GLOBAL
PROPERTY SCENE ISSUE NO. 012
The Number One Buy-to-Let Magazine | www.globalpropertyscene.com
This issue: Should I move to Barcelona? | Guide to commercial property | How will Brexit affect your portfolio? The effects of coastal erosion | The future of mass transportation
FOCUS ON : IRAN
THE POLITICAL CLIMATE DOWN UNDER
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INSIDE Features
15 A guide to commercial property
24 Travel methods of the future
40 Brexit: What happens now?
56 Trade routes of the past
Whether prices are rising or falling, there is always that knowledge that, on a fundamental level, people need buildings. Property has a tangibility many other investments simply cannot offer. Although the real estate market may not always perform how investors want, it’s easy to follow and often makes more sense than other less-concrete investments.
Unsurprisingly, the Travel and Tourism sector is one of the greatest drivers in the global economy, having generated a massive 10% GDP in 2014. It’s a key player in terms of cultural growth, job opportunity, and trade, generating over 1.5 million jobs in 2014 alone. To boost this demand the pressure is on to find new transport methods to support the growth.
As the sun began to rise in the UK on the first day of a Brexit vote, a strange atmosphere appeared to be developing. A sense of disbelief set in amongst the tiredness of those on their way to work across the country, before they could even have a sip of their morning coffee there had been an announcement made from Manchester town hall that could change all of our futures forever.
By the end of the 1st Century AD it was possible to travel from Britain to the Far East along well defined and mostly secure routes.
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07 Market in Focus: Iran
88 UK
In recent years, maritime routes such as the Panama Canal have reshaped the trading patterns of the world and helped enable the globalised economy we live in.
INVESTING IN AUSTRALIA
“The restrictions and censorship in Iran are a bit like the British weather: one day it’s sunny, the next day it’s raining. You just have to hope you walk out into the sunshine.”
84 Should I move to Barcelona? 33
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At the centre of Catalonia is Barcelona, the seat of local government and the city which best exemplifies everything about the region.
The home of the Industrial Revolution, the UK has long been established as a major commercial centre, benefiting from strong trade links with companies on every continent. With a long history in international cooperation, the country is an attractive place for investors both foreign and domestic. Knight Knox has sold thousands of properties. We have experts on the ground that can help to find your perfect property. Why purchase with anybody else?
ISSUE 012 EDITOR’S NOTE
GLOBAL
PROPERTY SCENE ISSUE NO. 012
The Number One Buy-to-Let Magazine | www.globalpropertyscene.com
This issue: Should I move to Barcelona? | Guide to commercial property | How will Brexit affect your portfolio? The effects of coastal erosion | The future of mass transportation
FOCUS ON : IRAN
THE POLITICAL CLIMATE DOWN UNDER
On Sunday, October 18th 2015 President Barack Obama signed in to international law a ground-breaking new nuclear agreement which was hailed by its supporters as a new dawn for relations between the US and Iran. It was an agreement which would see Iran abandon its plans to develop nuclear weapons, in exchange for the lifting of financial sanctions. With relaxed sanctions Iran has now become more open to the rest of the world, particularly from an investment angle. In this edition, we take a look at the opportunities this new deal could create.
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It has been an incredible few months. With a spate of terrorist attacks, a coup attempt in Turkey and the UK deciding it no longer wishes to remain in the EU, it’s hard to imagine what could happen next. There is however light at the end of the tunnel. The markets are slowly stabilising, the UK government seems to have appointed a good leader and most importantly, house prices and investments have continued to rise. With this in mind, where should we start?
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Credits Individual Samantha Jones, Hannah Wilde, Rachel Sharman, Alex Timperley, Will Leyland, Emma Martin, Richard Ellis, Alistair McGovern, Suzanne Todd, Callum Whiteley, John Power, Martin Copeland, Michael Vickers, Mark Williams, Stella Nicol Commercial Knight Knox, X1, Fortis Developments, Forshaw Land & Property Group, Buy Association, INTUS Lettings, Gold Key Media, Shutterstock, Property Investor, Starin Red Spot Media Solutions, CODA Studios Ltd
Transport is something we all require, be it for our own personal use or for the goods we consume. The industry is always looking for ways to streamline their processes; to improve the service they offer. This constant state of evolution has spawned some pretty exceptional enterprises. GPS thought it was high time to examine what the future could hold. Australia on paper looks like the poster-child for perfect fiscal policy. House prices have increased 36.6% in the 4 years from March 2012 and real GDP grew 1.1% in the first quarter of 2016, marking its 20th consecutive quarter of growth. It’s this strength that has seen vast investment from overseas, as investors look to protect their capital in what some would call a recession-proof economy. With such strong credentials it seemed fitting to make Australia our main section. And finally we take a look at the effect of the EU Referendum vote. As a magazine specialising in property it’s no great surprise that we would recommend investing your long term capital in to the sector, but there’s method behind this. We outline what you can expect to see from a market short on housing, but high on rental demand. Until next time, enjoy the latest edition.
Editor-in-chief Michael Smith
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MARKET IN FOCUS Iran
Words : Will Leyland | View : Alexander Mazurkevich
“The restrictions and censorship in Iran are a bit like the British weather: one day it’s sunny, the next day it’s raining. You just have to hope you walk out into the sunshine.” Asghar Farhadi
countries. It was an agreement which would see Iran abandon its plans to develop nuclear weapons, in exchange for the lifting of financial sanctions. In March of this year, less than 6 months after the ink had dried on that paper Iran had launched two ballistic missiles emblazoned In the records of history there are a select number of countries and nations with “Israel must be wiped out” in Hebrew. This, it would seem, is not the that can match The Islamic Republic of Iran in terms of historical behaviour of a country that (as it had claimed) wanted better relations with significance and contribution. Host to some of the most ancient the rest of the world. archaeological finds in human history as well as the central jewel in the crown and birth place of The Persian Empire, Iran is one of the most International communities often seek to evaluate their contemporaries culturally significant countries on the planet yet it represents an enigma. based on things such as human rights and a democratically elected For all its glorious past and historical global influence Iran is in an exclusive government. Iran runs a complicated and opaque power structure within club in world politics currently occupied by the likes of North Korea and its government. It does, like many other countries, have a parliament and Russia. The members of this club are seen by the west and more elected president but this is seen by most in the country as a nod towards specifically the USA as terrorist funding nations, and are subject to democracy rather than the embracement of modern democratic values. In crippling financial sanctions. The climate in modern day Iran is often hard a country with a total population of about 65 million people a massive 46 to unravel, with many describing fear, censorship and stifling government million are eligible to vote. Iran has extremely high voter turnout so it’s fair interference whilst on the opposite side government propaganda and to say that the appetite is there for the democratic process. However, accounts by officials would have us believe that the republic is a beacon democracy will always struggle to thrive in a country that is run by a of freedom and expression. dictator. Ali Khamenei is The Supreme Leader of Iran and has direct responsibility over the armed forces, controls the military intelligence and On Sunday, October 18th 2015 President Barack Obama signed in to security operations, and has sole power to declare war or peace. Iran international law a ground-breaking new nuclear agreement which was often seems like a country caught between modernisation and traditional hailed by its supporters as a new dawn for relations between the two values. Although in the context of a Middle Eastern government it is
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Tehran, Iran
tempting to view the country as fairly liberal this betrays the fact that ultimately, Iran is run by one man. In order to unravel the complexity of its modern arrangement it’s necessary to look back to recent history. To speak of Iran without highlighting the monumental achievements of the Persian Empire, which was centralised in modern day Iran, would be doing such a historically significant area a disservice. The first public post office, cement and brick sewers, glass, numeric systems, modern mathematics, freedom of religion, paper money, chess, banks, the first written laws and constitutions...We could go on for some time but this was the world’s first great empire and to list all its achievements would require more than 2,000 words.
stability. Iran had only 250 kilometres of railroads and 2,400 kilometres of gravel roads in 1925; by 1938 these totals had increased to 1,700 and 12,000 kilometres, respectively. The government managed the expansion of international trade by techniques such as the foreign exchange controls imposed in 1936
Reza Shah Pahlavi, who abdicated in 1941, was succeeded by his son, Mohammad Reza Shah Pahlavi (1941–79). Between 1954 and 1960 a rapid increase in oil revenues and sustained foreign aid led to greater investment and fast-paced economic growth, primarily in the government sector. Subsequently, inflation increased, the value of the national currency (the rial) depreciated, and a foreign-trade deficit developed. In response to these setbacks, Iran initiated its third economic development plan A rich history is no indicator of a progressive future however and under (1962–68) with an emphasis on industrialization. Under the fourth and the the rule of The Shah, Iranians had come to be increasingly frustrated with a fifth economic development plans (1968–73; 1973–78), the Iranian economy lack of social mobility and opportunity. The Pahlavi era of Iranian rule became increasingly open to imports and foreign investment. A consisted of the last Persian rulers in history. Stretching from 1925-1979, combination of oil revenues, public spending, and foreign and domestic this stage of Iranian history saw radical and previously unseen changes to investments enlarged the middle class in major cities, particularly Tehran. the economy and social structure of the country. Reza Shah Pahlavi (1925– It was this new found wealth and newly formed middle classes that paved 41) improved the country’s overall infrastructure, implemented educational the way for an undercurrent of resentment and tension in the country. reform, campaigned against foreign influence, reformed the legal system, Although economic prosperity was growing and the population were, and introduced modern industries. During this time, Iran experienced a generally speaking, becoming wealthier it was by no means an equal period of social change, economic development, and relative political ascent for the majority of the population and a country that had relied
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heavily on agriculture was now seeing most of its poor being driven further in to poverty by a lack of opportunity to work.
riots) it was not until the late seventies that Khomeini returned to the country after being exiled for 15 years. These factors finally combined to ignite the touch paper of revolution and on January 7, 1978, an article Then in October 1977 something momentous happened. In unprecedented (“Iran and the Red and Black Colonialism”) appeared in the national daily scenes demonstrations started to pop up across the capital city Tehran Ettela’at newspaper. Written under a pseudonym by a government agent, it against The Shah. There have been endless theories advanced over the denounced Khomeini as a “British agent” and a “mad Indian poet” conspiring to sell out Iran to neo-colonialists and communists. years about the causes for the disruption, but the most convincing are conservative backlash to westernisation of the country, a liberal backlash to social injustices and a reaction to a booming then contracting economy Upon the publishing of the article, religious seminary students in the city of Qom, angered over the insult to Khomeini, clashed with police. which stoked unrealistic expectations. In reality it’s widely considered to be a mixture of the three. The Shah had been successfully boosting the According to the government, two were killed in the clash; according to nation’s economy for some time but when oil revenues started to boom the the opposition, seventy were killed and over five hundred were injured. In a consolidation of the protests it was demanded that the protestors’ people of Iran had began to get used to the high life and weren’t accustomed to dips and contractions. Another large issue for the Shah was funerals adhere to Shi’ite customs and be held forty days after death. This that as his regime continued to make progress on the economy, corruption gave the protestors ample time to organise large scale protests at the and oppressive practices became commonplace. As westernisation of the funerals that escalated rapidly in to full scale riots. Protests and riots nation increased, so too did bad feeling towards an administration that was eventually spread across the country and an increasingly desperate Shah viewed as a puppet of the western nations and in particular the U.S. was becoming known for incompetence and panicking when making decisions. On the 2nd December 1978 the infamous Muharram (named after the holy Islamic month they were held) protests begun and an Amidst this anti-government and anti-western sentiment was Shia cleric estimated 10% of the entire population of Iran took to the streets to Ayatollah Ruhollah Khomeini, who was leading the opposition to the government. Although he had been a prominent opponent to the demand the resignation of the Shah. The Shah finally obliged and fled the country allowing Ayatollah Khomeini to return to the country in order to government for decades (he was arrested for 8 months in 1963 sparking
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Area: 1,274 km2 Population: 15,232,564 Density: 12,896/km2
Tehran, Iran
take religious and political power for life. Sadly for those on the left that had supported revolution in the hope of social liberalism it soon became apparent that Khomeini was not a supporter of things such as women’s rights or freedom of speech. The new Ayatollah, finding masses of support, soon began to bring religious oppression to Iran and returned almost all of the infrastructure and business in Iran over to state control. The following 37 years would not be kind to Iran. Fast-forward to the modern day and not a great deal has changed. The political structures enacted in 1979 still remain in place today. The original Ayatollah was replaced, after his death, in 1989 by Ali Khamenei, another Muslim cleric, but the difference between the two barely registers. The big change, it must be said, is that Iran now fosters a popular appetite amongst its people for closer ties and better relations with the west. After years of struggle post-revolution the willingness for radical solutions and conservative politics has now waned. Despite the sanctions imposed by the west, the capital Tehran is a hive of activity with new buildings and infrastructure projects springing up on a regular basis. The former foreign secretary to Tony Blair’s government Jack Straw, who once branded Iran as part of ‘the axis of evil’, is now a regular visitor to the city, and has even said that it now resembles Madrid or Athens rather than Mumbai or Cairo. The economy hasn’t seen the apocalyptic destruction that some had expected in the late 20th century and still moves along slowly, if recently becoming a little stagnant. One of the few sectors in Iran that moves quickly and upwards, though, is property. Building is booming in Tehran as affluent Iranians, seeking a safe investment for their savings, are buying up urban property almost as fast as gold, further accelerating the already breakneck speed of construction. Speculators scour desirable neighbourhoods for lucrative parcels of land and, in north Tehran, apartment buildings no more than a decade old are often torn down to make room for luxurious high-rises catering to the rising standards of wealthy urbanites. The housing sector has seen the success of countless get-rich-quick schemes, but is a source of existential stress for locals trying to stay afloat in the deteriorating economic climate. Building sales have had a devastating impact on evicted renters whose returned deposits are worth just a third of what they were a year ago. The rental of an average flat demands a deposit of around $6,000 (£3,800) – a small fortune in a country where the average worker earns less than $200 a month. With Iran’s annual inflation rate at 27.4%, property hunters must scramble for new leases to prevent the value of their original deposits from depreciating even further. Reasonably priced housing is a rare commodity. The government are encouraging foreign investment and, on this basis, you’d have to say it may well be worth looking into, but suspicions of Westerners are still running high so visiting the country yourself to seal the deal may well be out of the question if you value your safety. Iran then is a country of contradictions and enigmas. A country that has been one of the great contributors throughout modern history, founded on, and proud of its liberal heritage, but struggling to define its identity. A bloody and costly revolution based on anger and hatred of a monarchy that was seen to reject and betray traditional Iranian principles gave way to a brutal and oppressive regime that is now suffocating under international pressure and is seeking to build bridges. Whatever the future may hold for this beautiful, complex nation we can only hope that it brings the peace and prosperity that it was once famous for and that its people deserve.
