates. And real estate has risen to become the second most distressed sector, behind retail.
Meanwhile, growth in the mighty services sector has stalled, according to September’s PMI. The UK stands on the precipice of a recession.
Fitch has followed S&P putting the UK’s credit outlook to “negative”(£), despite maintaining its AA- investment-grade credit rating.
But don’t get too gloomy. The RICS has brought in a diverse panel of smart people to help search for a chair of the board and a director general. EG’s editor asks: is this the start of the new RICS?
WeWork’s UK revenue more than halved in 2021 as tenants chose to work from home.
And homeowners are set to spend the highest percentage of their income on their mortgage in decades after the average rate on home loans exceeded 6%.
In other news, former Foxtons COO Patrick Franco will take over as chief executive of Notting Hill Genesis from Kate Davies.
HBD has lodged plans for Neighbourhood, its £130m, 414-home scheme in Birmingham’s Jewellery Quarter.
Sirius Real Estate has refinanced a €170m slab of debt a year early, extending the expiry but raising the cost.
Noatum Logistics has taken a 15-year lease on 230,000 sq ft at Biggleswade’s Symmetry Park.
And Scotland’s ministers are staying silent on whether King Charles III sought exemptions to its rent freeze bill using crown consent powers.
The UK can learn a lot from India’s best buildings, if it is to avoid the “Emerging Property Catastrophe” of EPCs, writes Ecolibrium founder Chintan Soni.
And Custodian has appointed JLL as its ESG adviser.
In this morning’s podcast, EG talks to Kadans, JLL, Barts Health Trust and MedCity about the future of life sciences in London. Which is the better formula for success, competition with other cities or collaboration?
And finally, eyebrows have been raised at an apparent demotion for the post of housing minister. Previous housing ministers have been ranked as ministers of state, making them second only to cabinet ministers. However, Lee Rowley, the latest to hold the office, is only a parliamentary under secretary of state, which is one tier lower and the most junior of junior ministers. Quite a come down from the days before the coalition government, when the housing minister attended cabinet. Since 2010 the only housing minister to attend cabinet was Esther McVey, who held the post for less than eight months between 2019 and 2020. Perhaps it is simply an oversight, rather than a deliberate downgrading of the entire sector. But you would have thought Rowley would have noticed the change. After all, being a minister of state tops up the MP’s £81,932 salary by a handsome £31,680. Being a paltry PUSS only adds £22,375. But perhaps this is merely an attempt to “trim the fat” and balance the books. When Michael Gove was levelling-up secretary, there were three ministers of state and two parliamentary under secretaries at DLUHC. Now there is just one MoS and four PUSSes. That’s a saving of £22,610 a year!
