How many times this week have we heard commentators call on the West to meet force with force, as that is all Vladimir Putin understands?

Liz Hamson leader

Liz Hamson, editor

The mobilisation of armies is one thing, though. The impact of imposing heavier sanctions on Russia, as many are demanding, is quite another. Russian politicians reacted to the preliminary volley of sanctions from the US and the UK with shrugs of indifference, verging on contempt. Sanctions are nothing new, was the message. That may be so, but not imposing heavier sanctions could well be seen by Putin as an act of capitulation akin to rolling out the red carpet.

As Property Week went to press on Wednesday, the Ukrainian government had told its citizens to leave Russia immediately and brace themselves for imminent invasion. Meanwhile, as well as promising to give Ukraine military support, Boris Johnson froze the assets of five Russian banks and three billionaires with links to the Kremlin, promising further sanctions.

If we are, as some fear, on the brink of World War III, he is going to need to go a lot further than that on the sanctions front. The question is: will he – and what might it all mean for the property industry?

Earlier this week, senior industry figures remained strangely muted in their response to the escalating crisis. ‘Guarded’ is the word I would use to describe the remarks of most of those I spoke to or heard from. That is if they were prepared to pass comment at all – forget a flurry of emails, it was more like a flutter.

In people’s defence, it is hard to comment on such a fast-moving story, especially before the full scope of any sanctions is known, but there are some less palatable reasons for their reticence.

The ugly truth is that it is not just the Tory Party that has accepted huge donations from Russia. Large swathes of the property industry have benefited from Russian money, too, particularly in London. As we report in our cover story, the latest statistics from Transparency International (TI) suggest that since 2016, £1.5bn worth of UK real estate has been bought by Russians accused of corruption or links with the Kremlin. Of this, nearly £430m worth (28.3%) is in the City of Westminster, while £283m (18.8%) is in Kensington and Chelsea. Some £830m worth (55%) is held by companies in Britain’s overseas territories and crown dependencies. That’s quite a bit of Russian skin in the UK property game.

So, what should the industry do? What can it do? For one, it can stop turning a blind eye to dodgy Russian money, which, admittedly, is easier said than done when that might be the only investment on the table, but needs to be done nonetheless, because make no mistake, the government will lay the blame at the industry’s door rather than accept any responsibility itself if push comes to shove. For another, it needs to demonstrate that it can robustly police itself or run the risk of further and much more stringent regulation, if that isn’t already in the pipeline.

The potential repercussions of the escalating crisis are gravest of all for the Ukrainian people, of course, but there could be other losers in Putin’s game of Russian roulette with the West over Ukraine. If the government does introduce measures to force overseas companies holding UK property to reveal their owners, it would not be a good look if the property industry was found to be overly dependent on Russian money, not a good look at all.