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Azadi Tower, Tehran
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SETTING UP SHOP A guide to commercial property
Words : Rachel Sharman | View : Peter Gudella
Across the globe, property has always been one of the most popular investments. Whether prices are rising or falling, there is always the knowledge that, on a fundamental level, people need buildings. Property has a tangibility many other investments simply cannot offer. Although the real estate market may not always perform how investors want, it’s easy to follow and often makes more sense than other less-concrete investments. It is this tangibility and ability to take stock of all the world’s properties and their values which makes it possible to calculate exactly how much the real estate market is worth in total. US$217,000,000,000,000 (two hundred and seventeen trillion dollars) is the recent estimate global real estate agents Savills came up with for the total value of developed property around the world. This includes every office, house, hotel, apartment, factory... the list goes on and on. Whilst some of this real estate is residential, much of it is made up of commercial properties. Briefly put, a commercial property is a property used for business purposes. That’s about as specific a definition as can be, as there are
hundreds of varied types of commercial properties. Although there are some outliers, for the most these can fit into four main categories: > Industrial and Logistics > Offices > Leisure > Retail This article will delve into the world of investing into these categories, looking at current trends and forecasts for each industry going forward. Suggestions for a ‘safe investment’ and ‘risky investment’ will be provided in each category. These are not official advice, only areas which have been highlighted by experts as potential commercial property hotspots. Industrial and logistics Industrial and logistics properties can range from factories to vineyards. According to the Paris Convention for Protection of Industrial Property, “industrial property shall be understood in the broadest sense and shall apply not only to industry and commerce proper, but likewise to
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Oil Refinery, UK
agricultural and extractive”. However, in recent years the sector has been increasingly defined by the growing demand for the warehouses, processing facilities, and other buildings needed by online retailers. Shopping online is becoming more and more popular around the globe and, with this increased popularity, customers expect an efficient service, including quick deliveries and cheap returns. In the last decade there has been a surge of logistics centres created to cater to these needs, and going forward it seems that more and more will become necessary. Out of all the types of commercial properties available, the industrial and logistics sector saw one of the strongest recoveries following the global recession. Perhaps this is because of the market being seemingly ‘future-proof’ as it caters to an ever-growing audience.
comparison to 10% in the USA and 15% in the UK). However, many expect this to change in the coming years. This is not only due to the ever growing popularity of online shopping, but also to the ageing population of Japan. The convenience of shopping being delivered to your front door is likely to appeal to the older generation. Riskier Investment - Cape Town Africa is a bit of an untapped market in terms of commercial property investments. Although there has been no shortages of foreign companies making the most of the continent’s natural resources throughout its history, there isn’t the same level of interest in other types of investments. Alongside this, there has been less inward investment than many other continents.
Safer investment - Japan It’s not very surprising that one of the most innovative countries in the world has a high demand for manufacturing and industry. Currently, only 5% of Japanese shopping is carried out online (in
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However, in 2010 South Africa joined what was then known as the BRIC nations (a block of countries with large growing economies made up of Brazil, Russia, India and China) which proved the country’s status as a strongly developing country and its status as a good destination for foreign investment. Cape Town is South Africa’s most diverse and
modern metropolis, making it a good potential location to invest into the industrial sector.
Angeles, USA or Silicon Fen in Cambridge, UK). In addition, offices are increasingly expected to be environmentally conscious as well.
Offices
Ultimately these popular investments are places where people want to come in to work, especially young talent. They’re innovative, open-plan and offer something completely different to the failing model of 1980s office blocks.
Office space makes up by far the largest sector of commercial property (covering over a third of total trading), but investment levels have been declining since 2008, just prior to the global recession. Unlike other types of commercial property, the demand for office space never quite bounced back. Today the need to have an office is increasingly called into question. The 21st century information age means that people can often access their work remotely and have no reason to go to an office on a daily basis. Offices can be expensive reminders of the past. So perhaps it is no surprise that some of the most popular types of offices to invest in right now are direct counters this perception. The demand for fun, high-tech and downright quirky offices is soaring, especially in cities with significant tech and creative scenes (think Silicon Valley in Los
Safer Investment- Germany Germany is a great example of a country full of cities bursting with fresh talents and businesses. The first quarter of 2016 saw the strongest office take-up in five years around the whole of Europe, perhaps suggesting that the bounce back is finally happening and now is a good time to invest, and Germany is at the centre of the action. According to the JLL Q1 Market Perspective, “Germany was again the star performer in Europe, with the combined Q1 take-up for its five largest markets 16% higher year-on-year”. If you’re interested in investing into the German office market you could
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look at Berlin where “office leasing volumes are more than double the 10-year average,” or maybe Frankfurt, which had been slightly stagnant in comparison to the country’s other cities, but enjoyed a booming Q1 2016. Riskier Investment - Eastern European Cities The increasing importance of Chinese and Indian economies on a global scale means many Western businesses are scrambling to access and accommodate these new markets. Eastern Europe is on the doorstep of Asia which has the benefit of a less severe time difference with Western Europe. Offices in Eastern Europe can also promise well-educated staff with relatively low labour costs. Investing in offices in Eastern Europe can also be notably cheaper per square foot than the Western alternative, with yields which can be far more lucrative. Prime yields in Moscow and Warsaw were amongst the highest in Q1 of 2016 at 10.5% and 5% respectively. Leisure Investments which fall under the ‘leisure’ category of commercial property include cafés, sports facilities, bars and most other buildings used for recreational activities. The leisure sector is one of the easiest categories to predict for investors as it often goes hand in hand with the tourism industry. Global events (sports tournaments, music festivals etc) are sure to boost the popularity of an area for that period. The most important and the biggest business in this category concerns the hotel industry. Alongside industrial and logistics, hotels have seen one of the strongest recoveries from the recession. Travelling the world is unlikely to ever go out of style and, with people increasingly having to visit different countries for work, hotels are doing very well. Hotel investments can also appeal because of their hands-off nature. An investor can buy a few rooms at a certain hotel and beyond that it is the hotel’s job to keep the room occupied, clean and profitable. Safer Investment - Australia The value of the Australian dollar has fallen dramatically in the last few years – devaluing at 36% vs the US dollar - meaning that Australian properties can seem up to 36% cheaper to overseas buyers. Obviously, this makes the whole country a hotbed for foreign investment of any sort. Australian particularly excels in the leisure category of commercial property because Australian tourists are choosing to holiday at home rather than lose out on the exchange rate by going abroad. It makes the country very appealing for nearby nations whose tourists can visit now for a lot less money than they would have a few years ago. Riskier Investment - Vietnam Although it may not be your first thought when it comes to a holiday destination, Vietnam ticks a lot of the right boxes: beautiful scenery, warm weather, and a long coastline. Because of this, many are predicting that its tourism industry is set to boom in the coming years. Vietnam offers a viable alternative to other more tradition holiday destinations which are in financial trouble, such as Turkey, Spain or Greece. Russian and Chinese tourists in particular are beginning to look very seriously at Vietnam. The entire property industry in Vietnam enjoyed a very strong 2015, with almost all sectors growing stronger and producing better yields. Retail Retail is the final main category of commercial property. Although it may be expected that the global rise of online shopping would result in the retail market suffering, it has proven to be resilient and has continued growing. The retail industry has taken 4% more of the investment property market share in the past 7 years. Ultimately, this is down to the general worldwide trend of increasing wealth and the expansion of the global middle class. Consumer
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Office Property, Sydney
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Retail Property, Singapore
spending directly correlates with both of these factors and retail properties have continued to flourish. That isn’t to say that all retail investments are definitely going to be profitable. In Europe it seems one of the keys to success is choosing to invest in big cities where growth has been most prevalent. On the other hand, in the USA secondary markets are currently doing better than primary markets which are seeing high levels of over-saturation. In these slightly uncertain times there is no certain solution. Safer Investment - Dublin The retail sector in Europe has been strong so far in 2016 with Dublin at the forefront of this growth. The first quarter of the year saw retail rents in Dublin rise by an impressive 4.4%. Ireland’s economy in general is recovering from the deep recession it entered after the 2008 financial crisis. Dublin’s retail market isn’t expected to slow down any time soon. Experts at JLL predict that prime high street rents in Dublin are “predicted to
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experience the healthiest growth to the end of 2016”. This means that investing into Dublin’s retail sector now could produce very strong returns immediately which don’t stop growing until at least the end of next year. Riskier Investment - São Paulo São Paulo has secured its place as a riskier investment because of the sharp drop in the value of local currency. On paper São Paulo is an interesting place to invest in the retail sector: > It has a growing population as more people choose to move from rural areas into the city > São Paulo is popular as a base for doing business > The market is currently at its lowest point, an inflection point in the cycle signalling a return to strength However with no one quite knowing how the Olympics will affect the whole of the Brazilian economy, São Paulo, with its low prices and
reliance on overseas investors, may take some time to recover fully into a prime investment market. Benefits and drawbacks of commercial property As with any investment, although experts may predict a certain area is set to flourish or fail, it may behave completely differently. Commercial properties can definitely produce lucrative yields; however they can also find themselves falling out of fashion, as seen in the office market. Ultimately, choosing the right commercial property to invest in requires individual research into both the type and right area. This is why the residential property market is usually favoured by most investors. It is often more familiar territory and the market is more widely reported on, allowing investors to keep up to date on information easily. Additionally, the demand for homes is never going to go away. The different categories of commercial properties can both rise and fall in popularity, but an increasing global population means there is always going to be a need for new homes.
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For more information, contact: Tel: 0161 772 1394 Web: www.fortisdevelopments.com
TRAVEL OF THE FUTURE As the population continues to soar, the pressure continues to build on the next mass mode of transport
Words : Emma Martin | View : Barone Firenze
In 1985, iconic sci-fi blockbuster ‘Back to the Future’ hit cinema screens. The futuristic film projected a picture of what life might be like in 2015 depicting inventive, far-fetched technology including hover boards, video calls, flying cars, fingerprint recognition, and hands-free gaming. These innovations were all beyond reason for the time—but in retrospect, Robert Zemeckis’ brain-child really wasn’t too far off the reality we find ourselves in today. While the flying car is still firmly on the drawing board (for now), most of these technologies have found some form of existence in 2016 - car company Lexus has even engineered a working hover-board inspired by the hit film! Though for all of Doc Brown’s wacky inventions, Back to the Future had one clear, unquestionable focus: travel. Finding new ways to streamline movement from place to place has been a fundamental part of human development since the beginning of civilisation. Whether it’s commuting to work, delivering goods, holidaying, or simply getting from A to B – the ability to travel, quickly and safely, is essential to us all. Unsurprisingly, the Travel and Tourism sector is one of the greatest drivers
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in the global economy, having generated a massive 10% GDP in 2014. It’s a key player in terms of cultural growth, job opportunity, and trade, generating over 1.5 million jobs in 2014 alone. Within a diverse industry made up of a myriad of different private and government-funded companies comes new and inspiring projects that are pushing the limits of travel as we know it - striving to create a faster, cheaper, and more reliable service than ever before. This constant state of evolution has spawned some pretty exceptional enterprises, as industry experts seek to keep up with customer demands. So we’ve rounded up some of the incredible ways scientists, designers and engineers are looking to redefine the future of travel for all… Space travel – it’s really taking off… Rewind to 1955: 1955 saw one of the greatest races for technological, economical, and scientific superiority commenced between Soviet Russia and the United States of America: The Space Race. Fourteen years later, Neil Armstrong
Space Shuttle, NASA
Mercades F015, Driverless Car
became the first man to step foot on the moon, inspiring a generation with what is considered to be one of the most celebrated steps in human exploration. The twentieth century opened up a whole new world (or universe) of possibilities. For the first time mankind could experience the marvels beyond planet Earth. For a long time; however, this remained a dream for most, a privilege reserved for trained NASA astronauts. Fast forward to 2016: We are now tantalisingly close to bringing that previously inconceivable experience to the mass market. With 553 people having joined the elite ranks of ‘space traveller’ already, this number is set to rocket… Headed up by British business tycoon, billionaire, and co-founder of the Virgin group Richard Branson, Virgin Galactic is an exercise in travel innovation aimed at providing suborbital spaceflights for all to experience. For the first time in our history, space tourism is on the horizon. For the lavish price tag of $250,000 you can book a seat on a future expedition,
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and rub shoulders with A-listers (and future ‘Space Agents’) Leonardo DiCaprio, Brad Pitt, Justin Bieber, and even Lady Gaga. Each voyage into space will comprise of a three-day intensive course to prepare for macrogravity, as each attendee learns how best to experience their space expedition for ultimate comfort and pleasure. They will then be checked out by a specialist team of aerospace medics before getting into a custom fitted spacesuit and boarding SpaceShipTwo ready for launch. Propelled into the atmosphere at three times the speed of sound, those aboard will feel the thrill of the G-Force created by a rocket motor, before finally experiencing true weightlessness as they reach their destination— space. However, the road to intergalactic travel for the masses has not been smooth. Virgin Galactic faced a huge setback in 2014 with the fatal crash of their first test flight over California’s Mojave Desert, causing demands for refunds from many of those signed up for early flights. Despite the tragedy, Virgin Galactic has not allowed the worst to overcome them. The project has maintained its initial momentum, with new test flights being carried out over the course of the year, and their second spaceship - aptly named
‘SpaceShipTwo’ - launching back in February. Whilst these tailored expeditions have yet to be delivered (or a date for launch officially set), it’s rumoured that a private letter was sent to the wealthy space agents already signed up, outlining the date for opening as being set at the end of 2017. Driverless Cars Back on Earth, autonomous motors have come on leaps and bounds in recent time, and make for an interesting prospect in the world of travel. Imagine a world where there was no need for someone to be sat in the driver’s seat - and instead we place our trust in a car that is aware of its own environment, able to steer, manoeuvre and brake independently of those who occupy it. It may still seem an incredible concept to many, but the automotive industry is currently working on this ground-breaking technology that will truly see the way we drive change forever (or even replace it altogether). With the average American driving 16,550 miles per year, it’s astounding to
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think of the amount of time we spend on the roads. Imagine how your life would change if you didn’t have to be at the wheel – you could catch-up on your business emails, watch your favourite TV show or read the latest Times bestseller whilst still travelling from A to B. The technology is based around a detailed map of the area of usage, which is uploaded in to the car’s computer system and fitted with details of traffic lights, crossings and one-way streets. There are many pros to this new automotive technology: > It eradicates major issues associated with human error. > Allows us all to have the freedom of movement regardless of age and ability. > Insurance premiums will be set to drop dramatically, with the amount of driver claims plummeting. > In terms of eco-friendly travel, driverless cars present a good option for the future, making travel sustainable by using electric charged vehicles in the majority. US brands Google and Tesla have taken on this innovative revamp of road
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vehicles (Google have already got a monopoly on GPS-led directions with the widely used Google Maps app), having already put prototypes on the roads - with almost all major car companies expect their first robotic vehicles to be available in showrooms across the globe by 2020. However, the change isn’t planned to be just reserved for those who want to swap in their own car to an automated version—Uber, one of the fastest growing automotive-reliant companies of the last few years, have teased that they expect their whole fleet to be driverless by 2030. This just goes to prove the extent to which this technology will soon become a normal part of day-to-day life. The Hyperloop Entrepreneur Elon Musk, CEO of SpaceX and the mind behind Tesla Motors, is nothing short of ambitious when it comes realising the full potential of a new travel based project: The Hyperloop. The principle comprises of a series of pressurised tubes that will propel goods and travellers across country at supersonic speeds based on a low pressure atmosphere. The Hyperloop is designed to sit atop a level of air, and linear induction motors will see the carriage thrust through the low
Hyperloop
pressure vacuum tunnel, delivering passengers to their destination at speeds in excess of 760/mph. Whilst it might seem out of this world, the development for the Hyperloop is working almost as fast as the system itself—Hyperloop One’s ‘Innovation Campus’ in Downtown Los Angeles boasts a 55,000 square foot manufacturing and development space in which a dedicated team of over 150 are working continuously to bring this state of the art travel concept to life. As innovative as the Hyperloop undoubtedly is, this technology isn’t entirely new, taking inspiration from the Shanghai Maglev Train - which draws on magnetic force to levitate the carriage above track. This process prevents friction and allows the train to achieve speeds almost double the previous record of the Japanese Bullet Train currently in service – potentially revolutionising train travel. Hyperloop aims to trump all predecessors, and claims the technology would make it possible to travel between San Francisco and LA (equivalent of the length of Britain) within 30 minutes. This would eliminate problems relating to long-distance travel, as well as reduce road congestion and pollution associated with traditional means (plane,
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train, and car). However, it’s not been all plain sailing thus far for the Hyperloop: sceptics have outlined some key problems relating to the design, including the massive cost of the project, issues around where it would be built, not to mention the safety concerns of mechanical failure and fatalities should something go wrong at such high speeds. Despite this, Hyperloop is currently aiming to create a fully working prototype to prove their system, and consultant Knut Sauer confirmed that the company are confident that a prototype will be ready by the end of 2016 – taking them one step closer to bringing this concept to realisation. Virtual Reality Linked closely with gaming and entertainment, virtual reality is under new development to stretch our imaginations past our environment. Oculus Rift were one of the first to bring virtual reality to the market with their simulating goggles already available for sale, aiming to beat out competition from Xbox, PlayStation and other major players with an overwhelmingly realistic gaming experience. But what has it got to do with travel? Well if launching yourself into the stratosphere just isn’t up your street, then the Marriott Hotel group have come up with a pretty remarkable alternative that looks to trump even Oculus Rift. The 4D Teleporter is a brand new, ground-breaking sensory experience that sees users transported in seconds to dream holiday destinations around the world. Using immersive multimedia that can simulate you being in a place far removed from your actual environment, Virtual Reality (VR) can bring a destination to your doorstep. Imagine the ability to be able to step into the teleporter, put on the goggles and immediately you are in Hawaii – you can experience the humid heat of summer, the smell of salt in the air and the spray of the sea on your skin. Able to alter your temperature and moisture as well as sound and sight, this is entertainment technology never before available. At the moment the teleporter is currently limited to only two destinations, but this will no doubt be expanded and rolled out as the technology is bought into use. Beyond the 4-D Teleporter similar technology could change the way we book and experience travel. Tourism companies may use similar equipment to enhance their customer experience with snippets of hotels and rooms before booking or being able to have a taster of the destination you’re next thinking about going to before paying. It may seem a while off until you’re planning your next holiday to outer space or reading the next bestseller on your way to the office whilst an automated car safely delivers you to your destination, but we are all undoubtedly racing towards a future where we will no longer be restricted by distance or time. Although not all of the concepts discussed are commercially viable yet, 21st century living has come on leaps and bounds, and shows no sign of slowing down. As long as there are improvements to be made there will be competition to deliver the next breakthrough technology and it’s sure to wow – so watch this space.
