Maybe it was the weather. Warm sunshine bathed Mipim last week, sweeping away the industry’s gloom. The chatter in all my meetings was arrestingly upbeat – albeit with shades of that Monty Python song about the bright side of life.
On the opening morning, I shared coffee with Colin Godfrey, chief executive of warehouse owner Tritax Big Box, and Tritax Symmetry managing director Andrew Dickman, for an update on the industrial and logistics sector.
Godfrey glimpsed a silver lining in last year’s cloud of revaluations, saying the speed at which values fell in 2022 had put the sector in a pole position for a swift recovery in 2023, compared to the “death by a thousand cuts” undergone in the wake of the global financial crisis.
Dickman concurred, saying: “The impact on single assets has been very significant, but now sentiment is very good.”
Among other reasons for cheer, Godfrey said Brexit had given warehousing a backhanded boost by encouraging firms to hold more stock in the UK, while Dickman added that 2021’s Suez-canal blockage had brought a switch in strategy from “just in time to just in case”.
Godfrey credited Hamid Moghadam, chief executive and chair of rival Prologis, for quipping that occupier demand had gone “from 12 out of 10 to 10 out of 10” last year. Godfrey’s top tip for market-leading growth was in campus developments, where occupiers bring office, warehouse and production facilities together for greater in-house synergy.
Mark Dixon, chief executive of workspace specialist IWG, proved equally upbeat. “The office is most definitely not dead,” he told me, before adding: “There’s all this conversation going on – I’ve heard it today – that people are coming back to [their old] office. Absolute nonsense. They’re not coming into central offices, but are going into local [flex space] offices. We’re opening as many as we can.”
Sarah-Jane Osborne, head of workplace in the UK and Europe at Avison Young, also glimpsed a bright future for offices through a different lens: “Today’s work is supported well by remote working, tomorrow’s not so much,” she suggested, adding that working apart will have a slow, corrosive effect. “The immeasurable becomes measurable over time,” she warned. In her view, office owners should grab today’s lull to refurbish and retrofit for the future.
Tessa O’Neill, town planning director at architecture firm BDP, even managed to find warm words for the prospect of higher planning fees, which are the subject of a government consultation – though only if higher fees are firmly ringfenced to actually improve the professionalism of underfunded planning departments.
But the prize for the most upbeat analysis goes to Lord Dominic Johnson, minister of state at the Department for International Trade. During a Mipim Q&A with all the substance of candyfloss he said: “The British newspapers like to cast a bit of a pall over the economy. But the reality is the economy is actually doing very well.” This was delivered prior to the latest inflation figures, of course.
Lord Johnson also quipped he’d once asked: “Can you hear me at the back?” To which someone cried: “Yes, but I’ll gladly swap places with someone who can’t.”
I know the feeling. Alas, not all good news is necessarily the real thing.
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