EDITOR’S COMMENT Before we get going, what I’m about to talk about is in no way, shape or form anything close to a scientific or rigorous analysis of real estate’s early reaction to the first weeks of a Labour government. I haven’t even made a LinkedIn poll. But the thread weaves its way through several stories in this week’s magazine, as does the hope and optimism.
Andrew Coombs was clear. The chief executive of Sirius Real Estate, a UK and German-focused investor, came back to the market last week for its second equity raise in eight months, tapping mostly international investors for £150m from a share sale. The timing was deliberate, a week following the general election. And the reaction – a 400% oversubscribed deal – would almost certainly not have come had overseas investors not been impressed by the first days in power of Starmer, Reeves and co.
The change in government will boost investor appetite for the UK “a great deal”, Coombs predicted, particularly with the US market “increasingly more of a question mark” in the run-up to its own election.
“Investors are saying, ‘You have a stable government in the UK. The transition of power has been orderly. You have a new agenda here’,” Coombs said. “All of a sudden that seems to have switched… It’s no accident at all that we raised money the week after the election. That was always our plan as soon as an election date was named, and that was really important to the international money.”
At the City of London Corporation, planning committee chair Shravan Joshi was equally upbeat. When we sat down a week to the day after the election result, he said the new chancellor’s message about prioritising planning – which the government appears to be following through on in the King’s Speech – “really heartened us here in the Square Mile”.
“If Treasury has got an angle on how planning and infrastructure can help boost the economy, those are welcome words for us,” Joshi added. “It’s something we’ve been saying for a long time – but understanding that correlation between the two seems to get lost quite often in the noise of specific applications, or specific issues or concerns in policy. If you really want to drive economic growth, there’s a linear relationship between that and commercial real estate.”
And then there are developers. When the chancellor announced plans for a task force to “accelerate stalled housing sites”, she pointed to four projects that exemplified the kind of masterplan she meant: Liverpool Central Docks, Worcester Parkway, Northstowe and Langley Sutton Coldfield.
EG’s Akanksha Soni caught up with the private and public sector parties behind all four to get their reactions to becoming posterchildren for regeneration.
“There is no doubt that a Conservative regime which delivered 15 housing ministers over a 14-year period has left a legacy of unfulfilled promises and inertia that will need significant intervention to overcome,” said Mark Wilkinson, head of development consultancy at Lambert Smith Hampton, which is advising on the 10,000-home, £3bn Northstowe scheme in Cambridgeshire. “The opportunity is now there for the Labour government to work with planning authorities and agencies such as Homes England to create the conditions necessary to expedite delivery of housing.”
At Henry Boot, part of a consortium behind the 10,000-home Worcester Parkway masterplan, chief executive Tim Roberts added: “We welcome the chancellor’s proposals to set up a dedicated task force to accelerate the delivery of important masterplans across the country, creating urgently needed housing, and are pleased that the strategic significance of Worcester Park has been recognised as part of the new government’s appraisal of the housebuilding landscape.”
A couple of months ago any interview with a real estate player would have included them bemoaning a lack of political clarity and certainty holding back their work. Across all of these conversations it feels like there’s a realistic note of hope that what one agent described to me as “the absolute shitshow” of UK politics in recent years has come to an end.
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