Full marks to Rob Noel for candour. “We as a sector have destroyed more shareholder value than anyone else,” he admitted this week. In saying the unsayable, LandSec’s chief may just have begun property’s rehabilitation.
I can’t think of a FTSE100 chief executive who has made quite so frank an admission in recent times. A public acknowledgement from the top of the corporate tree that the rewards on offer to investors have failed to match the risks incurred is a rare thing.
Of course, time is on Noel’s side. He is a year into the job, a period that has coincided with LandSec’s share price climbing nicely. That said, its 459p share price on Thursday compares painfully with the 2,323p at which it ended 2006.
It’s worse if you plot its performance against the FTSE100 over the last decade. It outperformed the FTSE100 until mid 2008 and has lagged ever since. Now the unsayable has been said, the industry – not just LandSec – should move on and concentrate on building value.
Noel was speaking at a BPF-organised meeting of global REITs in London. Welcome though his comments were, I have to say I profoundly disagree with an intervention by Peter Verwer, chief executive of the Property Council of Australia. “We will never get people to love us and we shouldn’t try,” he told the meeting.
Property has long complained that its voice isn’t heard by government. In recent weeks, in residential, there are signs that that is changing. Now is the time to step up a charm offensive, not abandon it.
The BPF’s Big Three – Chris Grigg, David Marks and Bill Hughes – are all speaking at next week’s Movers and Shakers breakfast in London. I’ll report back on whether they agree.
Speaking of charm offensives, housing minister Mark Prisk talked enthusiastically at this week’s EG Residential Summit of the government’s commitment to the residential sector. And he was persuasive. Delegates and speakers from PRUPIM’s Martin Moore to First Base’s Elliott Lipton welcomed his warm words and committed to deliver themselves. Others, including Legal & General, are waiting in the wings. After years of inertia, all that talk of institutional interest in the private sector is fast becoming action. We broadcast Prisk’s speech live on EGi; if you missed it, you can listen again at www.estatesgazette.com/resilive.
Perhaps Google should top EGi’s latest London agents league table. The internet giant’s deal to take 860,000 sq ft at King’s Cross was bigger in its own right than the 56 deals CBRE advised on combined. It caused DTZ – which advised Argent together with joint agent Savills – to leapfrog the green machine and distorted a quiet quarter, accounting for a third of the market’s overall 2.65m sq ft take-up. Strip that out and 2013 has made a subdued start.
There is better news outside London. Benson Elliot and Stanhope are set to spec the 1.7m sq ft Station Hill redevelopment in Reading. It follows last month’s news that Skanska is to speculatively develop the 60,000 sq ft 66 Queen Square project in Bristol. In Edinburgh – where the council-developed, 200,000 sq ft Atria scheme opens next month – there is fresh talk of spec too, as there is in Cambridge and Aberdeen. With Birmingham’s property contingent enthusiastically enjoying the opening of 2 Snow Hill last week, there’s real pace in the market beyond the M25 for the first time in years.
This weekend’s London Marathon offers this industry a platform to highlight two skills at which it excels: competitive exercise and raising money for worthwhile causes. No wonder so many property types are taking part; good luck to you all, including five members of the Estates Gazette team.
