David Johnson, managing director of Space Property, has an ambition to own a racehorse. At the moment, he has to content himself with a box at Ascot but, if his determination to achieve this matches that evident in his business plans, then it can only be a matter of time.
Space Property, a five-year-old shed developer, with 1m sq ft of property and £150m worth of schemes, is based in Park Royal, west London, but this year set up an office at Crossways business park in Dartford. It is the first step to widening the company’s coverage around the M25.
Park Royal has sentimental as well as business connections for Johnson. His father, also a developer, had an office and built schemes there.
Most of the company’s projects to date have been in the area but, as all M25 developers know, land is in short supply there, and expensive.
Johnson believes Crossways, with Kent in general, is a growth area. At the moment, the company specialises in joint venture shed development at the smaller end of the spectrum. Its forte is acquiring older buildings, breaking them up and refurbishing them. It also builds new properties. Funding comes from institutional investors.
“We thought buying at Crossways would be a perfect opportunity to make a base there,” says Johnson.
Johnson, who set up Space with Paul Thornberry his spiritual if not biological twin, as they share the same birthday sees Crossways as a step towards expansion into an established industrial developer.
Having been involved in the market for many years, he knows that it is not easy. The company’s first scheme Genesis struggled to let, and was eventually sold as freehold.
“In the past five years, the number of companies developing has increased,” says Johnson. “A lot of the demand has been soaked up, so there are a number of schemes that haven’t gone as well. When you get to that stage, you have to look at something else.”
The something else was sub-3,000 sq ft sheds, but there are still those ambitions, and moving into the other end of the spectrum has certainly not been ruled out.
When it comes to sites, Space definitely does not baulk at taking on the big players. The company, together with Standard Life, bid for the 25-acre Guinness site at Park Royal. It lost to Brixton, but the bid shows the confidence Johnson and his investors have in the firm’s abilities.
Management team
“You’ve got to make sure that you don’t overpay for a site, get the sums right and hopefully make a profit,” he says.
While Johnson dominates the conversation about Space, there is one issue which gets the rest of the management team animated planning. But the company does not blame planning departments as such, but more their lack of resources.
Thornberry describes one incident concerning a site designated for employment use. The local council liked their plans, but the Highways Agency was concerned about a possible increase in traffic, and challenged the application. The council, under pressure to deal with the application within a certain time frame, ended up turning down the proposal.
“We ended up having to pay a consultant to deal with the application,” says Thornberry.
Retelling the tale obviously opens up old wounds, with utterances of “crazy” and “frustrating” from Nick Turner, Space’s director based at Crossways.
Johnson says it is a situation that is arising more and more. Occupier demand is also different now. Alex Gale, development director, explains: “If a company owns a small unit, it wants it to look smart, like their own homes.”
For Space, business is about knowing the market and satisfying clients. But, in expanding the company, Johnson is keen not to lose the personal touch. “I see potential for growth within the management structure,” he says. “We don’t want to buy a lot of sites, and not have the management to deal with it.”
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David Johnson, managing director Born Beaconsfield, 30 July 1967 Educated Merchant Taylors, Northwood; Bristol Polytechnic 1989 Formed Alexander Johnson with brother Andrew 1994 Formed Park Royal Estates, which evolved into Chancerygate Group 2000-01 Left Chancerygate to set up Space Property Lifestyle Wife Sarah, two children |
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Paul Thornberry, commercial director Born Uxbridge, 30 July 1967 Educated Merchant Taylors School, Northwood; Bristol Polytechnic 1989 Cyril Sweett as senior QS 1991 Elected associate of RICS 1993 NBW as managing surveyor 1995 KPMG as senior manager 1999 Set up own consultancy, specialising in capital allowances Lifestyle Wife Nuala, two children |
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Alex Gale, development director Born Wimbledon, 1970 Educated Whitgift School, Croydon; Leicester Polytechnic 1992 Stiles Harold Williams, surveyor 1997 Colliers Erdman Lewis, senior surveyor, becoming a director 2005 Space Property Lifestyle Wife Lesley, three children |
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Nick Turner, director Born Rainham, Kent, 1971 Educated Howard Grammar School; South Bank University 1994 Sibley Pares & Partners, surveyor 1996 GVA Grimley, surveyor 1997 Regional surveyor, Blue Circle 2000 Transferred to Whitecliff Properties, a joint venture between Blue Circle and Lend Lease, as development manager 2006 Set up Space Crossways Lifestyle Wife Paula, three children |
