THE UPDATE 2 ND QUARTER 2018
See page 4...
On page 3... Our development team was appointed to sell this consented site in South Norwood…
On page 4... Mixed-use freehold property with planning permission sold in Battersea…
On page 5... The power of social media helps us sell two offices in Bromley...
YOU ARE WHAT YOU READ call for unwanted books
On page 8...
1 Sherman Road, We’re building Have you heard? Bromley, Kentlibrary BR1 3JH a brand new for St Saviours 020 8315School… 5454 Primary
120 Bermondsey Street, London SE1 3TX 020 7089 6555
acorncommercial.co.uk commercial@acorn.ltd.uk
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EDITORIAL As was largely expected, the second quarter of 2018 saw no gathering of pace in the market from the first, but as the slight delay in the production of our Second Quarter Update will attest, it’s been far from quiet.
Over many years we’ve earned a reputation as the ‘go-to’ agent in the sale of development sites; and particularly those with planning permission in place. With that in mind, and given the undoubtedly challenging residential market, we’re regularly asked about the impact on appetite for residential development land. The short answer is that demand remains high, and land values are holding up, but the back story certainly isn’t as rosy as it was 24 months ago. We’re seeing a heavier reliance on finance, and more consistent downvaluation. Buyers and their funders are also far more focussed on the resale market and the rate of sale they can expect on their finished product in 12-18 months’ time. The role that a specialist agent fulfils is therefore more vital now than it has been for many years. We have the land sale evidence and residential comparables to help comfort bank valuers, and the sales prowess, track record and statistics to encourage the mezzanine or PE funders that most deals seem to involve nowadays. So, back to the short answer. Demand remains high and land values are holding up, but it certainly isn’t plain sailing and you’ll need an experienced, high-profile agent to extract the best value from your consented development site.
Jeff East - Director jeff.east@acorn.ltd.uk
Another hot topic recently has been the ‘demise’ of the High Street, and again our counsel is sought on this subject frequently. The reality from our perspective is probably slightly skewed by virtue of the fact we don’t operate nationally. We do, however, handle more than our fair share of retail transactions in South London and North Kent, and the pattern is changing. Yes, many of the big-name chains are closing stores, but for the time being
there’s always the next best thing to take their place. How many ex-Woolworths stores are sitting empty? On our patch, none that I can think of, and most are now occupied by one of the pound shop chains that have taken up that gap in the market. Likewise, when smaller units have been shed by the banks, bookmakers and other now largely online businesses, we always seem to be able to find someone to take their place. Covenant strength clearly differs, and that is bringing about a shift. The aforementioned commentary relates mainly to lettings, but the profile of freehold buyers is certainly beginning to differ. Professional investors are no longer climbing over one another to buy any old High Street freehold. Their acquisitions are more targeted – affluent towns, or prime spots to allow for future shrinkage in the wider retail parades. Instead we’re seeing lots more interest from smaller or private investors. Some are recycling cash generated from the sale of residential buy-to-let portfolios (George Osborne burst that bubble), whilst others have an eye on owner-occupation. Regardless, this is further proof that the market is constantly changing, but in order to ensure it’s a forward change, we have to make it, not follow it! Our in-house financial services team writes commercial mortgages for an increasing number of clients, and in this Update you’ll read about several transactions involving business relocations and sales to owner-occupiers.
As I (belatedly) write, interest rates have just been increased, and many in the industry (myself included) are working when they’d normally be on a long holiday. There’s no connection between the two, but I’m clearly not the only one that thinks hard work is required to make the very best of 2018.
If you have a property to sell or let, or if you are planning to relocate your business, please get in touch.
NUTS ABOUT SWANLEY!
Following hot on the heels of our new Plumstead High Street and Plumstead Common branches, we opened our latest residential agency office in Swanley in May 2018.
Swanley is a key location in North West Kent benefiting from a dense population, good transport links and busy centre. Rachel Murphy is the Branch Manager, so if you have a property to sell or let in Swanley please call Rachel on 020 3861 0222 or email rachel.murphy@acorn.ltd.uk.
The Swanley branch is our 31st, but won’t be our last. We’re absolutely committed to proper estate agency that involves real life experts based in local High Streets. Watch this space for more new branches in 2018... 1 Sherman Road, Bromley, Kent BR1 3JH 020 8315 5454
120 Bermondsey Street, London SE1 3TX 020 7089 6555
acorncommercial.co.uk commercial@acorn.ltd.uk
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SOUTH NORWOOD SE25 In spite of an undoubtedly challenging residential market, freehold sites with full planning permission for residential development continue to prove popular. Help to Buy is clearly a key driver, with first time buyers understandably attracted to new homes, and developers competing for the opportunity to build qualifying product as a result. Residential values closer to Central London have increased considerably over the last 5 years, and in order to buy (or build) new homes under the £600,000 threshold interest has refocused on the outer London Boroughs, including Croydon. We sold an 8 unit site in Dennett Road at a strong premium in the first quarter of 2018, and followed that with the sale of a 9 unit site in Holmesdale Road in the second quarter. This particular sale was made on behalf of a developer client that hadn’t completed it’s purchase; proving that opportunities do still exist to add value without necessarily taking full ownership. Trading the contract in this case was key given the penal SDLT rates levied on the sale of residential properties acquired by professional buyers.
