When Cluttons asked clients recently what they thought of the 250-year-old firm, one described it as a sleeping giant that had woken up over the past year or two.
“There’s some truth in that,” says managing partner John Wood, who with senior partner Bill Siegle insists that the partnership’s eyes are now wide open to its potential to offer a global alternative to the top tier of agents.
Core to its strategy is a target to secure up to half its revenue from outside the UK by 2020 as a result of new offices and international contracts.
International revenue now stands at 25%, up from 20% when the goal was first set in 2010. It is expected to reach 30% this year. “We have been in the Middle East for almost 40 years and we wanted to build on that by moving into the Far East and Africa,” says Siegle.
Provisional unaudited figures shared with Estates Gazette show that turnover for the year to 31 March 2014 exceeded £40m for the first time since 2008, up by around 10% on 2013.
Consultancy brings in the lion’s share of the figure (35%), followed by international (25%), residential agency (20%), agency and capital markets (10%), and technology, media and telecoms (10%). Revenue from the TMT division is expected to double over the next three years.
“We can’t compete against the very large agents in every market, but we can in our chosen markets. The focus is very much sector-led, focusing on TMT, utilities, charities and getting more involved in corporate occupier work,” says Wood.
Siegle says that profits, due to be announced in November, are up significantly too, despite the investment in international expansion, a rebranding exercise, and new hires, which have taken its staff figure back up to 600 after a dip to around 450 during the downturn. “We are now much more commercial with a small ‘c’,” says Siegle.
While Cluttons has only two UK offices outside London (in Brighton and Oxford), recent investment has taken its overseas coverage up to 50 countries, through a mixture of owned offices and joint ventures, including an alliance formed in 2010 with Far Eastern firm VPC.
The United Arab Emirates remains its biggest overseas presence, with a quarter of its staff based there.
This month, Cluttons’ Middle East headquarters will move to larger offices in Dubai’s Media City. Around 60 people will be based there, with room for expansion to 90 over the next three years. Cluttons is also finalising a new jv in Saudi Arabia, which it hopes to have operational in the autumn.
“Very few people have found it possible to operate there,” says Siegle. “We have also kept a presence in Bahrain at a time when others have been pulling out. This is where our long experience in the region pays off.”
Its Middle East expertise was key to the recent win, with Newmark Grubb Knight Frank, of a facilities management contract for telecoms giant Nokia Solutions and Networks. The contract covers 121 properties totalling 2.4m sq ft across 94 countries in the Middle East, Asia Pacific, China, and Africa and will see the transfer of some 125 staff. Cluttons has set up a new division in Dubai – Cluttons Global Facilities Management – to manage the contract. Wood says this will act as a platform for future global corporate services work.
Africa is key to the next phase in Cluttons’ overseas expansion, says Wood. “The potential is vast and if you look at the big agents, Africa is a gap in many of their networks,” he says.
In Nigeria, Cluttons is in final negotiations on a jv to provide general property services. This will draw on retail development expertise gained in the Middle East and will build on a facilities management agreement with Lagos firm Alpha Mead, put in place seven years ago.
Elsewhere, Cluttons has opened a new owned office in Egypt led by Michael O’Connell, who is recruiting others to support the delivery of the firm’s global telecoms mandates and other work. It has also recently set up in India, led by Matthew Greenwell, under a government launch pad initiative that enables it to seek a jv partner.
Back in the UK, Cluttons has just closed the deal to buy niche City firm Chapman Bates, (22 March, p33). It plans to further bolster this office with more hires. It is also opening two residential branches this year in Blackheath, SE3, and Camden, NW1.
With so much change, Cluttons’ sleepy days certainly seem long gone.
julia.cahill@estatesgazette.com
