The pre-MIPIM positivity is palpable. London continues to fizz and many tier-two cities are bubbling up nicely. If it feels premature to pop champagne corks, delegates can feel entitled to raise a glass of Provence rosé.
So what? you might say. What’s not to feel positive about when you have a drink in your hand and the sun on your back, talking shop with like-minded folk? Well, going into the 24th MIPIM, the sense of optimism seems well-founded. And that has not always been the case in recent years.
This week’s Knight Frank Global Wealth Report indicates how much available cash is sloshing around the global economy and just how much of it may find a home in London over the coming years.
Alongside New York, London is the destination of choice for the global elite, a point that the mayor will no doubt hammer home when he delivers what is bound to be a tub-thumping speech on the London stand on Tuesday. (He may even deliver a similar message to the Paris pavilion – in French, naturally – if he makes his usual detour there. MIPIM has missed Boris; as Liz Peace notes (p70), it needs champions like him).
But back to that Knight Frank report. The total wealth of high-net-worth individuals – those with net assets valued at $30m or more – increased to $16tn last year. Their ranks are forecast to rise by 50% by 2022, and the number basing themselves in London is expected to rise by a third. With perhaps as few as 6,000-7,000 flats and houses worth over £5m in the capital, there is plenty of scope for top-end development and conversion.
It is little wonder that developers are queuing up to snap up the limited opportunities that do exist at this end of the market.
Mount Anvil is vying with the Malaysian owners of Battersea Power Station for control of the £500m Marco Polo House scheme, SW11. Meanwhile, the Caudwell Group is eying Mayfair’s Audley Street car park with a view to turning it into around 20 luxury flats with a total value of at least £500m.
But it’s not confined to posh flats in the capital’s glitzier corners.
Construction giant Skanska is to undertake its first UK speculative development. Its 66 Queen Square project in Bristol will deliver 60,000 sq ft of grade-A office space into a market starved of supply.
In the past few weeks alone, Blackstone has confirmed it is to speculatively develop an £80m, 334,000 sq ft building at Chiswick Park in West London. Land Securities’ spec overhaul of Victoria continues. And no one would be surprised to see spec offices developed in Cambridge and Aberdeen this year.
Going into MIPIM with well-founded confidence is important. Coming away and ensuring there is momentum is much more so.
A 12-strong Estates Gazette editorial team will be busy at MIPIM next week, covering all that happens in print, online and on video. Whether you are here or there, you won’t miss a thing through our daily digital editions (again, available on iPad too). We will also be launching an exciting new app; more on which soon.
And do tune in for two live web seminars. You will be able to quiz expert panels from the comfort of your desk.
The first 30-minute debate, on London’s place as the gateway to Europe, takes place on Wednesday at 9.30am GMT featuring Brockton Capital’s David Marks (incoming British Property Federation president); RREEF’s James Petit; BNP Paribas Real Estate UK’s John Slade; and Lodestone Capital’s Becky Worthington, formerly Quintain’s deputy chief executive.
Thursday’s session, at 9am GMT, poses the question “London: capital of Asia?” Panellists include Canary Wharf Group’s Howard Dawber, Berkeley Group’s Tony Pidgley, Savills’ Mark Ridley, Residential Land’s Bruce Ritchie, and Capital & Counties’ Gary Yardley.
Do join in. Click here for all you need to know about MIPIM.
