“Did you have any reservations about leaving an incredible job at Blackstone and an amazing Mayfair office to put all your trust in a 23-year-old and come to work on a desk made out of a plank of wood?”
That was the question posed this week by Ross Bailey, the youthful founder of retail pop-up venture Appear Here, to Peter Lennon, the start-up’s new head of global landlord partnerships. Such is the promise of the operation – and the scale of its achievements, with 10,000 brands and 750 propcos already on the books – that Lennon was persuaded to put a $10bn portfolio behind him (p48).
EG has covered the rise of the disruptors assiduously in recent months – yet Lennon’s articulation of why he made the move is revealing. As are the reasons his new boss Bailey gives for Appear Here’s 500% year-on-year growth rate.
“I think our naivety has been a big part of our success; it means we can act on gut instincts,” he says.
Those words should resonate: if you think you know what you are doing simply because you have been in this game for a long time, re-read that quote. And then read it again.
After a couple of weeks out of the country I may be one of the few not yet to have tired of the election grandstanding. I give it a week.
One thing resonated though at the launch of the manifestos this week. Please do forgive a fleeting moment of trumpet blowing. Readers with assured memories will recall a line that appeared on this page in December: “As the economy strengthens, this general election may not be fought on living standards but on living rooms, especially around how many new ones can be provided up and down the country.”
That was apparent in the manifestos (p52). The Tories promise 400,000 homes built over five years, Labour 200,000 annually by 2020 and the LibDems 300,000 a year within the decade. Each is a startling number and each falls some way short of predicted need.
There are many estimates of what is required; one of the more respected came from the Town and Country Planning Association in 2013, based on the government’s official household projections for 2011-2021. The TCPA put requirements at 240,000 to 245,000 additional homes each year up to 2031 in order to meet newly arising and existing demand in England alone.
But despite that chasm, the parties are focusing on policy soundbites, not solutions – whether it’s mansion tax or the Right to Buy rehash (“terrible policy” and a “cheap vote winner”, according to JLL, no less).
At best, these are policies designed to woo kneejerk voters before the real focus on sustainable solutions to housing need begins in office. More likely they are a fig leaf, with more talk than action to follow in government too.
Spring has sprung and, with the biggest deal since the financial crisis signed and sealed, so has the global property industry.
Blackstone – them again – and Wells Fargo are acquiring $23bn (£15.5bn) of real estate debt and assets from GE Capital.
It begs a number of questions. Can Blackstone continue to be regarded as a nimble, ahead-of-the-game PE player while clearly turning into a juggernaut? Its size and influence these days means its decisions are determining sentiment.
Meanwhile, Blackstone and its partners in this deal are in a position of such influence that they can act beyond the open market. It causes grumbling among competitors, but wouldn’t they all act that way of they could?
Of course they would. Blackstone and its ilk pay the most, hire the best and expect results. And they will continue to deliver for as long as their model works and is able to flourish.
