EDITOR’S COMMENT While the phrase “a nation of shopkeepers” may have been levied against the English by Scottish economist Adam Smith in 1776 as a veiled criticism of their lack of ambition, it is, in fact, a truth. And not just for the English. For the UK.
Exclusive analysis using EG’s Radius Data Exchange shows that the vast majority of the 1.5bn sq ft of retail property in the UK is owned, in some shape or form, by you and I. We all, either as taxpayers, pension fund contributors, private investors or retail investors, own about 900m sq ft of shops and restaurants.
Highly capitalised investors and sovereign wealth funds, on the other hand, own just a slice.
And to borrow a phrase (albeit never actually said) from Michael Caine, not a lot of people appear to know that. Landlords are not big bad, fat cats, but in fact are you and I. And while I may have a fat cat (a rather lovely one though, not a bad one), I do not identify as one.
What is she talking about, you may wonder? Has lockdown finally got to her? Well, yes, but I will get to my point.
Government, it seems, thinks that it is protecting the man on the street by “cracking down” on evil landlords forcing tenants to pay their bills. It is not. It is potentially hurting that man (or woman). It is damaging the value of our investments, it is potentially hindering our ability to draw our pensions, and it is certainly not doing a great job at promoting the UK as a beacon for international investment.
Our real estate is the jewel in the UK’s crown and government cracking down on the ability of real estate owners to operate as businesses will most definitely take the sparkle off.
And the large majority of landlords are, in fact, being fair in their conversations with tenants that are unable to pay. The majority are not issuing statutory demands or winding up orders to independent retailers that really have no other option to keep afloat than to not pay their rent. And the large majority of landlords do not have the financial headroom to take the deferment of rent on the chin as (as EG’s data shows) the majority of landlords are not large, well-capitalised corporates.
Most landlords really need income, they need returns and they need businesses in their buildings with income too. They want to support those that really need it.
Government needs to understand that there is a virtuous circle in real estate. That landlord, tenant and lender all need to be part of any support package. All need to interact with each other fairly, morally and with a single goal in mind – to support the UK, its economy, and its people. And that means flexibility for all, not rigidity for some.
Two familiar names have resurfaced in real estate this week. Nick Shattock, formerly of Quintain, and Robert Whitton, of aAim and ROM Capital, have teamed up to help solve the housing crisis with the establishment of a modular housing business. They have £1bn ambitions and have already secured £100m of investment, an off-site manufacturer and their first handful of sites. Welcome back boys.
To send feedback, e-mail samantha.mcclary@egi.co.uk or tweet @samanthamcclary or @estatesgazette