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Morpheus virtual reality headset, Sony
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LIFE DOWN UNDER GPS takes an in depth look at the political climate in Australia
Words : Hannah Wilde | View : Boyloso
Australia is an anomaly. Perhaps one of the most complex economies in the world, what looks on paper like a country with a sound fiscal position is actually a country in political and financial freefall. The picture you get of this majestic country at first glance is one of stability and prosperity, but the reality couldn’t be more different. Far from being infallible, Australia’s economy is at breaking point, with cracks already appearing that are so deep that they could threaten to completely destabilise the entire nation. This proves that all is not what it first appears… Australia on paper looks like the poster-child for perfect fiscal policy. House prices have increased 36.6% in the 4 years from March 2012 and real GDP grew 1.1% in the first quarter of 2016, marking its 20th consecutive quarter of growth. Incredibly, the economy also appears almost recession-proof—it has been 297 months (nearly a quarter of a century) since Australia showed two or more quarters of negative real GDP, the only developed economy in the world after the Netherlands to have achieved such a feat of uninterrupted growth. In theory, Australia’s present and future should be rosy. But all is not well down under, with national debt at crippling levels, a housing market nearing bubble-bursting territory and a political environment in absolute turmoil. Let’s investigate the Australian economy under the microscope, seeing just how the country’s fiscal policy, housing market and political environment has led to one of the most confusing—yet intriguing—economies in the developed world.
Australia’s housing market Currently, Australia is riding atop a housing bubble. A continued and exponential growth in some of the country’s largest and most expensive markets has led to house prices in its three largest cities rising by a collective 115.4% since 2012. Sydney is by and large leading the way at 57.5%, followed closely by Melbourne (39.4%) and Brisbane (18.5%) respectively. The median house price across the country now stands at AUS$580,000, with Sydney even eclipsing this. Prices in arguably Australia’s best-known city are in excess of AUS$782,000 —a price not too dissimilar to an average home in the UK’s capital city of London. Australia has certainly been riding high on house price growth for over 25 years. Prices have grown 350% since 1990 so naturally rather than a question of “if”, Australia’s house price tumble will more likely be a matter of “when”. Economists have predicted that house prices will begin their descent slowly in the coming year or two, before falling more rapidly towards the latter end of the decade. Whilst this is indeed a cause for concern, Capital Economics’ Paul Dales has tried to mitigate the impending bubble burst by his admission that “lending conditions during the good times have not been as loose as in America, and Australian banks are better-placed to cope with the bad times”. This indeed could be Australia’s saving grace—although Australia’s house prices have grown
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three times as much as the pre-crash USA, Australia has not been as foolhardy with lending during its peak, with just 9% of mortgage loans issued to borrowers with a deposit of less than 10%, whilst the US during their boom lent in excess of 29%. One of the catalysts for Australia’s inevitable house price drop will be when the Reserve Bank of Australia (Australia’s chief central bank) finally raises interest rates, which have been at historic lows in recent years. If Australia’s interest rates do rise in 2018 as predictions foretell, there is expected to be a steady decline to the tune of around 10% after the event as the market uses this decline to rebalance and stabilise after the years of stratospheric growth. The OECD rather dramatically surmises: “Australia may be on the cusp of a ‘dramatic and destabilising’ end to the housing boom rather than a hoped-for soft landing”. This bubble burst could cause untold problems for an economy already teetering on the edge. Fiscal policy Daily Reckoning Australia sums up the problems in Australia’s economy almost in a nutshell: “While production may be up, the prices received for that production are way down”. Australia is indeed full of such contradictions where fiscal policy is concerned—strategist company AlphaBeta condenses all Australia’s problems into one giant oxymoron: “Production is strong but incomes are weak, [which is] why we can simultaneously have record export growth with falling company profits, strong employment growth with low wages, and strong GDP growth with a crippled budget deficit”. In other words, Australia is a big wheel that keeps on turning—although not necessarily in the right direction. To make matters worse, neither of the country’s mainstream political parties—Labor nor the sitting Liberals—know how to resolve these problems, nor have a comprehensive plan of how to ease the economy from a growth model entirely dependent on borrowed money. This debt dependency when first implemented was only ever envisioned as a short-term strategy, but it is now very much engrained into national fiscal policy. Australia’s outstanding gross debt level has risen from $55bn in 2008/09 to an estimated $427bn in 2015/16, a huge 676.3% increase that marks the fastest growth of any AAA-rated developed nation over that period. As debt continues to climb, they cannot be serviced without a measured increase in wages—a move which, much to the chagrin of hard-working Australians, isn’t even visible on the horizon any time soon. Furthermore, the fact that house prices are so elevated makes incomes look even more deflated, which does nothing for the pockets nor the motivation of Australia’s 11 million-strong workforce. The Commonwealth Bank of Australia recognises this dubious state of affairs, noting that “the composition of growth, coupled with incredibly weak wage pressure and falling inflation expectations, means that the RBA’s concerns about entrenched low inflation and disinflation risks will persist”. The CBA also expects “further monetary policy easing”, as well as “two more rate cuts that would take the cash rate to just 1.25%”, in a hasty and almost gung-ho attempt to combat Australia’s declining fiscal fortunes. However, this could be a move deployed too late. The economy has been in turbulent waters for too long it appears, as leading world ratings agency Standard & Poor’s has officially placed Australia on a warning, revising the country’s credit outlook from “stable” to “negative”. This is a hugely worrying state of affairs, especially as S&P predict a “one-in-three chance” that this move could see Australia lose its prized AAA credit rating in as little as two years because of “growing fiscal vulnerabilities”. Although seemingly trivial, this credit downgrade could spell yet more trouble for the country, potentially setting into motion a chain reaction— international investors could be deterred from investing much-needed capital into the debt-laden economy, which in turn would increase the need to borrow yet more money to support itself, to almost cyclical effect. S&P’s Associate Director Anthony Walker makes the company’s position very clear, urging Australia to act now to prevent the potentially-damaging repercussions: “There have been a number of years with fiscal slippage, and it’s really time for the [Australian] Government to really step up and deliver what it is telling us [it will achieve]”. The last time Australia lost its triple-A rating was in September 1986, taking 16 years to recover, regaining the coveted status once more in the August of 2002. This shows that the economy can and in fact did recover from the fiscal rebuff of losing its top sovereign credit rating, but
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Sydney, Australia
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Melbourne, Australia
chief economist from consultancy CGP doesn’t share the same sanguine outlook: “We’re now looking at a worse run of budget deficits than we saw when the rating was cut in 1986—we’re facing years of slippage in return to surplus. It’s probable that a formal downgrade will follow unless the new Government is able to hold the line on the budget deficit projections, which will be hard given the likely state of the Senate”. It’s not all doom and gloom though—despite their dubious financial position, Australia still has the 12th largest economy in the world, with GDP growing 3.1% in the year to March 2016. Furthermore, the end could be in sight for Australia’s calamitous fiscal situation: both political parties have set a 2021 time limit to return the budget to balance, a deadline S&P threatens must be met in order to avoid the downgrade looming over the country (despite naysayers’ scepticism that without strong fiscal policy, the return to surplus may not be achieved by 2021 due to the conflicting parliamentary troubles, unlikely to improve in the near future).
history, Australia has been burning through governance like yesterday’s news, having had five Prime Ministerial changes in as many years. This shows that the political landscape is unravelling. Australian politics can be defined by three main catalysts: untrustworthy politicians, disenfranchised and demoralised voters, and not one political party with a lasting foothold on national governance. It’s clear that this process is entirely chronological—what begins with politicians losing the trust of their constituency by failing to deliver on electoral promises of growth, sustainability and easing economic deficits then translates into frustration among the voting population. This in turn leads to a no-confidence vote by the population at large, using their voting power during elections to seek out alternative political parties, refusing to vote for the mainstream parties who have thus far failed them. This then puts into motion a vicious cycle as more independent and minor parties enter the mix, making it harder for the governing party to maintain control.
Never has this been clearer than the past Australian Federal Election which took place on 2nd July 2016. Governance was once again contested This leads us onto Australia’s equally dubious political environment. One of between the current coalition government of the Liberal-Nationals and the the many negative factors hindering the country’s precarious fiscal position oppositional Labor party which came to a head in yet another election, the results of which were so varied that it took over a week for the country to is the political instability that has rocked the country of late. In recent Political landscape
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find out which party had been mandated. At the time of writing, we know for certain that coalition leader Malcolm Turnbull has de-facto won the election and will lead the country, since opposition Labor did not gain enough seats to claim governmental control. The coalition won by a head, but suffered significant casualties—the Liberals went into this election with a clear majority (90 seats in the House of Representatives out of a possible 150), but by the time the election was conceded by Labor leader Bill Shorten on Sunday 10th July the coalition had secured 72 seats which, as it stands, is three short to form a majority government.
of which Government he will inherit.