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Whilst the market for sites isn’t as strong as it was 24 months ago, in-depth market knowledge and the comparable evidence generated by one of the largest new homes agencies in London leaves us perfectly placed to drive premium prices from sites with planning permission. Please get in touch if you have a site to sell.
Existing Site
RAYNES PARK SW20
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Vacant freehold public house with planning consent for a 21 bedroom hotel.
CHARLTON SE7
Period property and detached coach house with consent for 4 units and possible further potential (stpp).
1 Sherman Road, Bromley, Kent BR1 3JH 020 8315 5454
120 Bermondsey Street, London SE1 3TX 020 7089 6555
acorncommercial.co.uk commercial@acorn.ltd.uk
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LONDON BRIDGE SE1 Bermondsey Street was recently voted one of London’s top 10 most sought after addresses, and with that in mind freehold properties are particularly hard to come by. We had advised both the freeholder, and longstanding commercial tenant of a building just three doors from our own offices over a number of years. The property comprises a small ground floor A1 unit, with an attractive 2 bedroom apartment in the upper parts. When our London Bridge investment team caught wind that the owner of the property was minded to sell, and that another local agent was pushing a buyer at £1.1m, we just had to step in! In the current climate, market knowledge is essential in achieving the best price. We knew that the property would be sought-after, the tenant would agree a surrender and that a high profile local marketing campaign would generate lots of interest. We were duly instructed, and within a matter of weeks were in receipt of numerous offers. We ultimately concluded a sale to a local investor at £1.25m; believed to represent a local record for mixed-use property in the area, and a staggering £/sqft rate of £1,132 (almost as much as pure residential achieves!) Subsequently, and as we expected, the buyer agreed a surrender of the commercial lease, and now has possession of the entire building.
If you own something similar, or simply have property locally that you want to sell, we have a proven track record of maximising value!
BATTERSEA SW11 As much as we’re kept very busy by our professional clients, it’s always satisfying to manage a sale for a private client; particularly when that disposal will bring about a major change in personal circumstances.
We were called in to appraise this mixed-use freehold by the owner in late 2017. Having owned the property for more than 40 years and secured planning permission in order to maximise value, the seller had been let down by a local High Street agent with several abortive sales. An expert approach was required, and after the relative shock of some forthright valuation advice had subsided (why do agents over-value properties!?!) we were engaged to manage the sale. A typically high profile campaign was launched, and the property, which had consent for the creation of three flats over a split level commercial unit, proved very popular. Our block viewings were well-attended, and a host of offers were generated. The ultimate buyer exchanged contracts and completed simultaneously, leaving us with a suitably happy (and now retired) client. Our client said ‘Thanks for the energetic marketing campaign… it paid off in locating the buyer for Lavender Hill. Well done!’ - Alastair Davidson
1 Sherman Road, Bromley, Kent BR1 3JH 020 8315 5454
120 Bermondsey Street, London SE1 3TX 020 7089 6555
If you have a freehold property to sell, regardless of its location, condition or potential, please get in touch with one of our offices. We’re always happy to offer some friendly advice either in person or over the telephone.
acorncommercial.co.uk commercial@acorn.ltd.uk
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BROCKLEY SE4 Even after a long and successful trading history, a premises is often the most valuable asset that a business controls. With this in mind we take particular pleasure from assisting business owners that may be retiring or relocating. We’ve known Wally & Marc of Walter Saunders Solicitors for many years, so when we were asked to sell their former offices we were determined to push the value as hard as possible. The four storey building close to Brockley Cross has A2 (professional services) use, and extends to approximately 1,500 sqft in all.
Guiding at £550,000 we undertook our usual high profile marketing campaign. Multiple enquiries were generated from our extensive database, and several busy block viewings were held. We’re great believers in the power of boards, and in this case our prominent ‘for sale’ made all the difference – it was spotted by a neighbouring shopkeeper and keen to acquire another property in the parade, he was willing to pay more than anyone else for the privilege. A deal was agreed comfortably ahead of the guide price, and completion of the sale took place inside 4 weeks. We always have buyers on our books for mixed-use and commercial freeholds, so please get in touch for a free valuation.
BROMLEY BR1 Clearly social media has changed the habits of the vast majority of the population over the last decade, but it has only made a notable impact on our business in the last 12 months or so. We’ve been using Twitter as a convenient conduit to update the news feed on our website for many years, but our Facebook & Instagram accounts are relatively new. Brand awareness, being part of a larger group and having relatively young staff have all undoubtedly helped build our social network very quickly, and we’re already reaping the rewards. Forward-thinking and media savvy PR agency, Orangedoor, found our Facebook page whilst looking online for an agent to help them source bigger offices in Bromley. We duly provided appraisal advice for their premises in Palace Road, and mentioned new offices that we were marketing in Scotts Road; less than half a mile away.
