An ambitious new launch by one top agent and a landscape-shifting acquisition by another. It has been quite a week. No doubt it’s going to be a frenzied year.
Savills announced its purchase of New York-based brokerage Studley last Thursday. At £154m, it is the adviser’s biggest-ever acquisition. It is also a statement of intent and a recognition that you can’t call yourself a global adviser without a sizeable US footprint. As chief executive Jeremy Helsby tells EG this week: “If you look at our size, it was illogical for us to be so tiny in the largest real estate market in the world.”
What’s most interesting is less what it does for Savills’ turnover and more what the firm can now offer clients beyond the US. A third of occupier take-up in London came from US businesses last year, says Helsby. And if you don’t have ready access to that business, your ability to win instructions will always be severely curtailed.
Meanwhile, a US agency giant is moving the other way. Keller Williams is plotting to become a top-five UK agent within six or seven years.
Its franchising model is very different to the traditional UK offer. But it is confident that allowing agents to trouser as much as 92% of the fees they earn for the business will prove compelling. The firm will attract interest for sure.
That’s just two businesses. DTZ’s future – as an independent vehicle or in the arms of private equity – will become clear soon. And at the same time the likes of Cluttons have been quietly making footprints in 50 countries around the world.
So another week, another shake-up among the top agents. How might we be describing the year in agency-land come December?
¦ When will overseas investors look beyond London? It’s a common question – and perhaps a redundant one. To take just one example, Chinese investors are upping their interest in Manchester, as we reveal this week. It adds strength to the story that an overseas investor who puts a stake in the ground in the capital can be tempted to look beyond.
If that is the case, then there are other encouraging stats around this week. JLL said China’s overseas real estate investment rose by 25% in the first three months of this year. Chicago ($464m (£274m)) may have led the way, but London ($348m) was next. Meanwhile, the mayor of London’s inward investment agency London First said this week it had helped 260 international companies establish themselves in London in 2013/14, 16% more than the year before. Some 24 of those companies were from China, up from 22 last year.
From an investment and an occupational perspective, it’s an encouraging investment story all round.
¦ According to British Chambers of Commerce, 85% of UK businesses don’t want Scotland to quit the UK. If the chatter at last Friday’s Estates Gazette reception in Edinburgh was anything to go by, I’d say the same is true of the property industry north of the border. Few were willing to call this autumn’s referendum, but there was a consensus that it would be a long, quiet summer, with investors sitting out the uncertainty. But at least one group of landlords could stand to benefit from an independent Scotland, suggested one gossip. The owners of Edinburgh town houses may be tempted to stall sales over the next six months as they would make ideal consulates for any government seeking a home in a new nation state.
¦ Another cracking Outside View interview this week; this time with Michelin-starred chef Jason Atherton. He talks about his expansion plans – restaurants and a hotel – and how he makes location decisions based on numbers, not emotions. An exceptional cook in every sense then.
Damian.Wild@estatesgazette.com