In what Jacobin, a New York-based quarterly magazine, calls “the election that solved nothing”, Australia’s newest political commotion gave a clear majority mandate to neither the Liberal-National Coalition nor the Labor opposition, sinking the country further into limbo. Turnbull and his party could still form a majority, but the magazine is scathing of the re-elected Prime Minister, rather savagely commenting that “the only thing saving Turnbull right now is the lack of viable alternative”. As callous as this sounds, apparently this represents the sentiment of the voters, too. Clearly It’s all speculation at the moment as to what will happen, but what we know the outcome of this federal election is the result of Australian citizens’ for certain is that the election will either result in a Liberal-National coalition uncertainty and frustration—they crave the normalcy and political stability that would come from a strong and secure leader, but haven’t for some majority, or a hung parliament, which will see the coalition aligning themselves with a number of MPs from independent or minor parties to years enjoyed this consistency. Echoing the political unrest 15,000 miles away in Britain after their shock ‘Brexit’ decision, Australia finds itself caught make up the number of required seats. It really is impossible to predict between a rock and a hard place—they desperately call out for a new which side the coin will fall—the results which will dictate whether or not the coalition will be able to form a majority government are still coming in leader to spearhead the country to much-needed changes, yet nobody more than two weeks after the election was held, and it’s possible we won’t is in place to respond to that call. As a result, the country has seen rise to know the final tally for another week or more, but many are predicting a alternative political parties like the Greens and other populist minor parties very narrow majority win. Therefore, as Turnbull returns to office for another in an attempt to ease their growing resentment by seeking political consolidation elsewhere. Prime Ministerial term by the skin of his teeth, he well knows that he is inheriting not just the country and its gargantuan problems—problems he has so far not managed to fix in his first term in charge—but the uncertainty
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It’s no wonder Australians are fed up with their political representatives. If this election showed the country anything, it’s that neither mainstream parties can come up with an iron-clad plan for the future. Even Turnbull’s winning manifesto was based on vague promises of jobs and growth, with no real goals and objectives for how these will be achieved. Jacobin comments further that “the real story of the 2016 [Australian] election campaign, despite the attempts of politicos and commentators to obscure it with a fanciful picture of polarisation between the major parties, was that no amount of brand differentiation was able to cut through the high level of voter disinterest and detachment as the weeks dragged on”. This voter disinterest is at the heart of the country’s political unrest, as people no longer have trust in their MPs. According to shocking research collected by the University of Canberra, Australian voters’ dissatisfaction with their democracy declined from a high of 85.6% in 2007 to 42% in March 2016— that’s a huge 43% drop in less than a decade. Furthermore, the same study showed a marked drop in trust of politicians, as well as a significant weakening in party loyalty, as the country’s political parties are tarred as some of society’s least trustworthy institutions. This damning indictment paints a vivid and very real picture of voter frustration, as mutinous feeling grows amongst the voting population that MPs are no longer serving the country’s best interests, foregoing the greater good to further their own political agendas. In this instance I disagree with the post-election quip that “the people have spoken; it’s just not clear what they’ve said”. To me the feeling is crystal clear—the people of Australia want out. They want out of a clueless and selfish political system with no clear direction. However, here marks an inescapable Catch-22: voters’ attempts to bring some stability to the political landscape by voting in minority and independent parties to bridge the gap has in fact widened the political gulf. As more and more ‘alternative’ parties gain Parliamentary and even Senate seats, this makes Prime Minister Turnbull’s job even more difficult. It could make policy-making and implementation nigh-on impossible, as he now has to go against not just the Labor senators to pass legislation, but will also now have to appease a small but incredibly vocal group of spokespeople for other parties too, parties with completely different manifestos, ideas and beliefs on policies and budget allocation. As HSBC’s chief economist for Australia Paul Bloxham surmises: “[The election’s] close result, and potential hung parliament, are likely to make it more difficult to pass budgetary reform, which we see as needed to remedy Australia’s structural budget deficit and help protect its triple-A sovereign rating”. Far from being an election that did nothing, this election has done one clear thing—it has made the top job of Prime Minister that bit harder. Although nobody can be certain what the future will bring for Australia, all we do know is that political gridlock will continue even after the full election results have been announced. As Business Insider Australia astutely observes: “The Senate is looking like a disorderly nightmare for whoever ends up managing to forge a working majority in the House of Representatives—in short it’s a shambles, mirroring the performance of the Australian parliament since 2010”. Political sentiment is at an all-time low from national publications too, with one scathingly referring to the Senate as a “zoo”, and another suggesting that politicians have led the country into a “fiscal policy wilderness”. Annette Beacher of TD Securities has seemingly lost faith altogether, saying: “We’re up for 3 more years of policy paralysis—the RBA is the only one public authority left to steer the economy”. With this political stalemate front and centre in the minds of its citizens, it is easy to forget that the Australian economy has proved its resilience—June 30th officially marked 25 fiscal years of uninterrupted growth, which is a huge feat. However, this will inevitably be overshadowed in the next 12 months by the settling in of the new government (by then it will have been decided whether a majority or a hung parliament), the uncertainty of post-Brexit Europe, the drag from a slow-growing China, and the fallout from America’s increasingly shaky political and economic grounds. Australia will be fighting a battle from all sides in the coming year, with the Commonwealth Bank economists commenting rather astutely that “most of the risks [Australia] are facing in the next 12 months will come from offshore—the problem there is trying to work out where to begin”. I’m sure that’s the question Turnbull will be asking himself now he has been reinstated in The Lodge (the official residence of Australia’s sitting Prime Minister)—but whether the country will sink or swim given its gargantuan problems, only time will tell…
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Parliament of Australia, Canberra
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WHAT HAPPENS NOW? The result is in, and it’s not what we all expected
Words : Will Leyland | View : Kiev Victor
“What’s the plan then?” The Great British public began to ask in the early hours of Friday morning on the 24th June 2016. “Nobody seems to have one” came the answer. As the sun began to rise in the UK on the first day of a Brexit vote a strange atmosphere appeared to be developing among people on the morning commute. A sense of disbelief set in amongst the tiredness of those on their way to work across the country. Before they could even have a sip of their morning coffee there had been an announcement made from Manchester town hall that could change all of our futures forever... by 52% to 48% (with a turnout of 72%, the biggest since 1992) we had voted to leave the European Union. These were unprecedented, unchartered waters and it seemed the sense of shock was profound. A different mood had been developing overnight in the stock markets; an atmosphere of sheer panic had set in. The value of the pound fell off a visible cliff, marking its sharpest drop in history and worst consecutive days in 31 years. The global stock market had $3 trillion dollars wiped off it in the aftermath of the announcement. The verdict, loud and clear, was that markets do not like uncertainty and it was at this crucial moment strong and continued leadership was required to steady the ship. At approximately 9am on that Friday the Prime Minister David Cameron emerged from 10 Downing Street to announce to the world that he would be stepping down from the role to allow ‘new leadership’. The British people had spoken he said, and required fresh leadership. In predictable
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fashion this was not received well across the markets and further turmoil continued throughout the day. British politics had not witnessed scenes like this in decades. It was carnage and almost immediately the prominent Out campaigner Boris Johnson was installed as the favourite to succeed Cameron. Jeremy Corbyn, the Labour leader, was under almost immediate pressure from his MPs about his perceived performance in the referendum. It was felt that his campaigning for the Remain camp had been lacklustre at best and completely fake at worst. Within days he had sacked his shadow foreign secretary for disloyalty which sparked mass resignations from the shadow cabinet leaving only a handful of people willing to serve the leader. A vote of no confidence was called and the leader lost the vote by an astonishingly resounding 80%. Only 40 MPs in the entire party had showed they believed in the embattled leader and this led to the Scottish National Party (SNP) to forward a motion to be recognised as the official opposition. This was ultimately unsuccessful but topped off what could be reasonably considered the worst week of the party’s history. Meanwhile a generation of voters argued that they’d been robbed of their future by an older electorate who were happy to vote with their emotions despite not being around to deal with the circumstances. Whatever your opinion may be on that, the sentiment was strong and just fewer than 4 million people (a record) signed a parliamentary petition to have a second referendum. Tens of thousands marched on the streets of London to protest the result.
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European Parliament, Strasbourg
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So far, so bad then. Although it was a chaotic time immediately after the result, things now seem to have calmed and we’re here to look at what Brexit means for those of us keen to invest our money in the right places in uncertain economic times. Thankfully for most we expect property to remain and continue to be a safe, profitable investment. That isn’t to say there are no risks, but given the correct expectations and information property can absolutely bring stability to investment markets. Since the 2008 financial crash confidence in the markets and across all sectors has been often anxious and fragile, but despite this, gradual economic growth has slowly but surely trundled on. In the aftermath of the Brexit vote though it is in no way certain that this confidence will return quickly. The issue, it seems, is the length of the prospective negotiations that will take place in order to finalise the UK’s position with the EU. There is much to be discussed too. Without entering in to massive amounts of detail things that need to be discussed will include trade deals, immigration, legal positions, environmental policy, defence policy and how the UK proposes to extricate itself from all of these frameworks. Reassurances from senior leave campaigners have hardly been convincing, with many lining up to admit ‘there is no rush’ to trigger Article 50 in order to start these negotiations. Boris Johnson and Michael Gove had insisted that informal negotiations could begin before the formal start of the exit, but German chancellor Angela Merkel was quick to quash these rumours insisting that only official negotiations will be possible, and only after Article 50 has been invoked. Initial estimates were that from invoking Article 50 it would then take the UK two years to negotiate the terms of its exit from the union, but these seem to wildly underestimate the time period that would be required to get back ‘business as usual’. Firstly these initial negotiations only take into consideration the actual ‘divorce’ proceedings of the UK. This the actual process of leaving and which legislation it will retain or revoke. Any negotiations about future trade deals, access to the single market, free movement of people and defence collaboration would take much longer and depending on who you ask would take between five to twenty years to implement. Within this time there are endless complex laws to be re-written and implemented, as well as arranging how the city of London, which at present has unregulated access to European markets, would go about its business with the continent. Certainly there will be testing times ahead regardless of the time frame. This leaves investors in a tricky situation, namely of where they put their money to ride out the storm. There are always safe options in any turbulent time with gold, for example, often being a popular option. Most people tend to like to invest in something tangible and physical when markets descend into panic, so investments in commodities and property are often on the rise at times like these and many experts expect this to be no different after Brexit. All the signs point to at least a short term economic slump, and quite possibly a slump in house prices as we had in 2008. Unlike 2008 though most experts are seeing this as an issue mainly concentrated in London and the South-East. London has been approaching ‘bubble’ status for some time and many had called this as the reaching of a peak as trends were starting to suggest a slowdown in the capital. House prices have been seen by many as unsustainable for a number of years as the increase in prices show no attachment to the realities of other markets and interest rates or even inflation. Wages have been rising nowhere near as quickly as house prices for some time now and with the capital seeing this trend more than anywhere else, there was always concern that a small amount of wealthy landlords were strangling supply to first time buyers and thus artificially inflating the prices. The million dollar question then is what should you expect? Well, unfortunately nobody can give you a definitive answer but we can have as informed a guess as is currently possible based on the information we have. First of all the likelihood is that this uncertainty won’t last for months, it will probably last for years. The Tory party leadership crisis took the country by surprise. At a time when the opposition are in complete disarray, the Conservative Party lived up to its reputation for ruthless effectiveness. Firstly it was announced that Michael Gove, the former Justice Secretary, had essentially stabbed his Brexit campaign ally Boris Johnson in the back by announcing his candidacy and, according to reports, had stolen his campaign team overnight. The mainstream news were barely able to keep up as Boris Johnson announced he would not run for Prime Minister and that Andrea
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European Parliament, Strasbourg
Leadsom, the prominent leave campaigner and rising star of the party, would also run against him with Stephen Crabb and Liam Fox completing the list of nominees. Following a vote from MPs the list was reduced to two and it was revealed that Gove had been humiliatingly defeated leaving just Leadsom and Home Secretary Theresa May to contest the leadership race. As news outlets breathed a sigh of relief that the pace of emerging stories was starting to slow down and prepared themselves for a lengthy contest an article emerged in The Times in which Andrea Leadsom appeared to suggest she was a better candidate than May owing to the fact she was a mother. It had been revealed barely a fortnight before the article that May and her husband were unable to conceive children and the comments sparked outrage. Leadsom, perhaps revealing a level of naivety, protested her comments had been taken out of context. Sadly for the challenger the damage had been done and she revealed she would be withdrawing from the race a few days later. With nobody to challenge her, Theresa May was announced as the victor later that day by the 1922 committee (the board of backbenchers which acts as The Conservatives ruling body). The announcement was made on the Monday and May had moved into 10 Downing Street by Wednesday afternoon. The media’s relief was short lived as news came thick and fast. At the time of publication May has met with a number of European leaders
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and has confirmed that there are no plans by the government to invoke Article 50 until at least 2017. There is further speculation that a general election may be called before this in order for the new government to gain a new, and possibly stronger, mandate from the electorate. Judging by the current poll numbers and civil war raging with the opposition the government shouldn’t struggle to achieve it. What to do for investors then? As discussed above there are the usual avenues for turbulent times such as gold and commodities but considering the long term prospects of uncertainty there can be little doubt that whilst money may be safe it will not yield significant returns. Shares are in a similar position and it would take somebody extremely brave to throw significant amounts of capital in any specific direction. With Sterling in an extremely weak position there are many that think companies who export could well be worth a gamble, but once again this is merely speculation and solid evidence is sparse and tough to come by. As a magazine specialising in property it’s no great surprise that we would recommend investing your long term capital in to the sector but there’s method behind this. The first thing to consider is that capital appreciation is more than likely to prove profitable as house builders had an enormous amount wiped off their shares in the aftermath of the vote. This is seen as
a sign that housebuilding may grind to a standstill in the short term as the builders themselves seek to ride out the storm. This in turn, it is expected, will place pressure on housing stock and drive prices up as demand outstrips supply. Secondly and significantly it is presumed that economic depression will drive down wage growth and the labour market. With house building suppressed and demand increasing at the same time as wages going stagnant this keeps the unenviable but profitable situation of first time buyers finding it near impossible to get themselves on to the property ladder. These forces should work together to improve the outlook of landlords and property investors as people requiring rented accommodation is set to increase hugely. Demand for rental housing will keep the market stable and whilst in the short term we can perhaps expect a drop in value in the housing market every single measurement over recent history has shown that property usually increases with value over the long term. This isn’t to say that it’s a guarantee (it certainly isn’t) but whilst we traverse perhaps the most uncertain economic times for a generation certainties are only certain in that they don’t exist. With these issues in mind there can be arguably no safer place to invest than bricks and mortar. In a worst case scenario we can see a market that loses short term value but retains high demand and strong yields with long term gains. In a perfect situation we
will see a resilient market invest heavily in to property with high and stable increases in capital gains. If stocks and commodities are unstable then property certainly seems like the most stable investment at this time. Nobody can say for sure what will be coming in the coming months and years and a lot, it seems, depends on the results of the Tory leadership election and whether a general election is called. There seems to be growing voices joining a movement to stop the UK from leaving the UK and on the face it it’s tempting to say that the most likely outcome is that a pro-EU government will take office before the end of the year either through majority or coalition and with the British public realising that perhaps Brexit wasn’t quite what they expected. Either way we’re confident enough to say that an investment in property through uncertain times has proved again and again to be the ideal safe haven for investors’ money. “It’s a complicated, bureaucratic, overbearing, inspirational and consistently-irritating institution and Britain would be absolutely crazy to leave it. Especially because, if it stays, it can reap all the benefits while still being horrible about everything, and that is the British way.” John Oliver Whatever your opinions are of the European Union, if you’re an investor it will affect your decisions for the foreseeable future.
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THE EFFECTS OF COASTAL EROSION What effect is climate change having on one of the worlds greatest treasures?
