Luxury residential developer Linton Group is shifting into commercial property, prompted by rising land values, the impact of stamp duty changes and Brexit.
The company has teamed up with commercial developer Henika Group to build a £100m commercial property portfolio based in London and the South East.
The joint venture has made its initial investment in Croydon, south London, buying two freehold properties totalling 60,000 sq ft at 9-11 Wellesley Road for £11.8m.
Gary Linton, founder and management director of Belgravia-based Linton Group, said: “I have built up quite a big residential development pipeline, but having found the land market very competitive and all the uncertainty making the residential development tougher to compete in, [Henika Group’s] Chris Reid and I are now looking towards acquiring commercial assets with a fundamental income, which have asset management opportunities.”
The developers are refurbishing 11 Wellesley Road and will be seeking tenants for the building later this year.
The joint venture sees the serviced office market as particularly attractive, with an emphasis on WeWork-style flexible working.
Linton said: “Croydon has been on the horizon for a number of years due to its excellent transport links, but the Westfield regeneration finally getting planning and coming forward in the immediate future, combined with other schemes coming through, means all the talk about Croydon’s redevelopment is finally happening.”
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