Commercial & Development
4th QUARTER 2019
See page 5...
On page 3...
Commercial property in long term family ownership sold in Bromley...
On page 4...
Consented development site in prime central Greenwich sold...
On page 5...
Local experience and a proven track record pay dividends...
On page 6...
Retail space in affluent secondary parades proving popular...
EDITORIAL
There’s no doubt that the political instability lead to a tumultuous final quarter, but with hindsight it was all a storm in a tea cup, wasn’t it? Granted, the landscape would likely have been somewhat different had the red corner won on 12th December, but whilst we still have Brexit to endure, it seems that all the property market was waiting on was that general election result.
Jeff East — Director
jeff.east@acorngroup.co.uk
We had a storming finish to the year, and in those few post-election working days alone, put more than £10M of property under offer. Whether we ultimately enjoy a ‘Boris Bounce’ or suffer a ‘Brexit Bump’ remains to be seen, but the current outlook certainly looks rosier than it has for many months.
It’s fair to say that 2019 was challenging, but certainly not without its successes. In speaking to regular clients it seems that most are suffering the frustrations of planning delays. Few, if any applications are being determined within the statutory periods, and almost every project requires at least 6 months of pre-application work. The cherry on the cake is the fact that most S106 Agreements are taking another 6 months to conclude post resolution! With this in mind many unconditional buyers are being more cautious, and landowners are being forced to accept that longer term conditional contracts are now an inevitability.
Printed on recycled paper #ChooseToReuse
Speculators looking for more regular turnover have moved to existing buildings. Shops and upper parts, unbroken blocks and redundant commercial freeholds are proving more popular than ever and whilst the margins aren’t huge, every new instruction has the phone ringing off the hook.
Small shops and cafés also continue to prove popular – particularly on strong secondary parades. Very few shops let for less than £15,000pax nowadays, and with a more attractive tax position, commercial investments are being snapped up by buyers that previously focused on residential buy-to-let. There have also been signs that sellers are becoming more discerning about their choice of agent. Individual operators are struggling, with many slowly realising that running a LinkedIn account from your gym isn’t necessarily the key to success in the property industry. We’ve also been favoured over traditional West End firms in several key matters. That’s not to say those agents aren’t very capable, but local knowledge and a wide contact base are both required in order to maximise value.
In group news we continue to buck the trend. We’re absolutely committed to traditional high street agency, and believe that online services will only ever complement, but not replace local experts, in local offices. We opened new offices in Woolwich and Northumberland Heath in 2019, and acquired East Dulwich’s ‘Property In’ business from our good friend Steve Smith. We’ve got big plans for 2020 too with new branches in Belvedere and Rainham opening imminently, and a wide geographical area between those two locations to concentrate on. In order to keep up with the group’s expansion we intend to double the size of our team, and establish a dedicated commercial letting arm over the next 12 months. With that in mind, recruitment is a high priority!
CHISLEHURST BR7
During the final quarter of 2019 we were instructed by the British Red Cross to dispose of this property in the centre of Chislehurst. The world-renowned charity had owned the property since 1957, but with it surplus to requirements, were keen to reinvest the proceeds of a sale back into their missions.
We’re well versed in acting for charities and other institutional clients, and understood that a comprehensive marketing exercise had to be undertaken in order to satisfy the requirements of the 1993 Charities Act; ensuring best value was achieved. With more than 4,000sqft of built space, a large yard and B1/D1 uses, the property appeared suitable for a variety of purposes. Our marketing generated strong interest, and offers from a variety of purchasers. The successful bidder was a private local investor who already owns a number of mainly commercial properties in the immediate vicinity.
2
1 Sherman Road, Bromley, Kent BR1 3JH 020 8315 5454
120 Bermondsey Street, London SE1 3TX 020 7089 6555
acorncommercial.co.uk commercial@acorngroup.co.uk @acorncommercial
BROMLEY BR2 We really enjoy the diverse range of property transactions that we manage, and the interesting history that comes with many of them. When we were asked by an elderly gent to advise on the likely value of a commercial property in Bromley, it transpired that it had served as the base for a family-run electrical contracting business since the 1940s. After 80 years of trading, the owner was closing the business and intended to sell.
With freehold property of this nature in very short supply, we advised that the site offered an opportunity for continued commercial use and apparent development potential, and were confident of generating premium offers. We held several busy block viewings, and received numerous offers on varying terms. Ultimately an unconditional offer was made that was simply too good to refuse – our client received all the money for the site, without having to wait for planning permission to be granted.
