In a market plagued with uncertainty, it is a tough year to take on the role of president of the British Property Federation.
The referendum vote, the resulting political fallout and faltering investment volumes have resulted in a preoccupied government. One that is likely to prove all the tougher to lobby.
But David Sleath is up for the challenge. Three months into the role, the chief executive of industrial giant SEGRO is the first president for 10 years to come from a logistics background. But far from his specialist background being a hindrance, there is every chance that his day job could have been the best possible training for his BPF role.
After all, he has spent the past five years working closely with central government, the Greater London Authority and local boroughs on schemes such as East Plus, which was launched in 2015 in London Riverside and will see the development of 86 acres of industrial land.
Open for business
With most eyes and ears turned to Brexit, Sleath will have to make sure the property industry does not get sidelined in 2017 and that the message remains clear that the UK is open for business.
It will be no mean feat.
“The government is going to be incredibly distracted,” he concedes. “They won’t be able to respond to everything we would like them to.
“We have to be careful, as an industry, that we don’t try to ask for too many things and don’t have too many contact points that mean we lose the effectiveness of our voice.”
He adds that, with just a year-long tenure, staying realistic is important: “You can’t change the world. You’re only going to achieve what the other people around you can do. I am a big believer in the stewardship principle – you can look back and say you did a good job if you leave the organisation in a better shape than it was when you joined.”
So if it is about prioritising and firmly communicating the property sector’s most pressing requirements, what is top of Sleath’s list?
Message to government
Maintaining jobs, removing barriers to investment, further reforms to the business rates system and showing its commitment to house the nation will be at the core of the BPF’s message to the government.
At the Conservative Party conference held in Birmingham earlier this month, the BPF hosted a fringe event, promoting the message that the government needs to end the uncertainty surrounding the referendum result in order to stabilise the market. Sleath hailed a “new era” in British politics, and said that, despite the uncertainty, there is still a lot of excitement about what the post-Brexit world is going to look like.
One of the BPF’s clear messages at the conference was that until there is more certainty surrounding the UK’s political landscape, investment volumes are unlikely to pick up – and inward investment is an absolute must while the country prepares for its seismic departure from the EU.
“In the short term, it’s around stability, retaining confidence and creating an environment that encourages people to invest in UK real estate – which is going to be very important for the economy itself,” says Sleath.
He also pressed the government to grasp the opportunity to encourage the development of more build-to-rent homes by changing the planning rights over brownfield land to make the planning process easier and faster for developers.
With conference season now out of the way, the next big date on Sleath’s – and the government’s – calendar is the Autumn Statement, scheduled for 23 November.
The government has already been hinting that there may be tax cuts on the horizon, some of which could make a real difference to the property industry – such as a stamp duty holiday or cuts for first-time buyers.
“If they delayed the implementation of the stamp duty increases or provided some kind of stamp duty holiday, that could be a real fillip for the economy in the housing sector,” says Sleath.
In reality, additional government investment is likely to be more powerful than cuts. Further investment into infrastructure projects, as well as research and development programmes would all contribute to tackling the housing crisis.
The BPF will be promoting build to rent by pushing for the National Planning Policy Framework to be a faster process as well as pushing for further support for modular construction.
Proposed barriers for investment pose the biggest challenge. The OECD’s base erosion and profit shifting (BEPS) project could spur the most significant changes to the taxation of international businesses in nearly 30 years. In terms of investment, a change this drastic could cause serious delays for the whole industry, and the BPF is pushing hard to postpone these.
“It’s a very complex thing they’re trying to do and it will be bound to have some consequences that are unintended. Why would you rush?” Sleath asks. “Particularly when the interest restrictions themselves may cause people to pause in terms of signing off on new investment. Why would you want to implement it too early? We’ve called for the government to delay implementing on that,” he says.
Planned presidency
In order to make this case and to make it work, Sleath has planned his presidency around three levels of engagement: the industry, public opinion and government.
And building up a relationship with the public will be at the heart of this strategy, not least because Sleath believes this could be the best route to government. “I think that politicians tend to look at the commercial real estate industry with a little bit of distrust,” he says. “They might think, ‘They’re after something here and they’re probably trying to make money at our expense’.”
Making sure that the public knows and understands more about real estate’s contribution to the economy will be the first step to tackling this perception issue. “We know that our members do a fantastic job in terms of making a valuable contribution to the industry, but do policy makers, opinion formers or journalists from outside of the sector? Do they have a positive view of real estate and see the good that we do and the contribution that we make?” he asks.
“Unless the public acknowledges the value of the property sector, the industry is always going to find it difficult to get the government to tune in to what the sector needs.”
Communication strategy
Being heard is one thing. Being listened to is another. Sleath is confident he can achieve both, thanks to his three-pronged communication strategy, his strong logistics background and a formidable predecessor.
The last president from a logistics background all those years ago was the late Ian Coull, from whom Sleath took over as chief executive of SEGRO and whose untimely death this year shook the property industry.
“I learned a lot from my predecessor,” says Sleath. “He was a really great man to work with, a great people person. He understood the importance of humility in how he went about business. We’re all in post for a relatively short period of time and the world does not revolve around one individual. So, don’t get ahead of yourself. Just do a good job, remember that we’re all human and try to act with a bit of humility.”
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