2nd QUARTER 2021
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Redundant car park with planning permission...
Development site sold with consent for 11 houses...
Block of 4 maisonettes with potential...
The Acorn Group’s property journey...
EDITORIAL The second quarter of 2021 continued much as the first began – crazy busy! Interest in freehold properties and development sites has been unprecedented, and we’ve had to bolster the team simply in order to manage the sheer volume of enquiries.
Jeff East — Director
jeff.east@acorngroup.co.uk
Mixed-use freeholds are consistently selling for more than their piecemeal value, and we’re typically generating at least a dozen viable offers for each individual property. Cash is king, and if you’re in the market to buy be prepared to bid very strongly! Development sites similarly are selling very well, and the recent sale of several consented sites are reported in this Update. Given that a pre-app takes 6-9 months nowadays, and validation of an application is typically doubling the statutory period for determination, it’s no surprise that sites with a ticket are an increasingly attractive proposition. Let’s face it, the planning system is well and truly broken, and it isn’t going to be fixed any time soon. Whilst I’m also increasingly hearing reports of massively extended time-frames for planning condition sign-offs, and long lead times for materials, the reality is that builders won’t wait for LPAs to deal with pre-commencement conditions, and they’ll find their materials by hook or by crook. I certainly don’t see either
issue having a negative impact on land values or demand any time soon. We added Tom Lewin to the team during the second quarter, and have two other new starters joining us in the early summer. In wider Group news it’s been exciting watching the residential sales numbers over the last 6 months. The sheer number of deals concluded by our 40 branch network is staggering, and the month in the lead-up to the SDLT holiday deadline was particularly entertaining (as an outsider)! Our new Gravesend branch opened in May; adding to the Strood & Rainham offices that we already have along the A2 corridor. There’s more to come from us in Medway, so watch this space. Clearly all sectors of the market are driven by supply and demand. The massive demand we’re experiencing at present leaves us short of supply, and as such we’re urgently seeking more instructions. If you’re at all considering selling a vacant freehold, investment or development site, please get in touch. There’s never been a better time to sell, and we’re masters at achieving the best possible price. I’d be delighted to hear from any potential sellers personally, and can be contacted on 020 8315 5454. I hope you enjoy this Update, and as always, would welcome any questions.
LIMEHOUSE E1
Existing site
This redundant car park just off Commercial Road was offered for sale with full planning permission for the construction of 4 contemporary townhouses. Located in the popular York Street Conservation Area we anticipated in the region of £850/sqft for the finished units; giving a GDV of £3.3M. The strength of our database came to the fore; enabling us to generate lots of interest from a variety of would-be buyers. Having short-listed several offers, terms were agreed with a private developer at £1.45M.
Approved scheme
We’d spoken to the preferred bidder in connection with several other properties previously, and were pleased that he topped the bidding on this occasion – it’s always nice to conclude a first deal with a new contact. If you’re looking for a development site and aren’t currently registered on our database please get in touch. We manage the sale of everything from a single plot to large strategic opportunities, and we’re always keen to make new friends!
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9 St. Marks Road, Bromley, Kent BR2 9HG 020 8315 5454
2 North Street, Strood, Kent ME2 4SH 01634 969678
CROYDON CR0
Existing building
The sale of consented development sites has always been our forte, and whilst we’ve diversified over the last 20 years, sites with a ticket are still our bread and butter. Two decades ago the skill of a development agent centred on his or her relationships with the local players in the market (I still have my little black book). Nowadays the buyers come from far and wide, and marketing exposure is key. We use national advertising, social media, our 40 branch estate agency network and specialist New Homes sales division to maintain a database of around 17,000 applicants at any given time. Fortunately we’re paperless, otherwise that little black book would resemble the Yellow Pages by now! Our development team was recently instructed to manage the marketing and sale of this prime site in central Croydon. Planning permission had been secured for the demolition of the existing apartment block, and construction of two buildings comprising 43 new residential units. Affordable Housing requirements in most London boroughs are strong, and Croydon is no exception. In this case 12 of the 43 units had to be made available for affordable housing under a Section 106 Agreement; along with financial contributions and CIL of almost £600,000! We entertained interest from private developers, Build to Rent specialists and Housing Associations, and worked hard to meet the vendor’s aspirations in terms of price. Terms were agreed to a buyer not previously known to us and relative to the complexities of the site, the sale was concluded smoothly. We achieved £4M, which equates to a little under £130,000 per private unit. Help to Buy is still very much driving demand from end-users and in turn, developers, so if you have a consented site to sell please get in touch.
