You are viewing 1 of your 1 free articles
Dispatches from Cannes
Inside Housing has joined the increasing numbers of social landlords attending the MIPIM conference in Cannes this year. Nick Duxbury reports
Welcome to MIPIM, a global property conference set on the French Riviera. Over the next three days 21,000 investors, lenders, brokers, developers and architects will descend on the city for what amounts to a complete property takeover. Every space Cannes has to offer is being used for marketing: opulent hotel fronts are festooned with giant company logos; the luxury designer shops that line La Croisette host more corporate banners; and end-to-end along the sea front stand white corporate marquees hosting silver service networking events.
The quantum of Champagne and fruits de mer that will be consumed over the course of the week is hard to imagine – and it is easy to see why Private Eye magazine recently dubbed the conference an annual “booze and hooker-fest”. But it’s more than just a jolly. The conference is a catalyst for billions of pounds of property transactions that generate profits that will easily eclipse the expenses. For this reason, MIPIM is a conference that most property firms can’t afford not to be at.
Inside Housing, in its own slightly more budget manner, also joined the pilgrimage to Cannes. Why? Because social landlords are also showing up in force. It used to be one or two of the more commercial players which attended. Now, increasingly, housing associations and local authorities are concluding that they too can’t afford not to have a presence at this annual ‘real estate’ (because that’s what global property tycoons like to call it) jamboree (because that’s what it is, really).
Here are our take-aways and some of the talking points from day one at MIPIM:
1. There are more local authorities at MIPIM than ever before
Schmoozing developers on what looks like a taxpayer funded jolly is, of course, an awkward look for councils to wear. But increasingly the braver ones are taking the plunge. Ealing, Haringey, Hounslow and some of London’s outer boroughs are here alongside the big regional cities – Birmingham, Manchester, Leeds, Coventry, Newcastle, Liverpool, Stoke, Bolton and Nottingham. Indeed, Nottingham told Inside Housing that a joint venture with investor Igloo was a direct result of conversations held at MIPIM.
2. The private rented sector is so hot right now
Everyone wants a slice of the PRS pie – perhaps in part because some believe the commercial property market’s bull run is coming to an end so are looking to residential investment instead. Pension funds are competing for access to schemes. Yesterday, the British Property Federation called on the London mayoral candidates to take “bold action” with Build to Rent by setting aside a quarter of public land for PRS schemes.
3. Market rent looks like being the name of the game among regional local authorities
A couple of cities are referencing plans to scale up their direct construction of private rented sector accommodation. Drinks with potential funders are likely to flow and, hopefully, grease the wheels of these ambitious plans.
4. Building offsite is taking off in a major way
After years of talk, since Inside Housing revealed that L&G is building an offsite construction factory, the rest of the industry has gone mad for it. One architect said that in the last week alone, he had received four separate enquiries about designing offsite homes.
5. Housing matters, but affordability doesn’t register quite as much
In a debate about the priorities for the next mayor, keeping supply up in London dominated minds, but house and rent prices were notable only by their absence – in a stark contrast to this debate in most other forums. The only reference came from Tony Pidgley, chair of house builder the Berkeley Group, who railed against Sadiq Khan’s 50% tariff for affordable housing.
6. The ‘house’ in Northern Powerhouse is less significant than you might think
One of the highlights of the programme was a debate on the drive, but while transport, health, technology and shipping took a front seat, housing was a fringe issue. The only real mention was the opportunity created for the area as priced-out graduates flee the South East.
7. Brexit is weighing on the minds of property developers
A question on Brexit has cropped up at virtually every session of the day. Indeed London mayor Boris Johnson, who normally attends, is notable by his absence. The consensus: uncertainty will breed a slow-down in deals and development, and this will only get worse in the period that would follow a victory for ‘leave’. Cannes votes ‘in’.
8. Foreign investment in London’s housing market is a thorny issue
Developers need it to enable future phases of schemes, but politically this sits uncomfortably. Sir Edward Lister, deputy mayor for policy and planning at the Greater London Authority, was at pains to emphasise there are not lots of vacant homes owned by foreign investors in London… Given that most of those on the London stand had come to France in order to market their schemes to foreign investors, this seemed a bit odd.
9. There are some elephants in the room
The prime residential central London market is looking increasingly shaky, with investment bank Morgan Stanley recently warning of price falls of up to 20%. No one dare chat about this with the many major luxury developers that are out in force marketing their schemes. Similarly Capco, which is exhibiting its Earls Court scheme, will be praying that Sadiq Khan doesn’t win the mayoral election after he pledged to review the development if elected.
10. Brandon Lewis is expected to pay a visit to Cannes
The housing minister is understood to be heading to MIPIM on Thursday to do his bit in attracting investment in badly-needed housing. This doesn’t appear to be particularly publicised.