Words : Alex Timperley | View : Sebastien Burel
Coastal erosion is set to be one of the defining crises of the next century. As climate change becomes increasingly severe, coastal societies around the world live in fear of rising sea levels and extreme weather. The plight of the world’s coral reefs offers us a look at the bleeding edge of the destruction caused by climate change and Australia’s Great Barrier Reef gives us the saddest case so far. What are corals? Despite their appearance, corals are neither rocks nor plants – they are in fact a variety of invertebrate marine animal. Each coral is made up of many individual coral polyps, tiny soft-bodied organisms related to jellyfish and sea anemones. The calcium carbonate secreted by these polyps as a protective layer, called a calicle, is what gives coral its hard structure; as many coral polyps gather and secrete more and more calcium carbonate, the coral grows and gains the hard skeleton which makes it look like a rock. As each individual coral grows it meets other corals and the calcium carbonate skeletons begin to fuse into one singular, larger structure. This process repeats and repeats until finally you have one of nature’s most remarkable sights: a coral reef. Coral is a sessile animal by nature, meaning that it is fixed in one place and does not move of its own accord,
and can only cover more ground by growing continuously. To do that it needs a consistent source of energy and new building material. To this end, corals have formed a very successful symbiotic relationship with photosynthetic algae called zooxanthellae which live in the corals’ tissues. The corals provide the algae with a safe environment and the compounds they need to carry out the photosynthetic processes they undergo in order to survive. In return, the algae provide oxygen to the corals and remove waste, along with supplying the corals with the by-products of photosynthesis, glucose, glycerol and amino acids, which are used to create proteins, fats and carbohydrates as well as the calcium carbonate skeleton which stands this whole symbiotic enterprise up. Aside from the intricate molecular chemistry of life enabled by the algae, the stunning colour palette associated with coral reefs is also attributable to the zooxanthellae passengers. Every brilliant hue which can be seen while snorkelling or watching the latest BBC documentary about marine life is a side effect of the algae’s natural processes. Why are coral reefs important? In total coral reefs cover only 0.1% of the ocean floor, so why is an overall pretty small group of organisms held in such high regard? Put simply, coral
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Great Barrier Reef, Australia
reefs are the bedrock of an enormous system of marine biodiversity of immense value to both the world and humankind. Coral reefs are the nurseries for roughly one quarter of all the fish in the world’s oceans. This is as big a deal as it sounds – it is estimated that one billion people across the world, more than one eighth of the total population of Earth, are dependent on coral reefs for food, income, or both. Coral reefs are believed to support an even greater biodiversity than the world’s rainforests, making them indispensable to the ecosystem. Reefs are also a key part of the culture and traditions of coastal societies across the world. Reefs protect coastlines by breaking the power of waves during storms, hurricanes, typhoons and tsunamis. More than 275 million people across the world live within 10km of a coral reef. The bulk of these live in developing countries where flood defences and related infrastructure are not at the same levels as in richer areas of the world and the weather patterns are more volatile. As well as protecting coastlines, coral reefs also contribute to protecting us from disease. Enzymes and compounds found within coral reefs have been used to treat conditions as varied as asthma, arthritis, cancer and AIDS. It has been speculated that marine life may offer us a 300 to 400
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times better chance of finding new medicine thanks to marine organisms’ greater phylogenetic diversity – that is, the greater number of inferred evolutionary links between different species which can be used for accurate comparative testing. All of this begs the question: If coral is so great, why are we intent on killing it all? Why is coral in danger? We are currently seeing the longest and probably worst coral ‘bleaching’ event in the history of the world. ‘Bleaching’ is the term for the natural phenomenon which sees corals expel their algae friends and turn white following the loss of the colour which the algae take with them. This leaves corals more susceptible to disease and, ultimately, death. This rejection occurs because warmer temperatures cause the algae to produce compounds which are toxic to the corals, thereby turning the symbiotic relationship into more of an antagonistic death grip. In this way corals respond to climate changes in a similar way to plants,
despite being marine animals. The world’s oceans absorb 93% of the heat generated by man-made climate change and the corals simply cannot adapt quickly enough to the increased temperatures. Global climate change has raised water temperatures too far already and caused extreme weather events which are set to continue in to the future and increase in severity. Coral bleaching caused by climate change may well be the final nail in the coffin for coral ecosystems across the world. A reef will take a decade to recover from bleaching, and that is assuming nothing else bad happens in that timeframe. However, it would be remiss to blame everything on man-made climate change and the bleaching which follows. We have also invented many other more prosaic ways to destroy coral reefs, which we pursue enthusiastically. Destructive fishing practices are a major cause of coral reef death. Overfishing, which upsets the ecological balance of coral reef communities and warps the food chain, has wide ranging effects on the long term health of the reef. Other questionable personal choices made by humans also act to the detriment of the reefs. Dynamite fishing and live cyanide fishing is obviously going to be bad for any living organisms caught up in the process, as is trawling the ocean floor with huge nets
which scoop up everything in their path. In South East Asia fisherman hit the coral reefs with big sticks to scare fish out of them, in a practice called muro-ami. None of these methods reflect great care on our behalf or inspire confidence that we have either the ability or the will to fix our mistakes. As well as directly destroying the reefs, humans also manage to damage and kill coral reefs through general carelessness and a lack of concern for our natural environment. The dumping of industrial waste, chemicals and oil into the sea poisons the reefs. Some pollutants such as agricultural waste and sewage increase the levels of nitrogen in the sea which cause an overgrowth of algae and cuts off sunlight to the corals. Even inland activities can severely affect coral reefs. Construction, mining, logging, farming and many other human activities create masses of sediment which get carried into the sea and smother corals. The destruction of natural defences, such as mangrove forests which trap sediment before it enters the ocean, only exacerbates the problem. Finally, and perhaps most damning of all, live coral is sometimes directly removed from the sea. Whether it is tourists looking for a holiday souvenir or others who use coral for bricks, cement or aggregate, there are many
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Great Barrier Reef, Australia
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who are either unaware of the long term effects of their actions or simply don’t care. Great Barrier Reef The Great Barrier Reef off the North Eastern coast of Queensland in Australia is the best example of how human activity is leading to a massive marine disaster. The reef is the largest continuous living structure in the world, clocking in at 2300km long and covering an area the size of Germany. It is longer than the Great Wall of China and visible from space. It has been a vital part of the lives of the Aboriginal people for 60,000 years. It is one of the seven natural wonders of the world. It is home to 1600 species of fish, 130 types of rays and sharks, over 30 species of whales and dolphins, 4000 species of mollusc and 1500 species of sponge, among many others. Today, it is estimated that about half the coral in the Great Barrier Reef is dead, probably beyond repair, and native species such as the dugong and the large green turtle are threatened with extinction. The Reef is currently a UNESCO World Heritage site but is set to be placed on the official “in danger” list in the near future as a result of the deteriorating conditions and widespread destruction of the habitat. The Australian government may have spent $400m lobbying UNESCO to keep the Great Barrier Reef off the “in danger” list in the interests of protecting tourism, but the fact remains that this dying reef is one of the most vivid and alarming victims of manmade climate change to date. On top of this, the continued expansion of the coal industry in Australia does not bode well for the future of the Great Barrier Reef. A particularly egregious example of the casual destruction visited upon the Reef is the opening of a new coal export port at Abbot Point which requires another 1.1 million cubic metres of dredging in previously undisturbed seagrass habitat. The time to act on this is now, before the damage is irreversible. On this front, there are a few rays of light shining through such as the purchase of the Cape York cattle station by the Queensland government. The cattle station was responsible for a disproportionate amount of pollution being vented onto the Great Barrier Reef before the purchase. Since the government bought it for $7m, the cattle ranch has temporarily been decreed a nature reserve and has stopped polluting the reef. The sad fact is that the only way that coastal erosion in general, and the Great Barrier Reef in particular, could be given a true shot at redemption is if we all stopped burning fossil fuels and warming the oceans. This seems unlikely, so in the meantime we must look to other methods. Seriously funding ecological initiatives such as the aforementioned purchase of polluting sites and returning them to nature is a way forward, though that would require government interventions which tend to be unpopular among politicians in the countries most able to help. We can create artificial reef-like structures which offer safer environments to marine life and, theoretically, allow them to thrive and repopulate the dying areas of the oceans. Sunken boats are a popular choice for these artificial reefs – whether the boat is on the sea floor purposefully or through bad fortune. Other materials such as cinder blocks, rocks, wood and old trees are also viable in small areas and specialist, long lasting artificial reefs made of materials such as limestone, steel and concrete are not unknown. Simply not dumping all of our waste into the sea is another method which we should be urgently pursuing. There is evidence that corals are hardy enough to grow back of their own accord if they are simply left alone and not coated in pollutants and sediment. Whether this is compatible with the many commercial and tourist concerns which involve the oceans is another question, but it is a method which we know has had success in the past and will in the future. The Great Barrier Reef is one of our most precious natural treasures and we are in serious danger of destroying it. At the present rate, this great coral reef will be dead and gone within our lifetime, and all the benefits it provides will go along with it. Urgent action is needed, but will it be taken?
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Great Barrier Reef, Australia
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Architecture Planning Structures Urban Design
BRINGING PEOPLE TOGETHER The importance of trade routes through out history
Words : Alex Timperley | View : Rudra Narayan Mitra
Trade routes serve as the paths down which people, goods, armies, ideas and inventions travel. They connect the distant corners of the world and are the arteries of our history along which the shared story of humanity has flowed for millennia. By the end of the 1st Century AD it was possible to travel from Britain to the Far East along well defined and mostly secure routes. In recent years, maritime routes such as the Panama Canal have reshaped the trading patterns of the world and helped enable the globalised economy we live in. Here we look at three trade routes from history and the present day which have shaped the modern world... Silk Routes “I believe it was God’s will that we should come back, so that men might know the things that are in the world, since, as we have said in the first chapter of this book, no other man, Christian or Saracen, Mongol or pagan, has explored so much of the world as Messer Marco, son of Messer Niccolo Polo, great and noble citizen of the city of Venice.” The Travels of Marco Polo, Marco Polo, c. 1300 For over 1500 years the Silk Routes which connected Chang’an in China to the Mediterranean Sea supplied the known world with silk, spices, knowledge, new philosophies and religious ideas, science, language
and, supposedly, the Black Death. Via the Silk Routes, the Western world became familiar with the place they knew as ‘Seres’ – The land where silk comes from. Popular imagination summons up images of one long road linking two worlds together, but in reality the Silk Routes covered land and sea and took in ancient roads built by dead empires such as the Persian Royal Road and Alexander the Great’s pathways through Asia. Successful trading of the Dayuan, the Chinese name for large and powerful Western horses, led Emperor Wu to speculate on what else might be gained by trading with the strange lands to the West. He opened the Silk Routes in 130 BC and Chinese silk would eventually reach as far as Britain along with other previously unknown materials such as paper and gunpowder. Some Romans were infatuated with silk, treating it with reverence and showing a willingness to pay whatever premium was necessary. Other Romans considered the wearing of silk to be immoral and a vulgar display of vanity and pride. Despite this conflict, the hunger for silk would pass on to the Byzantines who would continue to buy in huge quantities until the rise of Emperor Justinian in 527 CE. The new Emperor was sick and tired of paying Chinese premiums on silk and looked to start making it himself. Much wondering about the nature of
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Silk Routes, China
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Jimrud Fort on the Khyber Pass (Grand Trunk Road), Afghanistan
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silk followed. Did it grow on trees? Did it simply appear out of the ground in China? Eventually the Emperor sent an expedition to China to find the secret. This turned out to be silkworms and a 5000 year old history of careful cultivation, both of which were hastily stolen. Following this theft, silkworms began to be cultivated in Europe for the very first time. The Silk Routes would be closed in 1453 CE after the Byzantine Empire fell to the Turks and the Ottoman Empire proceeded to cut all ties with the heathen West. When they were open, the Silk Routes were vital to the growth and future prosperity of civilisations at either end, and, with the benefit of hindsight, their closure is one of the great historical what ifs. How would the world look now if there had been a further 500 years of collaboration? Empty spaces on Chinese and European maps were filled due to the Silk Routes and the world became smaller as the years passed. The accounts of famous travellers such as Marco Polo fired the imagination of Europeans and helped ignite the fires of exploration which would lead to European Empires taking over most of the world. Christopher Columbus kept a heavily annotated copy of Marco Polo’s travel journal in his belongings and that grand trip across the world by land would eventually inspire Columbus’ own attempt to discover a westward route to the Far East by sea. That journey would lead to the discovery and colonisation of the Americas by the Europeans, one of the most fundamentally significant events in human history which defined the modern world. Grand Trunk Road “And truly, the Grand Trunk Road is a wonderful spectacle. It runs straight, bearing without crowding India’s traffic for fifteen hundred miles – such a river of life as nowhere else exists in the world. They looked at the green-arched, shade-flecked length of it, the white breadth sparkled with slow-pacing folk...” Kim, Rudyard Kipling, 1901 The Grand Trunk Road has connected East Asia with Central Asia for over two thousand years, from Kabul in Afghanistan to Chittagong in Bangladesh. The Road has its origins in the Maurya Empire in the 3rd Century BC and the original architect was the Afghan king Sher Shah Suri who aimed to facilitate trade between his home town, Sasaram in Bihar, to his capital, Agra. Both the Maurya Empire and the name of Sher Shah Suri have long since been left behind, but the original purpose of the Road has lasted through the millennia. Shah Suri intended the road to be as comfortable as possible for merchants and travellers, planting trees along the entire route for shade and building inns and digging wells at regular intervals along the way. These have also proven a great help to the many armies which have passed along this road and given it an alternate name – the General’s Road. The Khyber Pass in particular has been a highway for the ambitions of warlords and conquerors over the years. Hinduism, Sikhism, Jainism and Buddhism all developed in the environs of the Great Trunk Road and the faithful used its pathways to spread their philosophies far and wide. Coming the opposite way were Muslim proselytisers, preaching and teaching about Muhammed and his followers. As might be expected under the circumstances, the Great Trunk Road has seen much religious violence over the years. A recent example of this was seen in 1984 when Sikh separatists seized the Golden Temple and the Indian Government killed 2,000 people in reply as Operation Blue Star dug the Sikhs back out. The Indian Prime Minister who instigated the killings, Indira Gandhi, was assassinated a few months later in response by her Sikh bodyguards. Today the Golden Temple is peacefully in Sikh hands, but the lessons of the 1980s have not been forgotten and armed Sikh guards patrol and defend the Temple in case violence flares up once again. The Grand Trunk Road is still a key part of India’s transport network, though the quality of the road varies greatly depending on where you are. The section between Delhi and Kolkata is known as National Highway 2 and is a pristine example of modern infrastructure. The section known as the Jalalabad-Kabul Road which cuts through the mountains of Afghanistan is long, winding and treacherous, one of the most dangerous stretches of road in the world. One thing that remains constant along the length of the Road is the sheer
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number of people who use it daily and rely on this ancient road for their prosperity and lifestyle. Since Partition in 1947, the 300 miles between Peshawar and Lahore has been controlled by Pakistan, but six Indian States control the other 1250 miles. Along its length the Grand Trunk Road shows travellers the past and the present, going from the mundane to the momentous in the blink of an eye. Shrines and temples from different religious cultures mix in with traces of the British Raj and modern Indian society. It shows how ancient empires gave way to each other, how the Road became the main artery of conquest and rule under the British Raj, and how British rule itself was altered and eventually subsumed by India and Pakistan. Kipling’s “river of life” continues to flow and the Road acts as India’s lifeline. Panama Canal “At one point an elderly resident Frenchman told him that if he persisted with his plan there would not be trees enough on the Isthmus to make the crosses to put over the graves of his laborers.” The Path Between the Seas: The Creation of the Panama Canal, 1870-1914, David McCullough, 1977 Between 1903 and 1914 President Theodore Roosevelt oversaw the construction of a long held American dream. The trans-isthmian canal which cut through Panama would go on to revolutionise worldwide trade and help launch the United States of America as a modern economic superpower. Throughout the 1800s, if a merchant wanted to ship goods from the Atlantic coast of the United States to the Pacific coast they could choose from two equally bad options. The first was to drag their goods across the entire landmass of continental North America which was obviously not ideal for anyone involved. The second option was to circumnavigate the whole of South America via Cape Horn which was very dangerous and incredibly expensive, both in terms of the time it took and the money it cost. The French attempted to build a canal in the 1880s but the company in charge soon went bankrupt as the scale of the task became clear. Malaria, yellow fever and other tropical diseases killed 20,000 labourers during the nine years of excavation and construction. The people in charge were, quite rightly, prosecuted by the French government. The US Senate voted overwhelmingly to pick up the baton in 1902 and dig a canal through Colombian-controlled Panama. Colombia rejected the proposed American treaty, an act of national self-determination which the USA decided to repudiate by sending warships to support Panamanian independence claims. By 1903 Panama was an independent state and the new government rewarded their American benefactors with a 10 mile wide strip of land for their canal at a cut price – a one off payment of $10m and $250,000 a year thereafter. This was not the prettiest piece of international relations ever undertaken by the USA but it was certainly effective. 10 years and millions of tons of earth later the USA and Panama successfully completed their canal, a 48 mile long waterway which lifted ships 26 metres above sea level at its highest point and joined the Atlantic and Pacific oceans. By the early 21st Century the Panama Canal accounted for 5% of the world’s shipping trade, including 70% of all cargo going to and from the USA, representing almost one million ships a year from the original starting point of 1000 ships in 1914. It has been predicted that 510m tons of cargo will pass through the Canal annually by 2025. This rising demand combined with the rise of Post-Panamax ships, vessels which are too big to fit though the Canal, spurred the Panamanian government into launching a $5.25bn expansion of the Canal in 2007. The new lane fit for the Post-Panamax vessels opened in June 2016 after years of construction and is already changing trade patterns around the world, ensuring that the Canal will remain one of the world’s key trade routes. Above even that, the Canal is by any measure a wonder of human ingenuity and the sort of complex feat of macro-engineering which never a fails to inspire a sense of wonder and awe.