Approved scheme
120 Bermondsey Street, London SE1 3TX 020 7089 6555
acorncommercial.co.uk commercial@acorngroup.co.uk @acorncommercial
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BEXLEYHEATH DA6
A cleared, freehold development site with full planning permission for the construction of 11 houses, all within the Help to Buy limit – a straightforward sale, right?? Well yes, in a way, but we’re all about maximising value, and our clients had high aspirations! This particular site came with a relatively strong CIL liability and a prohibitive S106 with a late review mechanism. None of the above would preclude a sale, but the combination of all three had a major impact on the land value to a private developer. Whilst we entertained interest from a variety of buyers, we knew that a Registered Provider (Housing Association) would be able to pay a premium, if indeed we could find one with an appetite for a small scheme in Bexley. RP’s don’t pay CIL and given their mission to develop ‘affordable housing’, the financial impact of the S106 could be negated. Furthermore, if the finished units weren’t to be sold in the open market, the late review mechanism wouldn’t apply. We’ve dealt with Hexagon multiple times over the last 20 years, and were able to agree terms that met our clients’ heady expectations. Hexagon completed their purchase of the site in May 2021; further adding to a strong pipeline of business for 2022. Please get in touch if you want big money for your development site!
SEVENOAKS TN15
sympathetically compliment the local environs.
Despite occupying an elevated position in an Area of Outstanding Natural Beauty within easy reach of the London suburbs, the former Woodlands Manor Golf Club was unviable and closed permanently in January 2019.
Whilst little interest was forthcoming for the site as a going concern, once planning permission had been secured we had no trouble generating offers for the development site. Extending to more than 11 acres, and offered with full planning permission for the construction of over 11,700sqft of new residential accommodation, the site was sold for a shade under £2M.
Comprising three distinct land parcels dissected by public highways, we offered the property for sale as a whole or in parts. Alongside our marketing the seller made a planning application for the replacement of the existing club-related buildings with four detached houses designed to
Our client has retained the remaining 120 acres of land for other projects, so watch this space! In the meantime, if you have a consented development site to sell please get in touch – we always have a long list of potential buyers, and pride ourselves in achieving the best possible price for the seller.
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9 St. Marks Road, Bromley, Kent BR2 9HG 020 8315 5454
2 North Street, Strood, Kent ME2 4SH 01634 969678
SYDENHAM SE26
Having provided a complimentary probate valuation in 2020, we were delighted to secure instructions to manage the sale of this unbroken apartment block on the popular Thorpe Estate. Our client had been keen to sell the four apartments and freehold interest on a piecemeal basis. Whilst such a strategy would typically be the best way of maximising value, in this case our advice was to sell the property as a whole. Our logic was that the property offers apparent future development potential that would disappear in the event of a piecemeal sale. We were confident of not only exceeding the piecemeal values, but also securing a sale on a far more straightforward basis.
Our client expected to achieve £1.2M, but we knew we could generate sufficient interest to achieve a premium. The strength of our database ensured a huge volume of enquiries, and we received 15 bids over the guide. We’d worked with the seller’s solicitor to put a legal pack together in advance of the marketing; enabling us to quickly exchange contracts at a 15% premium. Our advice is tailored to the nature of each property and requirements of each seller, and we’re not ashamed to admit that our aim is to always achieve the best possible price. After all, you can only sell your property once!