If you’re closing your business, relocating or would just like to understand the value of your commercial property please don’t hesitate to get in touch. We’re always happy to offer free advice.
PECKHAM SE15
Whilst only 1,400sqft and offering no outside space at all, this freehold workshop forms a prominent corner of a wider site in the ‘Peckham Core Action Area’. Our client, a local building contractor, had been in occupation for over 20 years, and quite understandably wanted to achieve the best price possible in the event of a sale. Given the obvious development potential of the wider site and the varied ownerships of adjoining buildings, we were very confident that an open marketing campaign would encourage a neighbouring owner to pay a premium.
We invited offers in excess of £600,000, which at £428/sqft for B1/B2 space certainly isn’t cheap, but surprised even ourselves with how well the marketing went. We ultimately completed an unconditional sale to a cash buyer at £780,000. That’s 30% more than our guide, and a staggering £557/sqft for workshop space with no further planning permission! Unsurprisingly the seller was delighted with the result, and there’s nothing we like more than a happy client.
With or without development potential, freehold commercial properties that offer inherent bricks & mortar value are hotly contested in the current market. Give us a ring – you might just be surprised by what your property is worth.
1 Sherman Road, Bromley, Kent BR1 3JH 020 8315 5454
120 Bermondsey Street, London SE1 3TX 020 7089 6555
acorncommercial.co.uk commercial@acorngroup.co.uk @acorncommercial
3
GREENWICH SE10 We acquired this derelict former public house for a private client via auction in early 2016, and were subsequently retained to promote the site for redevelopment.
Given that the building (which had been vacant since the early 1990s) is structurally unstable, not protected nor sat in a conservation area, many would have expected a straightforward run through planning. The current planning system just doesn’t allow for ‘straightforward’ though, and it took three applications over more than two years before planning permission was granted for six luxury apartments above a duplex office unit.
We explored the opportunity to have the development completed for long-term investment, but with consented sites continuing to command a premium, the property was offered for sale.
Several offers were received, and terms ultimately agreed with an overseas investment company. Contracts were exchanged at more than 40% of the Gross Development Value, and completion took place in October 2019.
We’re always keen to hear from landowners with development opportunities to sell. Consented sites are our specific area of expertise – we’ll know to the nearest penny what your site is worth, and always have reliable buyers willing to pay a premium for the right opportunity.
SWANLEY BR8 We recently completed the sale of this surplus Kingdom Hall in Swanley on behalf of long-term clients, the Jehovah’s Witnesses.
We’ve regularly worked for the Jehovah’s Witnesses for over 15 years now; a relationship that resulted from our working tirelessly for another institutional client, Barnardo’s: The Witnesses acquired a site from Barnardo’s in Forest Hill, and were so frustratingly impressed at how hard a bargain we drove, that we were appointed to act in the sale of their next property that became surplus! The Witnesses’ following is growing rapidly worldwide, and the funds they generate from asset sales in the First World are being reinvested to support congregations in less developed areas. When the call came for us to act in the sale of their Swanley Kingdom Hall we set about pursuing a high profile, national marketing campaign which saw us generate more than 150 enquiries, and 25 offers within a 4 week window. Furthermore the sale was completed at a smidge over £800,000 – 35% ahead of our guide price! If your community group or charity requires expert property related advice please contact one of our offices.
4
1 Sherman Road, Bromley, Kent BR1 3JH 020 8315 5454
120 Bermondsey Street, London SE1 3TX 020 7089 6555
acorncommercial.co.uk commercial@acorngroup.co.uk @acorncommercial
PECKHAM SE15 It’s very difficult for any agent to be truly effective without local knowledge, a good reputation and a proven track record. Without these fundamental qualities we simply wouldn’t have been able to assemble this development site on Ilderton Road in Bermondsey. A chance meeting one morning with a client of ours alerted us not only to his proposed purchase of an industrial site within the Old Kent Road regeneration area, but also of his unsuccessful attempts at brokering a deal with the adjoining landowner. Half of the site wouldn’t work, and so the acquisition of the neighbouring property was critical. Several other agents had been scorned by the seller, but being a prominent local landlord, we’ve known him for years.