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Panama Canal In construction, Panama
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LAB GROWN MEAT In-vitro meat: A fad, or the future…?
Words : Hannah Wilde | View : Alex Traksel
In this day and age, science and technology are advancing faster than humans can even comprehend. Computers have grown smarter than we ever thought possible throughout the 21st century, the aviation industry has been completely revolutionised, and there’s even talks we could have driverless cars as soon as the end of the decade. The technological landscape has certainly benefitted from advancements in the past decade across almost all sectors, but now there’s a new scientific advancement on the horizon that has the potential to affect one of our most primitive human needs: eating. Stemming all the way back to our caveman ancestors, humankind has always craved and abundantly feasted on animals as the ultimate form of nourishment and sustenance. But what if modern science now allows you to eat something that looks, feels, smells and tastes like meat, but isn’t meat in the traditional way we have always known it? I know what you’re thinking: is this even possible? Well thanks to incredible scientific and medicinal advances, this theory is more than possible—it’s already a reality. Using techniques used in stem cell research for developing cures for human illnesses, scientists since the turn of the century have been harnessing the idea of extracting and growing animal stem cells for human consumption but without the need for animal mortalities. The stage is now set for cultured meat (or to use its other names, in-vitro or synthetic meat), which is the creation of meat in a
laboratory using animals’ stem cells rather than produced from animal carcasses in an abattoir. A world where we can have all the gastronomical delights of meat without the ethical repercussions is certainly an intriguing one, but one that is by no means black and white. What started out in my mind as simply (“Meat without animal cruelty: what’s not to love?”) could prove to be far more complicated than first anticipated. Here, Global Property Scene looks into the complex world of scientific meat production, posing the question: is the future of food really a hyper-modern reality where veal is made in a vial, where pork is grown in a petri dish, and where bacon is made in a beaker? How does in-vitro meat work? The idea of artificial meat, although only just coming to the forefront of consumer consciousness, has been around for years. As far back as 1932, former British Prime Minister Winston Churchill predicted that in the next 50 years, “we shall escape the absurdity of growing a whole chicken in order to eat the breast or the wing by growing these parts separately under a suitable medium”. He may have been over three decades out, but Mr Churchill’s prophecy is indeed coming to pass.
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In what Time Magazine declared as one of the top 50 breakthrough ideas of 2009, the production and development of in-vitro meat, sometimes called cellular agriculture, involves the extraction of cow muscle tissues (“master” stem cells that can replicate themselves) which, after an incubation period of around 3 weeks with the inclusion of nutrients and growth stimulants, multiply and coalesce into small centimetre-long strips of muscle. The cells after the nurturing process then take on the consistency of meat, and can be sculpted into the shape of choice, whether sausages, patties or potentially even steaks. Additional extras are then added in to heighten flavour like seasonings and herbs, and the final ingredient to enhance aesthetics: a natural compound myoglobin, which colours the cells from their natural white to a more familiar red. The cells are now ready to be cooked, in much the same way as cooking traditional meats. Naturally, the next big question is: ‘How does in-vitro meat taste?’ Only a handful of people have had first-hand experience testing this culinary revolution, but the testimonies from those who tasted the world’s first synthetic burger at a London press conference in August 2013 were inherently positive. Hanni Rützler, celebrated Austrian nutritional scientist-cum-food researcher, positively glowed about the burger, saying: “I didn’t know how juicy it would be, but there is some quite intense flavour. It’s close to meat…the consistency is perfect. This is meat to me”. Do we really need alternative meat? Many carnivores attest that we don’t need alternative meat sources when we have a near-constant stream of livestock at our disposal, with their most vociferous argument being: ‘Why mess with something that has been working for thousands of years?’ Of course this is understandable, but you have to look at the bigger picture of what meat production actually means, not just from an ethical standpoint but also nutritionally and—even more pressingly—environmentally. Rather than created for the whimsy and guilt-free enjoyment of avid herbivores, it seems that in-vitro meat could one day play a much larger part in society than simply to appease non-meat-eaters. The environmental effects of rearing, nurturing, transporting and eventually killing animals on a huge scale really cannot be overestimated. It’s said that every year an average cow emits 100kg of methane (a greenhouse gas 23 times more pollutant than carbon dioxide)—ultimately just one cow has the same environmental effect as TWO return flights between London and New York. This isn’t the worst of it. 30% of the Earth’s usable surface is used to house animals. Animals account for 5% of the world’s carbon dioxide emissions and 40% of methane emissions. The list goes on, but a damning statistic that really sums up the dangers of meat production comes from journalism professor at UC Berkeley Michael Pollan: “A vegan in a Hummer has a lighter carbon footprint than a beef eater in a Prius.” These shocking stats prove that, although rearing animals for food is massively damaging our environment every single year, humans still continue their reckless consumption of something they just accept as a ‘natural’ and unavoidable part of life. Pleas from a number of accredited scientists, like Dr Rajendra Parchauri’s impassioned appeals for everyone to have at least one or two meat-free days per week, have fallen on deaf ears. Pop-culture fads designed to kick-start the population’s meat detox like “Meat-Free Monday” and “Veganuary” were introduced to show people the possibilities of following a diet not dependent on meat, to little or no avail. Despite our best efforts, demand across the world has continued to soar. Research shows that the average Briton eats around 85kg per year, the equivalent of 33 chickens, 1 pig, three-quarters of a sheep, and one-fifth of a cow. Our collective consumption is even worse—In Britain alone, 5.1m tonnes of meat is consumed each and every year, equivalent to 23.8 million cows. And, demand is still growing. If current predictions are correct, global meat consumption is likely to double by 2050. However, it’s unthinkable and almost supercilious to ask the entire population to forego meat. If you’ll excuse the pun, it would be nigh-on impossible for everyone in the world to go cold turkey in the quest for a meatless existence. Therefore, in order to make the environment significantly more eco-friendly for future generations, we need another option—something sustainable, something environmentally-friendly and, even more crucially, something that’s enough of a meat substitute that people will be happy to sacrifice conventionally-farmed meat for. And, as history dictates, soy products like Quorn just won’t fit the bill.
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Lab grown meat
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Traditional meat production
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Meat cultured from stem cells
This is where in-vitro meat looks a whole lot more appetising. It ticks almost every box—it’s sustainable, it is (in a roundabout way) generated from animals, it eradicates the need for animal slaughter and, as the 2013 prototype shows, it has the potential to look, feel and taste like normal meat. What’s more, the possibilities for in-vitro meat are endless: since the stem cells are engineered in a laboratory, almost any element can be adapted, removing bad fats, enhancing good fats and even reducing cholesterol in the end product. This means that, contrary to people’s primary belief that meat created in a lab is ‘unnatural’ and ‘unhealthy’, synthetic meat could actually be healthier than its current counterpart. Furthermore, if everybody embraced artificial meat we wouldn’t need to curb our meat cravings either—in ideal conditions, just two months of in-vitro meat production has the potential to deliver up to 50,000 tonnes of meat, all from just 10 pork muscle cells. And even better: this alternative method of meat production could reduce greenhouse gas emissions by as much as 96%. Oxford University professor of practical ethics Julian Savilescue couldn’t be any more proud of the work done so far in developing in-vitro meat, positively gushing about its attributes. “Artificial meat stops cruelty to
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animals, is better for the environment, could be safer and more efficient, and even healthier. We have a moral obligation to support this kind of research—it gets the ethical two thumbs up, [and has the potential to be] really transformative for the world”. The question of whether this will be enough to make every day a “Meat-Free Monday” remains to be seen, but it is certainly everyone’s prerogative to protect our world—and if that includes finding a way to satisfy the growing appetite for meat by embracing artificial meat, then the wheels are already turning. The limitations of in-vitro meat As great as in-vitro meat sounds on paper, is by no means infallible: there are some kinks that certainly need ironing out before artificial meat is rolled out on a mass scale. Up until now, synthetic meat can be seen as ‘semi-ethical’—by this I mean the scientists can extract the stem cells from the animals without hurting them, rendering slaughter an unnecessary thing of the past. However, these extracted cells require a growth agent to encourage them to prosper outside their natural
environment and, as of this moment, the growth agent of choice is foetal calf serum, the blood plasma of an unborn cow. In a paradox that could be seen by some as only the work of irony, while a fully-grown living cow is saved by the creation of in-vitro meat (less a few unrequired stem cells), an unborn cow is denied the opportunity of life to feed the growth of these cells. Although this meat alternative has so far received the unanimous praise of even the staunchest animal activists the world over, in-vitro meat certainly cannot call itself ethical until a solution is found. Naturally, finding a solution to this paradox is high on developers’ to-do lists, with alternative growth substances already including algae and other such nutrients. Another potentially huge barrier to overcome for the in-vitro pioneers is the crippling cost of producing meat in a laboratory—hundreds of millions of pounds has so far been invested into the research and development of alternative meat. The world’s first ever synthetic hamburger was created in 2013 by leading in-vitro agriculturist Professor Mark Post at the University of Maastricht for the cost of a brand new Lamborghini Aventador supercar (£250,000), and was funded by Google co-founder
Sergey Brin. However, researchers have assured potential consumers that prices will go down if commercialised on a mass scale (which creator Mark Post predicts could be as early as 4-5 years), with recent predictions valuing artificial beef burgers at a much more moderate $11 (£8.50). If scientists can one day make in-vitro meat financially viable for the masses this will, if not make traditional meat redundant, then at least make people stop and think about other options. As The Guardian newspaper succinctly surmises: “As traditionally-farmed meat gets more expensive, it’s only a matter of time before the public begins to embrace alternatives”. What’s next for in-vitro meat production no-one really knows, but what we do know is in a world where we already have artificial intelligence, why not have artificial foods too? Now the foundations have been well and truly laid by ground-breaking scientific discoveries, we’ll just have to wait and see how big a part in-vitro meat will play a part in this new, scientifically-advanced future. Far from being light years away, the future is now…
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WORLD MARKET VIEW The global financial crisis plunged property markets into a downward spiral. Eight years on, Global Property Scene takes a look at how the international markets are developing.
London, UK • Median sales price: $1,224,121* • Average price per sqft: $1,311
Note - Figures correct as of stated dates: *July 2016
Los Angeles, USA • Median sales price: $612,002* • Average price per sqft: $917
Mexico City, Mexico
New York, USA
• Median sales price: $82,020* • Average price per sqft: $616
• Median sales price: $1,314,533* • Average price per sqft: $1,669
Most expensive cities to live and work: (Correct as of July 2016) 140,000
Prices are the combined cost of residential and office accommodation per employee in 2016.
130,000 120,000 110,000 100,000
Sao Paulo, Brazil
90,000
• Median sales price: $217,150* • Average price per sqft: $212
80,000 70,000 60,000 50,000 40,000 30,000
Cape Town, South Africa
20,000
• Median sales price: $76,210* • Average price per sqft: $227
10,000
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Paris
Hong Kong
San Francisco
Tokyo
Singapore
Lagos
New York
London
0
Singapore Moscow, Russia • Median sales price: $394,450* • Average price per sqft: $850
Dubai, UAE • Median sales price: $299,877* • Average price per sqft: $583
• Median sales price: $1,194,148* • Average price per sqft: $1,983
Sydney, Australia • Median sales price: $626,121* • Average price per sqft: $979
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WHAT’S THE ALTERNATIVE? Jaguar XKSS
Words : Michael Smith | View : Jaguar Land Rover Classic
We would all like to own a special piece of history, something that captures the feeling of a particular period in time. For instance, I live in a house predating my own inception by as much as 70 years. This house has seen many generations of different families reach major milestones. That first step, first day of school, the moment the first child flies the nest. All of this history shows through in the style and feel of this family hub. As we take ownership of this property it’s our duty to stamp our mark, whilst not removing the history. Sadly, the same can’t be said about the car out front. As the needs of my life require something that can move me around in comfort and reliability, I have to settle with something modern. As much as I like this car, it isn’t something I feel that same connection with. When the time comes to replace this current model I suspect its exit will be met with nothing more than a hand shake, a signature and a cold shoulder as I embark in the latest acquisition. The question is what if you could have a classic, yet modern car? What if I could find something that offers historical pedigree, classic style and that all important new car smell. A car fresh off the forecourt with a 12-month warranty, the original tires and not a hint of patina.