CROYDON CR9 After more than half a century of use by their business, this prominent builder’s merchants site became surplus to requirements and the owners began to explore the notion of a sale. Given the obvious development potential the owners submitted a pre-app themselves, but then endured a couple of false starts with developers on a conditional basis. We tracked their progress (or lack thereof), and always held the view that the existing use value might be a little too strong for a developer to overcome. The 0.38 acre plot includes commercial, warehouse and yard space which is rarely available in a roadside location; particularly on a freehold basis. We advised that by adopting a full and thorough marketing campaign we were confident of generating unconditional offers at a similar level to the previously unsuccessful conditional bids. Our two block viewings were attended by more than 40 parties, several offers were received and a sale was promptly agreed with a commercial owner-occupier who had been looking for a freehold premises in the area. The price achieved was on par with the conditional offers previously entertained by our client. Given that the sale was unconditional though, contracts were exchanged within 4 weeks, and completed just a couple of weeks later. Whilst a property may well offer development potential, sometimes the best value rests in the existing bricks and mortar. Please get in touch if you have a similar property to sell.
120 Bermondsey Street, London SE1 3TX 020 7089 6555
acorncommercial.co.uk commercial@acorngroup.co.uk @acorncommercial
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IN A NUTSHELL
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NEW CROSS SE14
CAMBERWELL SE5
Mixed-use freehold with active management angles comprising 1,500sqft of vacant ground floor E class space, with three selfcontained 2 bedroom flats above. Sold to a private investor for £1.2M.
Double retail unit c.5,400sqft in large mixed-use development. Let in the midst of the Coronavirus pandemic, shell and core, to a Budgens franchisee at £65,000pax. Similar instructions required.
DARTFORD DA1
CHISLEHURST BR7
Freehold town centre development site with full planning permission for the construction of 11 new apartments over ground floor commercial space. Sold to a local developer for £750,000.
Attractive freehold investment on the everpopular Royal Parade. Unbroken building with future angles let at £22,000pax to a charity shop with 7 years unexpired. We achieved £435,000 (4.7% NIY).
BOGNOR REGIS PO21
WEST WICKHAM BR4
Vacant former care home comprising 32 bedrooms and ancillary accommodation across more than 11,000sqft. Sold to a private investor for £750,000 despite planning refusal for conversion to HMO.
Mid-terrace mixed-use investment comprising shop let at £7,200pax, and upper flat with rear access let on AST at £9,600pa. Sold to a private investor for £325,000 – a NIY of just 4.8%.
BEXLEYHEATH DA6
LOCKSBOTTOM BR6
Prominent freehold comprising vacant triple shop unit c.3,100sqft with ground rent income from three upper flats. Sold to an investor for partial owner-occupation at £700,000.
Good quality first floor office suite on the A21 at Locksbottom. Extending to c.1,646sqft, we introduced a training provider on a new lease at £25,000pax. Similar office instructions required.
9 St. Marks Road, Bromley, Kent BR2 9HG 020 8315 5454
2 North Street, Strood, Kent ME2 4SH 01634 969678
MEET THE TEAM
Jamie Stevenson Commercial & Development Agency
Louis Markham Commercial & Investment Agency
Steven Flannighan Commercial & Development Agency
Rosie Davis Team Secretary
Adam Miles Commercial & Development Agency
Izaak Thomas Commercial Agency
Jarrel Walcott Projects Assistant
Tom Lewin Projects Assistant
Could This Be You? If you are interested in joining our team, please contact Jeff East on 020 8315 5454.
Lily Whitby Senior Secretary
Jeff East Director
Tom Luck Director
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120 Bermondsey Street, London SE1 3TX 020 7089 6555
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acorncommercial.co.uk commercial@acorngroup.co.uk @acorncommercial
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