1 Sherman Road, Bromley, Kent BR1 3JH 020 8315 5454
Our client said ‘Quite a superb service and very professional. I would have no reservation about recommending Tony and Acorn Commercial in the future.’ - Walter Saunders
Orangedoor moved quickly to secure two adjoining office suites in the new development, and once contracts had exchanged, instructed us to dispose of their surplus space. We were delighted to achieve a premium over the guide for the former offices, and are hugely impressed with the character that Orangedoor’s fit-out has brought to their new HQ.
The Orangedoor team are a great bunch, and as gratitude for our efforts presented Adam Hosking with some new books for the library that we’re building at St Saviour’s School in Lewisham. If you’re reading the electronic version of this Update, the links to our social media pages and Orangedoor’s website are as follows (if you’re not, I’m sure Google will assist!)… @Acorncommercial
Acorn Commercial
Acorn Commercial
Acorncommercial
www.weareorangedoor.com
120 Bermondsey Street, London SE1 3TX 020 7089 6555
acorncommercial.co.uk commercial@acorn.ltd.uk
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IN A NUTSHELL CHISLEHURST
FOREST HILL
Attractive retail unit with residential upper parts on the ever popular Royal Parade. Offered to let on flexible lease terms; an agreement was quickly concluded with boutique charity shop Ada & Albert.
Attractive freehold investment close to Forest Hill Station comprising £14,000 pa income from a deli, and ground rent income from the residential uppers. Sold to a private investor for £190,000 (7% NIY).
BR7
LOUGHBOROUGH JUNCTION SE24 Industrial unit approx. 2,615 sqft forming part of a wider site under promotion for development. Let on a short term basis at £20,000 pax to mitigate rating and security costs. In essence, money for nothing!
LEWISHAM SE13
1 Sherman Road, Bromley, Kent BR1 3JH 020 8315 5454
SE23
HERNE HILL SE24 Vacant former scrapyard with longer term development potential. Let on a short term basis to a PLC company at £30,000 pax. Another letting to avoid rating and security costs during a planning application.
LOCKSBOTTOM BR6
Prominent retail unit approximately 770 sqft close to Ladywell Station. Let on a new FRI lease at an initial rent of £20,000 pax to a well-established chain of funeral homes.
Having relocated Langford Russell Estate Agents into bigger, better premises in Locksbottom, we assigned the lease on the old offices to a local interior design firm. We’re experts in business relocation – call for advice.
FOREST HILL SE23
PECKHAM SE15
Split level light industrial unit on the popular Malham Road estate. Approx. 3,000 sqft, let on a new 10 year lease at £32,500 pax (£10.83 sqft) to a local glass and glazing contractors.
Three bedroom, first floor maisonette with garage and garden, let on an AST, but held on a lease with only 50 years unexpired. Sold promptly to a cash buyer prior to auction.
120 Bermondsey Street, London SE1 3TX 020 7089 6555
acorncommercial.co.uk commercial@acorn.ltd.uk
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MEET THE TEAM
Adam Hosking Associate
Jeff East Director
Tom Luck Director
Tony Wood Projects Manager
Steven Flannighan Projects Co-ordinator
Louis Markham Projects Assistant
Jamie Stevenson Projects Assistant
Alan Glynn Projects Assistant
Could This Be You? If you are interested in joining our team, please send your CV to lily.whitby@acorn.ltd.uk
Lily Whitby Senior Secretary
Emma Cramer Team Secretary
Rosie Davis Team Secretary
OUR HOTSPOT SIDCUP We’re big fans of Sidcup. Despite having a busier High Street and better rail links, Sidcup has long been the poor relation to neighbouring Chislehurst and Bexley.
We’ve completed a lot of business in the town including the introduction of Travelodge, Waitrose, Costa, Premier Inn, Kaspas and countless residential developments. So, good shopping, good transport links, good schools, big name operators, two internationally renowned dance schools and value for money in its property stock; all Sidcup needs is an Acorn office!
1 Sherman Road, Bromley, Kent BR1 3JH 020 8315 5454
120 Bermondsey Street, London SE1 3TX 020 7089 6555
acorncommercial.co.uk commercial@acorn.ltd.uk
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READING IS MY SUPERPOWER call for unwanted books Have you heard? We’re building a brand new library for St. Saviour’s Primary School in Lewisham, to help pupils develop a life-long love of reading! Have your children grown out of the books they once adored? Do they now sit unused and collecting dust? Why not have a clear-out and donate them to St. Saviour’s new library?! Please drop off any pre-loved books suitable for 4-11 year olds to your local Acorn Group office, and together we can ensure that the pupils of St Saviour’s can enjoy a fully stocked library, ready for their return in September! Alternatively, if you would like to make a donation towards new books, please contact emma.fox@acorngroup.ltd.uk. Follow us for updates on this project and many others: @AcornGroup /AcornEstateAgency
1 Sherman Road, Bromley, Kent BR1 3JH 020 8315 5454
120 Bermondsey Street, London SE1 3TX 020 7089 6555
acorncommercial.co.uk commercial@acorn.ltd.uk
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