Jaguar, a company synonymous with historical style, performance and racing success seem, to have answered this difficult brief. Ladies and gentlemen, I give you: the 1955 Jaguar XKSS. Now I know what you’re thinking, that is in no way a new car, far from it. Well, let me tell you a bit of history that should satisfy any doubts. It all begins in 1954, with the introduction of the D-Type race car. This was Jaguar’s entry into the Le Mans 24-hour race, and was a model based on the design and engine architecture of the C-Type. Although it shares many of its mechanical components with the C-Type, including the basic straight-6 XK engine design (initially 3.4 litres and uprated to 3.8 litres in the late fifties), the structure of the car was radically different. The innovative monocoque construction brought aviation industry technology to competition car design, together with an aeronautical understanding of aerodynamic efficiency. It was this revolutionary design that gave the D-type its distinctive tailfin, located just behind the driver’s seat. The D-Type had a difficult start to its racing career: it’s first entry into the Le Mans 24-hour was hampered by problems with the fuel systems. As a result, it had to stop regularly, causing it to drop a whole lap behind the then very competitive
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Magna Carta
Ferrari 375 Plus. There was at least strong evidence to support the design, as the aerodynamic design allowed the D-Type to reach speeds of up to 172mph, a full 12mph faster than its nearest competitor. The following year the D-Type returned to Le Mans 24-hour race, boasting modifications including long-nose bodywork and an uprated engine containing larger valves. The car proved very competitive but the overall result was tarnished. Towards the end of Lap 35, Mike Hawthorn’s D-Type had a narrow lead over the Mercedes 300 SLR of Juan Manuel Fangio. And then, disaster struck. To reach his pit-stop, Mike Hawthorn had to cut in front of Lance Macklin (driving a much slower Austin Healey 100S), causing Macklin to swerve into the path of Pierre Levegh in his much faster Mercedes. Pierre Levegh’s 300 SLR hit Macklin’s Austin-Healey 100S from behind, his car became airborne, soaring towards the left side of the track into a packed grandstand. The power of the impact resulted in the front end of the Mercedes completely disintegrating across the crowd. The vehicle then began to spin high into the air, throwing even more debris into the tightly packed grandstand. The parts thrown into the crowd included the engine, front axle and bonnet, having broken free of the car’s frame. Off the back of this force, the Mercedes bonnet began to spin towards the
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crowd. Spectators were left stranded as the spinning bonnet decapitated dozens like a guillotine. On top of which the hot, heavy engine followed crushing or disfiguring spectators as they tried to duck below fellow spectators. With a large portion of the crowd opting to climb up on the extremities of the grandstand, they had inadvertently placed themselves in a direct path of the lethal debris. Straight after the initial impact, Levegh had been thrown clear of the tumbling car, avoiding the chaos of debris. Unfortunately, due to the force of the impact, he suffered a fatal head injury as he reached the ground. When the remaining pieces of the car landed on the embankment, the rear-mounted fuel tank exploded. The ensuing fuel fire raised the temperature of the remaining Elektron bodywork past its ignition point, which was lower than other metal alloys due to its high magnesium content. The alloy burst into white-hot flames, showering the track and crowd in magnesium embers. Rescue workers, totally unfamiliar with magnesium fires, poured water on the inferno, greatly intensifying the fire. As a result, the car burned for several hours. Driver Pierre Levegh and more than 80 spectators lost their lives, while many more were injured. To this day it remains the most catastrophic accident in motorsport history.
Subsequently Mercedes withdrew from the race, and with Jaguar opting to continue, the D-Type driven by Hawthorn and Ivor Bueb went on to win. Jaguar continued to have great success with the D-Type, winning five of the top six places in the 1957 Le Mans race. Sadly, the reign of the D-Type had to come to an end. There were significant rule changes in 1958, restricting engine sizes to a maximum of 3 litres. This rendered the 3.8 litres XK engine illegal. Jaguar couldn’t get the performance out of a new three-litre version, and subsequently decided to draw a line under competing as a factory. Following the decision to retire temporarily as a factory team, the company had the dilemma of what to do with the remaining D-Types. They had already invested a lot into the project and it was clear they needed to recoup this investment. The decision was made to reimagine these models as road-going sports cars. With high demand in the American racing market, these models would have the necessary modifications to make them eligible to compete. As listed by Jaguar the modifications included minor changes to the basic D-type structure: the addition of a passenger side door; the removal of the large fin behind the driver; and the removal of the divider between passenger and driver seats. In addition, changes were made for cosmetic, comfort and legal
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Engine: 3.4-litre Power: 250bhp Weight: 921kg
XKSS, Jaguar
reasons: a full-width, chrome-surrounded windscreen was added; side screens were added to both driver and passenger doors; a rudimentary, folding, fabric roof was added for weather protection; chromed bumpers were added front and rear (a styling cue later used on the E-type); XK140 rear light clusters were mounted higher on the wings; and thin chrome strips were added to the edges of the front light fairings. These models proved very popular and with conversion progressing it looked like all the remaining twenty-five examples would find new homes. Then on the evening of 12 February 1957, a large fire broke out at the Browns Lane plant. Tragically nine of the remaining twenty-five cars were destroyed in the fire. Fast forward to 2016 and it looks as though the production run will be completed. Jaguar has announced that it will build nine new examples of its famed XKSS sports car produced in 1957, each costing in excess of £1 million. These nine models will carry the same numbers allocated to the models lost in the fire. This project will offer nine lucky buyers the opportunity to own something both brand new and designed over 50
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years ago. As these are new cars it allows their £1.1 million or thereabouts owners to specify items used on the original, such as a luggage rack on the boot and a tonneau cover. Beneath the beautiful exterior will sit the same 3.4-litre, straight six engine capable of producing 250bhp. Each of the models will be hand-built to the exact specifications of the original cars at Jaguar Classic’s new Experimental Shop in Warwick. To ensure that every model meets the original standards, all aspects of the production will be fully certified by Jaguar. Tim Hannig, Director of Jaguar Land Rover Classic, said: “The XKSS occupies a unique place in Jaguar’s history and is a car coveted by collectors the world over for its exclusivity and unmistakable design. “Jaguar Classic’s highly skilled team of engineers and technicians will draw on decades of knowledge to ensure each of the nine cars is completely authentic and crafted to the highest quality. “Our continuation of the XKSS reaffirms our commitment to nurture the passion and enthusiasm for Jaguar’s illustrious past by offering exceptional cars, services, parts and experiences.”
XKSS, Jaguar
When you sit down and take a look at the figures behind these cars, they do truly look like a great investment opportunity. The original cars, which boast previous owners such as Steve McQueen are few and far between. With so few ever produced they rarely become available to buy and as such the prices are stratospheric. With conservative estimates placing these models around 10m GBP, their coveted reputation in the collector market means you’re unlikely to ever see one appear at auction. So with the original models boasting a price tag north of 10m GBP, it’s clear these new XKSS models could be a real bargain. With first deliveries expected to land early 2017, customers won’t have to wait too long to get their hands on these truly unique pieces of automotive history. All of which brings me back to the original question. It would seem you really can have both. Admittedly you would need a significant amount of money to stake a claim on one of these models, but from an investment point of view it makes real sense. With the classic market only going up, and the demand for cars with racing pedigree at the front of most automotive investors minds, I think the XKSS offers all the benefits of classic car ownership with none of the drawbacks.
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Q&A The uncertainty caused by the UK referendum has filtered through to businesses and investors throughout the world. Will companies now move their operations to countries in the EU? Will the value of UK commodities drop alongside a fluctuating Stirling? All of these questions and more are at the forefront of the minds of people looking to invest in the UK. Here at Global Property Scene we have been flooded with questions, so we thought we would dedicate this edition’s entire Q&A section to Brexit and what it means for those interested in investing in the UK property market.
Q. Has Brexit caused a lack of confidence in UK investments? Is Britain still perceived as the place to invest?
A. Uncertainty. If there was ever a word to sum up the cause of erratic behaviour amongst investors it’s this. As a species, we don’t like change. Change isn’t what we know and not knowing what tomorrow will bring is a cause of great unease and makes people hesitant and cautious. Again, two more words that are not conducive to a healthy investment market. Whilst the ‘leave’ vote came a shock to 48.4% of the country, indeed to the entire world, the aftermath of the result was in a way, not a shock, or it shouldn’t have been to the countless politicians and MPs that worked tirelessly on either side because, as they all agreed on throughout the debates (amongst the bickering and scare-mongering), no one actually knew what would happen in a post-Brexit Britain. Since the founding of the European Union in 1993, there hasn’t been a single instance when a member country has left. Pro-Brexit campaigners hailed the likes of Norway and Switzerland as models to aspire to; having access to the Common Market yet retaining their independence from the EU. Whilst the economies of these countries are certainly solid, the reality of extracting the UK from 23 years of EU policy and the negotiation of new trade agreements with the EU is nothing that can be likened to either of their positions.
Many of our readers have asked how this will affect the UK as destination for foreign investment. As the fifth largest national economy in the world measured by Gross Domestic Product (GDP) and the ninth largest in the world measured by Purchasing Power Parity (PPP), the UK continues to be a strong player in international markets. Even the recent credit rating downgrades by Moody’s and Standard & Poor’s were considered unsurprising by the business community, and are likely to have a lesser effect on the UK than on a country with a weaker economy. One of the major benefits to the Brexit result has been that, in real terms, foreign investors are likely to get a better deal, particularly when investing in property, due to the falling value of the British pound. The value of Sterling dropped dramatically on the morning of the Brexit result, at one point falling to its lowest value against the dollar in 31 years. Even though it has now started to climb, exchange rates are still low, meaning buyers in other currencies are seeing more value for their money. As we move forward, positive signs from across the board are making the headlines. The International Monetary Fund (IMF) has publically admitted that it was wrong to be so negative in its predictions; a new Prime Minister has been announced bringing stability to the Conservative Government and the Bank of England reported recently that the economy has not slowed since the Brexit vote. To quote a popular phrase, the engine might have stalled, but the wheels have kept on turning and the UK continues to be a popular destination for investment.
*These questions and answers are provided for general information only and may not be completely accurate in every circumstance.
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BREXIT SPECIAL Words : Samantha Jones
Q.
Q.
I’m worried about investing now as house prices might go down; will the value of my property decrease?
There has been a lot of talk about immigration. If fewer people enter the country, then will there be enough rental demand to keep my property tenanted?
A. The UK housing market has been accelerating at a rapid pace for some time now, almost too quickly according to some, leading to average prices topping the £200,000 mark for the first time in April 2016, and the average price in London hitting the unprecedented £455,984 mark. Whilst it was inevitable that the housing market would slow down surrounding the Brexit vote, as did many industries and sectors in the UK, reports post-Brexit from the Royal Institute of Chartered Surveyors (RICS) show a ‘softening’ of house prices, not a decrease. Price growth is continuing to grow, but at a much slower pace than it was. Just recently, the Centre for Economics and Business (Cebr) reported that house prices are still expected to be around £40,000 more in five years’ time. In many ways, this slowing of house prices may not be a bad thing. With the majority of first-time buyers finding it increasingly difficult to save money for a deposit, this may give them the breathing room required to build up their savings. For anyone feeling cautious about investing, it’s comforting to know that buy-to-let investments in the UK have outperformed all other major asset classes for decades. Property is a tangible investment that has held its value, more or less, for the last 30 years, as it is not impacted by the fluctuations of the stock markets, like bonds and gold.
A. Rightly or wrongly, immigration was a major topic in the referendum and the question on people’s minds now is, will the UK’s immigration controls change and if so, will that have an effect on the number of people entering the country? The fact of the matter is that Britain has suffered from a shortage of housing stock since the global recession in 2008. The construction industry was one of the worst hit when the economy collapsed; leading to a shortage of affordable housing that is still evident today. Latest government figures state that the country needs 200,000 houses to be built every year in order to keep up with demand. Whilst the number of construction starts in the 12 months to December 2015 was actually up 6% at 143,560 according to the Department for Communities and Local Government (DCLG); this is still a shortfall of 56,440 against the required target. In essence, regardless of whether the UK’s immigration policy changes due to Brexit, the amount of available housing stock in the UK will continue to lag behind the number of people requiring rental accommodation, meaning continuing rental demand across the country.
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SHOULD I MOVE TO BARCELONA? Words : Alex Timperley | View : Albert Nowicki
In the North East of Spain lies beautiful Catalonia, an autonomous region by the Mediterranean Sea. A rich history, unbeatable food and drink and a sensational Mediterranean climate make this mountainous region beloved of its people and a big draw for tourists from around the world. Under General Francisco Franco’s dictatorship, the Catalan language was suppressed, the region’s autonomy was revoked and the people were subjected to long term immiseration. As a result of decades of oppression, Catalan history and culture runs bone deep in the people and their history of radicalism and resistance to the Spanish government animates demands for true independence for Catalonia. As well as the fight for independence, the rejection of the rest of Spain can be seen in local laws such as the ban on bullfighting and the adoption of the Catalan Donkey as an alternative regional symbol. At the centre of Catalonia is Barcelona, the seat of local government and the city which best exemplifies everything about the region. With a population of 1.6 million, Barcelona is by far the biggest city in the region and the second largest urban centre in Spain.
Modern Barcelona is a distinctive city crammed into a small space and owes its form to Ildefons Cerdà, an 18th Century city planner. By the 1850s the people of Barcelona were suffocating, in some cases literally, due to lack of space. The old boundaries of the city walls were simply not fit for a modern city and population growth led to public health risks, such as severe cholera outbreaks, and widespread unhappiness. “Down with the walls!” went the cry from the provincial council, demanding the city be redesigned for the benefit of its inhabitants. Cerdà studied what people needed to live healthy, happy lives and rebuilt Barcelona based on his findings. The new blocks of the Eixample district took into account the amount of air needed per person, the fact that wider streets led to fewer deaths and included a garden in the centre of each block. The city was laid out thoughtfully to include schools, hospitals and marketplaces in the most convenient places and the housing blocks were chamfered in anticipation of cars using the roads in the future and drivers needing to see round corners, giving Barcelona’s blocks their distinctive octagonal shape. When he was finished, Barcelona was many times larger than it had been
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Church of the Sacred Heart of Jesus, Barcelona
before the redesign and the old city was connected to seven previously peripheral villages such as Barceloneta and Gracia, which today make up their own districts with individual character, customs, traditions and oddities. Today the city continues to strive for the ideals laid down by Cerdà and the latest plan to reform the city involves creating “superblocks”, three-by-three blocks of housing where cars are not allowed. These new blocks will be complemented by 300km of new cycling lanes. Altogether this redesign of the city aims to give the streets of Barcelona back to the residents and reduce avoidable deaths from pollution and road accidents. This forward thinking attitude and desire to help themselves is typical of the city and the people who live there. Barcelona is already a city where walking and cycling are welcomed and these latest changes will only improve the city in that regard. Wide boulevards dotted with benches and trees run the length of the city, the most renowned of which, the five streets which make up Las Ramblas, have a reputation as a home for the weird and wonderful of Barcelona. As far as cities go, it is hard to beat Barcelona as a place for strolling and
the Plaça de Catalunya, the massive public square sat at the top of Las Ramblas, could have been made for people watching. Lying in between the flashy main streets is a dense network of tightly knit alleyways and passageways which hide bars, tapas restaurants, ice cream parlours, shops and public squares which are easily missed but should not be ignored. It is here, cutting between towering flats away from the main tourist areas, where a more real experience of day-to-day Barcelona life can be found. It is possible to enter this warren of streets by the sea and wind your way all the way through to the hills on the opposite side of Barcelona without ever having to make use of a main road. The sharp lines of gothic architecture mixed in with modernist flair give Barcelona a unique aesthetic. Antoni Gaudí is the most famous proponent of Catalan Modernism and his work combining the past and tradition with natural influences has done much to define Barcelona. Gaudí’s most famous works include the public space of Park Güell and the Casa Batlló, a remodelled house known locally as Casa dels Ossos, the House of Bones, for its organic, skeletal qualities.
