I am both not surprised and surprised by the number of businesses that seem to be attending Mipim this March.
Not surprised, because everyone naturally wants to press the ‘reset’ button and get back to normal, and for many Mipim has been a seminal event in their calendar for decades. Surprised, because many of those businesses had been stating for a while that Mipim had had its day and could no longer be justified, particularly as bigger corporates feel the need to be pushing the ESG agenda, so flying hordes of staff to meet clients who are often a walk away in London is tricky to justify.
The property industry is hard-wired to promote its own resilience and shrug off risks. Harbingers of doom, tortured from ‘knowing too much’, soon lose their invitation to Mipim lunches and are left to skulk in the shadows of Bar Roma, nursing a lukewarm drink, feeling like the ancient Greek priestess Cassandra (blessed with the gift of prophesy, but cursed by no one listening to her). Netflix movie Don’t Look Up plays on this trope too, albeit with a rather more apocalyptic outcome being peddled by its ‘Cassandras’!
The property industry is hard-wired to promote its own resilience and shrug off risks
So, what might be gnawing away in a Cassandra’s mind at Cannes this year – if only someone would buy her another glass of rosé and listen? Well, up steps ingénue Ian, mustard keen to impress at his first Mipim. He staggers away two hours later, rather more sober, having heard a diatribe about:
- The years it will take for the post-Covid live/work balance to give a real picture of how and where people will live;
- Build costs and skills shortages really are spiralling out of control;
- Interest rates are only going one way;
- Household finances are getting hugely squeezed;
- The Tory party’s much-vaunted plans to radically shake up the planning process have been kicked so far into the long grass that no one will be able to find them;
- The scary reliance in the London new-build market on mainland Chinese investors buying high-rise projects off-plan, three years prior to completion. If only they would realise president Xi is likely to flick a switch in Beijing that ends that party overnight;
- The tens of billions that funds have raised and promised to spend wisely in the BTR arena that are being squandered and compromised on lazy investments in the wrong product in the wrong location, because there is far more money than stock for them to buy where they should be; and
- That this same wall of money is artificially propping up land values, as developers pivot to simply becoming development managers, milking fees to prop up their lifestyles without any real prospect of turning a real profit.
Ian gratefully falls in with a jollier crowd that are heading down the Croisette and ‘pushing through to dawn’, as they are celebrating just being appointed on a new 2,000-unit high-rise project in the Docklands! Sling on your rosé-tinted Ray-Bans and get down to Cannes!
Another musing: many readers will remember the mayor of London’s much-cited response when campaigning and early in his reign, when asked about his plans for accelerating housing delivery in the capital, that it was “a marathon, not a sprint”, which no one could refute. As a result of the 2020 lockdown delaying the election that gave him his second term, he was gifted an extra 12 months (so will serve for nine years). Enough, many would argue, to be well into that 26.2 miles. Time to peel that tracksuit off Mr Mayor!
Dominic Grace is an independent consultant