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Some deals ensure you get noticed for the next one 

Some deals ensure you get noticed for the next one 

During the current crisis and the government-imposed lockdown, quite understandably the number of commercial property deals being completed, dropped off with fewer quality properties coming to market and difficulties surrounding viewing and valuation thanks to social distancing requirements.  

There has been something of a recovery in the last month, but here at Newmanor Law, we continued to be busy throughout Q1 and Q2, servicing our developer and commercial property fund clients.

The lack of supply however, appeared to make those higher grade properties that did come to market attract a premium, making them seem expensive to experienced investors and developers. But the headline price paid, is not always the only measure of a deals quality.

There are so many moving parts in every deal, that it can be easy to miss the subtle detail that makes a deal good sense to some, when others might be tempted to walk away. 

Investors new to a market or new to a country may choose to pay slightly over the odds for a good quality investment property that will deliver good returns even in a depressed market.

The reason for following through on such a deal, is like when professional players make a few eyebrow-raising bids and calls in poker early on, to send a message to the other players that they are a serious player with the money to back their moves.

It is easy for those on the outside of a deal, just looking at bare numbers to not appreciate that some of these big acquisitions are not just undertaken to secure the property in question, but to ensure the investor is considered a serious player, worthy of being offered better deals in the future.

This is the experience we like to think Newmanor Law offers to our developer and property investor clients. They have the funds but often find it takes time to crack the UK property market and be able to invest what they want, where they want, when they want. One big deal always helps.

In every crisis there is always opportunity

The commercial property market isn’t all just about the acquisition and sale of high-rise glass edifices in city centres, but includes smaller office and retail developments in the suburbs, which are likely to become more important in the months ahead. 

As we head beyond the worst of COVID with organisations evolving the way they work, to include more working from homecity centres will change, with less office space needed and fewer of the retail outlets that serviced them.

Workers at home will require a better mix of local retail, with more on offer than the current fast-food and charity shop options – are we in the early stages of a return to local shops, for local people, still concerned by the thought of mixing with large crowds in shopping malls? 

The recently announced planning reforms and the ability to redevelop non-residential property to residential use more easily, combined with the simplification of the Use Classes will make for an exciting time on the high street as the Government seeks to resuscitate the economy. 

The impacts of COVID-19 should cause local authorities to re-consider their master plans to help create the retail environments people want in the wake of the sharp decline of the traditional high street. 

Working closely with ambitious property developers and investors who have the vision and importantly the funds to help this transformation will be key to the speed of economic recovery witnessed in the UK and our ability to seize the opportunity presented. 

The experienced team here at Newmanor Law, specialists in commercial property legal advice, will be on hand to advise on how any potential deal might impact the rest of your portfolio, so please speak to Karen Mason, on +44 (0)20 7464 4081 or email karen.mason@newmanor.com