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La Sagrada Familia, Barcelona
However, lording over them all is the magnificent Sagrada Familia, Gaudí’s still-unfinished Roman Catholic basilica in the centre of the city. The church is designed around 18 spires, representing the Apostles, the Virgin Mary, the Evangelists and Jesus Christ, in ascending order of height. The three grand facades represent the Nativity, the Passion and the Glory, and contain many smaller scenes such as the Crucifixion, Hell, Purgatory and other elements such as the Seven Deadly Sins and the Seven Heavenly Virtues. Gaudí died in 1926 when only a quarter of the construction was complete. Following some interruptions such as the Spanish Civil War and World War Two, at the current rate the final bricks and tiles will be laid in 2026, a whole century later. There really is nothing else like the Sagrada Familia in the world. It is intricate beyond words, completely unique and is an essential trip when in Barcelona. If your interests are geared towards relaxation and leisure more than exploring one of the great cities of Europe then Barcelona might still be the place for you. The city’s seafront was mostly ignored before 1992 when the Olympic
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Games arrived in town and proved to be a catalyst for regeneration. The old industrial buildings which populated the area were torn down and replaced by miles of golden beachfront and marinas which have helped to change the face of Barcelona. Food is a big deal in Barcelona and today you will find the best seafood restaurants along this beach which runs from Port Vell, through Port Olimpico up to the Forum. The proximity of the sea and the inland mountainous regions means the local cuisine has great variety, a sort of ‘tapas plus’ arrangement. You will find toasted bread with tomato, olive oil and salt in every bar and restaurant and it really is just the best snack imaginable. Other common local specialities you will come across include the local spicy sausage, Botifarra, a Catalan stew called Escudella, a Catalan paella made with squid ink and noodles instead of rice called Fideua, and Calcots, leeks which are barbecued and eaten with Romesco sauce. There is also a strong contingent of excellent Basque restaurants in Barcelona which provide the local scene with even greater variety. Catalans live by a mix of Seny and Rauxa, common sense and passion, and when it comes to the passionate side of things they certainly know how to celebrate. Instead of Valentine’s Day, people proclaim their love
in April on La Diada de Sant Jordi, the day of their patron saint, by giving each other roses and books. There is a seemingly endless series of street parties all year round and every September the whole city comes together to celebrate La Mercè, a Roman Catholic festival honouring the Virgin of Grace. There is music, dancing, a wine fair and parades including giant papier machÊ people on floats. Another regional quirk not to be missed is the Castellers, the enormous human towers comprised of hundreds of people. Barcelona is also a city mad for football with both RCD Espanyol and FC Barcelona based in the city. Both clubs have long and winding histories and inspire a great deal of pride in the locals, with FC Barcelona in particular being incredibly successful in recent years. These clubs carry La Senyera, the flag of Catalonia, across Europe and the world. There are not many cities in the world like Barcelona. It is a special city full of proud and interesting people which anyone should be happy to call home.
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Specialists at providing buy-to-let properties to the private investor market, Knight Knox has a wide range of developments available across the UK. Working alongside a team of experienced developers, solicitors and agents allows Knight Knox to provide expert advice and guidance on a range of investments. Over the next 29 pages you will see a selection of the investment opportunities available through Knight Knox.
+44(0)161 772 1370 www.knightknox.com The Best of UK Buy-to-Let
X1 AIRE Leeds PRICES FROM :
ÂŁ105,000 > 6% NET rental returns 1 and 2-bedroom apartments Lettings and management company in place Private communal facilities State-of-the-art apartments Prime location in the heart of Leeds
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X1 Aire is Knight Knox’s newest development in the heart of the thriving city of Leeds. This development is set to provide state-of-the-art living for a vastly undersupplied Leeds rental market, providing a stunning array of apartments ranging from bespoke studios to stunning penthouses. X1 Aire is set to take boutique city centre living to the next level, providing state-of-the-art apartments to the private rental market.
IN CONSTRUCTION
SILKHOUSE COURT Liverpool PRICES FROM :
ÂŁ99,995 > Circa 5.9% predicted NET returns Unbeatable city centre location Liverpool rental market is booming Excellent city centre location Close to regional and national transport links Fully let and managed by an experienced letting agent
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Silkhouse Court provides the ultimate modern living experience. Each apartment comes complete with beautiful, top-of-the-range furnishing and fixtures, carefully selected by the development team to suit the dwellings. Residents will be provided with a number of convenient on-site amenities. The private gymnasium on the Ground Floor is open for all residents, and the concierge service is there to make modern living simpler for the busy young professional.
X1 THE GATEWAY Salford Quays PRICES FROM :
ÂŁ100,000 > Circa 6% predicted NET returns Situated in a prime residential area Within easy walking distance of MediaCityUK Let and managed by X1 Lettings Great on-site facilities Waterfront views
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With a sleek, modern design, a luxurious finish and set in a desirable location; this new residential development raises the bar when it comes to providing future tenants with a first class cosmopolitan living experience. Situated in the heart of the Quays, this prime residential development brings a mixture of 191 stunning 1, 2 and 3 bedroom apartments to market.
ADELPHI WHARF PHASE 3 Salford PRICES FROM :
£119,995 > Circa 6% predicted NET returns Excellent local infrastrucutre 10 minutes walk to central Manchester Experienced managing agent Great transport links and close to shopping Chronic undersupply of housing in Manchester and Salford
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The eagerly anticipated third phase of Knight Knox’s incredibly successful Adelphi Wharf project has arrived. Located in one of the UK’s buy-to-let property hotspots, Greater Manchester’s popular region of Salford, Adelphi Wharf Phase 3 follows on from the two previous sold out phases. Investors were understandably enamoured with the development’s attractive modern apartments, superb location and the area’s ever-growing rental demand.
NEW LAUNCH
X1 THE CAMPUS Salford PRICES FROM :
ÂŁ89,995 > Circa 6% predicted NET returns Built by experienced developer; X1 Close to excellent public transport links Close to local shops, bars and restaurants On-site gym Private student accommodation is a booming investment class
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X1 The Campus will consist of 271 student studio apartments split over two blocks and eight floors within the University of Salford Frederick Road Campus. Salford plays host to everything which a modern student could possibly want from a university city – not just a fantastic university which is a leader in its field, but also a range of pubs, restaurants and shops in the local area.
NEW LAUNCH
X1 MEDIA CITY TOWER 3 Salford Quays PRICES FROM :
£114,995 > Circa 6% predicted NET returns Studios, 1, 2-bedroom apartments Lettings and management company in place Private communal facilities Great transport links and close to shopping Most exclusive development outside of London
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The penultimate tower in X1 Media City will follow in the footsteps of its predecessors, offering high-end residential living in a highly sought-after area. This development’s stunning glass-fronted exterior perfectly epitomises the luxury within, and is just a stone’s throw away from the iconic MediaCityUK site on the picturesque Salford Quays waterfront.
LAST APARTMENT S REMAINING
BRIDGEWATER GATE Manchester PRICES FROM :
ÂŁ114,995 > Circa 6% predicted NET returns Predicted NET rental yields of 6% Lettings and management company in place Private communal facilities Built by an experienced developer Great transport links and close to shopping amenities
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Bridgewater Gate is enviably located on the edge of Manchester city centre in the thriving area of Castlefield. This luxurious development will have all the advantages of being a short walk away from the local parks and independent shops of suburbia, but also the vibrant bars and restaurants of the city. It also sits within walking distance of MediaCityUK, the new home of the BBC.
NOW SOLD OUT
IN CONSTRUCTION
X1 THE PLAZA Manchester PRICES FROM :
£110,000 > 6% NET rental returns 1, 2 & 3-bed apartments and townhouses Beautiful balconies with dynamic city views Prime city centre location Within walking distance of local amenities Experienced management company in place
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X1 The Plaza is the newest addition to the Manchester skyline, set to provide 201 luxury apartments to the prime undersupplied residential market in the area. The widespread success of the nearby X1 Eastbank project in the heart of Manchester’s newest up-and-coming district of New Islington shows the sheer level of demand in the area—both investors and tenants alike are flocking to the area, seeking bespoke investment and living opportunities in such a vibrant area.
NOW SOLD OUT
X1 LIVERPOOL ONE PHASE THREE Liverpool PRICES FROM :
ÂŁ79,995 > 6.61% NET rental returns Quality fixture and fittings Fully-furnished Phase 3 comprises 92 apartments Located in the centre of Liverpool city centre High rental demand in the area
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To capitalise on this almost insatiable student demand for luxury accommodation, the third phase of X1 Liverpool One consists of a selection of luxury studio and penthouse apartments, all of which are fully furnished* and finished to the highest of standards. As well as ultramodern features, which perfectly befit luxury student living, residents of X1 Liverpool One will also benefit from stunning views of either the dynamic city of Liverpool, or its incredible skyline. *furniture subject to an additional charge
IN CONSTRUCTION
X1 MEDIA CITY TOWER 2 Salford Quays PRICES FROM :
ÂŁ104,950 > 6% NET rental returns Studios, 1, 2 and 3-bedroom apartments Lettings and management company in place Private communal facilities Great transport links and close to shopping Most exclusive development outside of London
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With 1,100 apartments covering an area of approx. 544,820sqf, X1 Media City is one of the largest residential developments in the North West. The development itself consists of four iconic towers, each containing a mixture of studios, one, two and three-bedroom apartments. With spectacular views over the city and MediaCityUK, the apartments are available fully furnished* with a high-end, elegant flair. *furniture subject to an additional charge
NOW SOLD OUT
IN CONSTRUCTION
NOW SOLD OUT
MULBERRY PLACE Salford PRICES FROM :
£109,000 > Circa 6% predicted NET returns Highly sought-after location Lettings and management company in place Close to Salford and Manchester City Centres Excellent local transport links Salford named ‘UK Buy-to-Let Hotspot’ 2014 and 2015
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Located in the heart of Salford, Mulberry Place brings 38 chic apartments to the city’s thriving buy-to-let market in the form of spacious one and two bedroom apartments. Residents of Mulberry Place will also benefit from excellent on-site facilities such as a beautifully landscaped communal courtyard, bicycle storage and off-street car parking spaces provided for selected apartments. Some apartments will also enjoy the benefit of having their own balcony.
NOW SOLD OUT
THE TERRACE AT X1 THE QUARTER Liverpool PRICES FROM :
ÂŁ109,950 > 6% NET rental returns Assured 6% rental income for 5 years Fully managed and let by X1 lettings Great central location High-end fixtures and fittings Built by experienced developer
The Terrace is the fourth phase of the highly successful X1 The Quarter development (Phase 1 The Gallery and Phase 2 The Courtyard are fully tenanted with Phase 3 The Studios in construction). This development is set to be a 101-unit new-build in the vastly popular city of Liverpool, launched as a direct response to the incredible demand for prime residential apartments in the region, shown by the incredible success of the previous phases.
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ADELPHI WHARF PHASE 2 Salford PRICES FROM :
ÂŁ114,995 > Circa 6% predicted NET returns Excellent local infrastrucutre 10 minutes walk to central Manchester Experienced managing agent Great transport links and close to shopping Chronic undersupply of housing in Manchester and Salford
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Adelphi Wharf Phase 2 contrasts city and country living. Located in Salford, bordering directly on Manchester city centre, Adelphi Wharf is a picturesque property overlooking the beautiful River Irwell. Residents of Adelphi Wharf can pick from a range of high-end studios and luxury townhouses, as well as bespoke one, two and three-bedroom apartments.
NOW SOLD OUT
IN CONSTRUCTION
RATHMELL HALL York PRICES FROM :
ÂŁ69,950 > Circa 6% predicted NET returns Luxury student accommodation Great central location On-site gym and laundry room Built by an experienced developer High demand in local area
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Comprising 63 units in the form of chic studio apartments, which are available as classic, premium, deluxe and deluxe plus investment options. All units come fully furnished with en-suite bathroom, a high quality fitted kitchen in a contemporary style, as well as benefiting from a high speed broadband connection. Rathmell Hall is the ideal student accommodation for the students of York – not only does it offer its tenants luxury living quarters, but it also provides them with on-site communal amenities to allow its student tenants to get to know each other.
NOW SOLD OUT
NOW SOLD OUT
THE COURTYARD AT X1 THE QUARTER Liverpool PRICES FROM :
ÂŁ89,950 > 6% NET rental returns Finance options available Experienced management company in place Proven rental demand 5 minute walk to Liverpool ONE Opposite Liverpool Marina
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Built by an experienced developer in the residential buy-to-let market, The Courtyard at X1 The Quarter presents a unique concept in luxury living for the residents of Liverpool. Completed in September 2014, the development contains 77 modern 1, 2 and 3 bed apartments, in addition to 3 bed townhouses. Offered at an extremely competitive purchase price and with virtually no maintenance required due to the new-build status of the development.
SPECTRUM Manchester PRICES FROM :
ÂŁ172,950 > Circa 5.5% NET rental returns Completed and te nanted development Private landscaped gardens Great central location Built by experienced developer High quality fixtures and fittings
Spectrum delivers the best of both worlds, combining chic, urban living with the tranquility of private landscaped gardens. The studio, one, two and three-bedroom apartments are finished to the highest specification, with floor-to-ceiling windows and full-length balconies in most apartments. Light floods into the living space and views across the city are a constant reminder of how close you are to everything you could want.
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NOW SOLD OUT
BELLS COURT Sheffield PRICES FROM :
ÂŁ69,995 > 7% NET rental returns Assured 7% rental income for 1 year Fully-furnished Excellent city centre location Luxury studio apartments High rental demand in Sheffield
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A brand-new residential project located in the heart of the highly popular student city of Sheffield. It supplies the burgeoning buy-to-let market in Sheffield with a total of 29 state-of-the-art studios apartments. Bells Court provides a mix of luxury studio apartments, perfect for both students and young professionals alike. Demand is high for prime accommodation in Sheffield, with its rising house prices and thriving rental market.
LOOKING FOR PROPERTY TO BUY? BE SURE TO VISIT THE
The UK’s largest and longest running property investment event is presented at ExCeL London every April and October. The major names in UK and international property will be out in force with plenty of ‘off-market’ bargain deals and show exclusives to choose from.
E FREW
SHO Y ENTR
REGISTER ONLINE AT www.propertyinvestor.co.uk NOTE: Seminar booking opens approximately 6 weeks before show opening day
THE BEST OF UK BUY-TO-LET New-build buy-to-let Studios, 1, 2 & 3-bed apartments available Management companies in place In prime locations across Manchester, Liverpool & leeds
PRICES FROM ÂŁ89,995