It’s been a great summer and autumn. I have been in the very fortunate position of having what any mid-lifer covets – six months of my own time before embarking on a second career. So how did things look from the garden of life after almost 30 years of being chained willingly to the same agency desk at Cushman & Wakefield? Here are my sabbatical observations.
A broader perspective
A sojourn from the market has given me a broader perspective of where the property market sits in the investment universe. It is inevitable that after such a sustained recovery, and some wonderful returns, that thoughts of a downturn appear to be commonplace. Sometimes you need to break away from the short cycles to see the longer ones. I’ve come back with a view that although pricing might well have peaked in many sectors, property is still a pretty decent option for investors seeking tangible returns in what remains a challenging environment for pleasing investors.
Trees never do grow to the sky. While innovation is always to be lauded, it strikes me there could be a number of cupboards out there full of the emperor’s new clothes in the form of potentially unachievable promised returns for new equity, based largely on recent strong short-term performance. Property is, has been and is likely to remain, an investment for the medium- to long term and largely an income-driven one at that.
Ignore fear of failure
I have finally worked out that the fear of failure in business is a complete waste of time. It gets in the way of achievement. In an aggressive world driven by unrelenting short-term targets, we need to be mindful of the pressure that failing to hit these targets creates on a workforce, particularly in big organisations where real talents do not want to feel like hamsters on a wheel, but where many of them do.
Make time for face time
E-mail and voicemail are great – that’s my first fib – but there is nothing like communicating with people by seeing them and spending time with them. Our industry used to thrive on this but we seem to have let it lapse a little as generations move. The optimism and invention created by the sharing of the human spirit are pretty evident – the feel-good factor of the Rugby World Cup was a perfect example.
I had imagined that my sabbatical might coincide with election uncertainties and a quiet summer but I couldn’t have been more wrong. It looks like it is going to be another good year for returns, investors and agents alike with the record for annual turnover likely to be broken again – it is getting to be a bit like Sergey Bubka at his prime, cranking things up little by little every year.
For all of that, there is a little caution out there from many good judges who seem to think that the days of just buying the market, particularly in London, are probably over. There is some circumspection over the capital’s short term with regard to both pricing and occupiers, but at least those two fundamentals seem to be marching to the same drumbeat, for once.
It seems to me that the gap between prime and secondary might just have got too big. I have been a prime addict all my working life, and continue to be one, but investors’ fads and fashions now seem to converge in a flash and when things are out of favour they are colder than a polar bear’s pyjamas. Strong secondary retail in good towns, half decent foodstores and unspectacular retail warehouses seem a little unloved just now.
My wanderings around the UK over the past six months – which have been a pleasure – have reminded me that we live in a country where places matter.
Spotting a prosperous town
The towns that prosper tend to exhibit the same characteristics: a sense of history, a decent socio-economic back story and a forward-looking local authority. The number of agents’ boards in weak towns remains a worry, especially in secondary retail. But they are noticeably reducing in the smaller stronger centres where rents have fallen, local spend remains to be captured and where good local retailers are once again seeking to prove Napoleon right.
My other reports from the field are that workaday sheds are pretty fully occupied around the country, that there are prelet supersheds popping up all over, new and shiny offices are prevalent in our provincial city centres and there are busy restaurants everywhere. Despite theories to the contrary, houses are being built back in town centres and regeneration is happening. But you probably knew all of that.
Let’s fix the roads
If a good thing about driving around the country has been seeing the green shoots of occupational recovery then undeniably the downside was having to cope with our inadequate road infrastructure. By midsummer I was beginning to think that I had missed the announcement of a new national speed limit of 50mph on the motorways since that seemed to be as fast as I was allowed to drive. It didn’t seem to matter whether it was Somerset, Wales, Yorkshire or Scotland, it was the same all over. And in the South East on a Friday, 50mph anywhere is a pipe dream. What is to be done? Anything that takes traffic off the road, even HS2.
This six-month career break has been a great reminder about the balance of life. Work is important to all of us, but family and friends are significantly more so. I’ll try to remember that now the sabbatical is over.