Whilst well aware that our approach was on behalf of the same potential buyer, our track record and long-standing relationship with the seller ensured that he took us seriously. We quickly agreed a deal that worked well for both parties, and planning permission was granted for the construction of 48 apartments and c.5,000 sqft of commercial space. Our reach and reputation are such that there aren’t many buyers or sellers of commercial, development and investment properties across South London and North Kent that we haven’t met in the last 20 years. This serves us well, and enables us to make a difference where others simply can’t.
DULWICH SE22
If you were to ask any local developer what they’d be looking for in the ideal site, most would want a scheme for freehold houses in a popular postcode, and close to a decent station.
With that in mind, we were very bullish when asked to advise on the likely value of a smart scheme for 7 three bedroom houses adjacent to East Dulwich Station. Despite having owned the site for many years, the seller was keen to avoid the delays of a marketing process, and conclude a deal prior to the festive break. We were able to quickly introduce a buyer with whom we’d dealt previously, and agree terms at nearly 40% of the GDV. A comprehensive pack of legal and technical information was provided, the buyers completed their due diligence promptly and contracts were exchanged within three weeks of receipt. We’ve been South London’s leading agents in the sale of development sites for over 20 years, so if you have a site to sell please contact us for some free, forthright advice.
1 Sherman Road, Bromley, Kent BR1 3JH 020 8315 5454
120 Bermondsey Street, London SE1 3TX 020 7089 6555
acorncommercial.co.uk commercial@acorngroup.co.uk @acorncommercial
5
IN A NUTSHELL
6
1 Sherman Road, Bromley, Kent BR1 3JH 020 8315 5454
BROMLEY BR1
BERMONDSEY SE1
Retail space on secondary parades in affluent areas are proving as popular as ever. This unit is opposite Sundridge Park Station, and was let to a grocer for £14,000pax.
Ground floor self-contained office suite approx. 750 sqft. The property is fitted-out to a high standard and offers direct street frontage. Let to a digital marketing agency for 5 years at £26,000pax.
BROMLEY BR2
FOREST HILL SE23
Prominent unit benefiting from open-plan layout and dual frontage. Two tenants competed for the space, and we ultimately concluded a letting to neighbouring solicitors Amphlett Lissimore for £24,000pax.
Derelict mixed-use freehold comprising shop and upper flat. Positioned in a popular area, and complete with its own rat colony! A sale was concluded to a building contractor for long term investment.
ANERLEY SE19
NEW CROSS SE14
Freehold lock-up shop with A1/A2 use. A rare opportunity to acquire a small freehold commercial property in the London Borough of Bromley. A sale was concluded to a beauty salon operator.
Income-producing mixeduse building comprising restaurant across the ground floor, with a two bedroom flat above. Currently producing £28,792pax; we sold the freehold to a private investor for £420,000.
BECKENHAM BR3
LONDON SE24
Good space continues to prove hotly contested, and we had several prospective tenants chasing this retail unit on Beckenham High Street. The property was let to Mears Funeral Directors at £22,000pax.
Three redundant railway arches opening onto a major Peabody-owned site in Loughborough Junction. Our marketing ensured best value, and we sold on behalf of liquidators to Peabody for £340,000.
120 Bermondsey Street, London SE1 3TX 020 7089 6555
acorncommercial.co.uk commercial@acorngroup.co.uk @acorncommercial
MEET THE TEAM
Adam Hosking Head of Agency
Jeff East Director
Tom Luck Director
Lily Whitby Senior Secretary
Steven Flannighan Commercial & Development Agency
Jamie Stevenson Commercial & Development Agency
Louis Markham Commercial & Investment Agency
Freya McKeogh Commercial Agency
We are actively recruiting trainee and experienced staff for commercial and development agency roles. If you are interested in joining our team, please send your CV to Rosie Davis Team Secretary
lily.whitby@acorngroup.co.uk
Hollie White Team Secretary
REPORTS IN NEXT ISSUE SOLD
SOLD
CROYDON
SOLD
SIDCUP
SOLD
EAST DULWICH
LET
BEXLEYHEATH
SOLD
CATFORD
1 Sherman Road, Bromley, Kent BR1 3JH 020 8315 5454
ELEPHANT & CASTLE
120 Bermondsey Street, London SE1 3TX 020 7089 6555
acorncommercial.co.uk commercial@acorngroup.co.uk @acorncommercial
7
Visit the new home of property in South East London and Kent. Our brand new website brings together all The Acorn Group brands, divisions and services under one simple URL. Whatever your property requirement, visit acorngroup.co.uk/about today and see how we can help!