Investor Chris Tzouvanni is acutely aware of the real value of his £20m property portfolio.
Adjacent to his desk in his Southgate office is a faded sepia photograph of a hilltop village in Cyprus, which he looks at often. Dispossessed at the age of 11, Tzouvanni and his family were forced to leave the city of Nicosia. Turkish guns now stand on the hilltop village of Ayia Marina that was once his family home.
Arriving in England in 1959 with almost nothing, Tzouvanni began making toys for children, taking six months to raise the money to buy his family their first television for £12 and sweeping factory floors in the evening after school for five shillings a time. “You have to have that drive as a boy and then one thing leads to another,” he says.
During the past 23 years he has created a portfolio comprising 28 mixed-use and commercial buildings, heads three property companies and an insurance firm working with his two sons, and privately owns other properties with his wife.
A family affair
Today, most of his acquisitions are in London, with some in the north and east Home Counties. Together with his sons, Andy and Solomon, he also runs a lettings and managing agency for clients who live in Cyprus.
Tzouvanni credits his father for sparking his move into property after seeing him procure two shops with vacant flats above in Stoke Newington, north London, for £11,000, letting them to a local trader for £300 pa, and giving them to him as a wedding gift in 1976.
“I invested in property from that time onwards, acquiring a couple of buildings every two years through auctions. My father died three months after I married, so it was some sort of legacy I suppose,” he says.
Before moving into real estate he worked for five years as an articled clerk for a chartered accountants firm and spent some time in the rag trade. “I failed my last exam four times and my dad suggested I become an estate agent. Instead, I became an investor,” he says. “I kept the rents in one account and wouldn’t spend it. It is the only way to make money and to expand.”
In 1980, Tzouvanni “nearly lost everything” in a risky extension of a building on Tottenham High Street: “It cost £25,000 and I borrowed £55,000 to extend it. If I had not found a tenant immediately who paid £8,000 in rent and which saved me from collapse, everything I owned would have gone.”
In 1983, just as property prices slumped, he purchased a parade of shops in Winchmore Hill. He says: “The bank would not release all the money for them and I was £30,000 short of meeting the purchase cost (equivalent to around £200,000 today). It was a real challenge, but fortunately the Bank of Cyprus agreed to lend at 4% above the base rate.”
Five tenants left the parade after Sainsbury’s opened a store in the area in 1989 and Tzouvanni admits that it was a very difficult time. “Fortunately I came through and found others. It is so often a question of holding your nerve and having faith. I had six sons and a daughter to look after and I did not sleep at that time,” he says.
Tzouvanni has regularly bought through auction and began operating as a trader, where as before he was purely an investor, when he acquired a fish and chip shop in Kent for £72,000 in 1988, selling it a month later for £80,000. He bought a retail outlet soon after in Bradford for £102,000, producing £5,000 a year, which he sold six months later for £140,000.
His outwardly benign exterior masks a risk-taking business persona: “I do take risks and have bought properties unseen. I often work on instinct and in most cases they make me a lot of money.
“I bought a property in Romford from Comet in 1989 which had a planning restriction for retail of electrical goods only and people said I had made a mistake. But a few years later Comet sold their leases to Topps Tiles and had to apply to lift the planning restriction.
“The rents shot up from £80,000 to £110,000. I paid £750,000 for it and now it is worth around £2.6m and that was on a gut instinct.”
A difficult market
Tzouvanni believes that investors entering today’s market face huge challenges, buying while prices are high and producing 3-4% returns: “It is impossible to get into property now without a lot of financial backing. In my day we made 20% yields on residential and 15% on commercial.
Tzouvanni says that it is harder to buy at auction and it is important to check that properties are worth the money because the rents are being exaggerated in sale and leaseback.
“I invested in London & Edinburgh (now collapsed) two years ago for £625,000 and at £38,000 the rent was quite high. I then found out that it was only worth £25,000,” says Tzouvanni.
He adds: “I was lucky and got rid of it for £700,000, but other people were not so fortunate and may have lost their investment. There is a lot of luck in this business but you also make your own.
“We came to England with nothing but £50. We lived in a rented room in Edmonton, five of us in one room for one year before we bought a house for £3,500 and had a hard time. I never forget the early days and when I think of where my family are now my father would be proud,” he says.
