Last year was a record year for property investment, according to the latest data from Gerald Eve. Not that the bigwigs in the industry needed to have their relentless optimism fuelled any further.
Any other industry would have been laid low by the pandemic. Not property. No matter what obstacle it faces, be it Brexit, the ‘death of retail’, Covid or the ‘death of the office’, this is an industry that can find a silver lining even in the darkest of clouds, that famously talks itself up and that will, however hard a hit it has taken, drag itself off the deck, dust itself down and state with 100% conviction, “we will bounce back”.
Since I joined the magazine three and a half years ago, large retailers have fallen like dominos. Mike Ashley’s House of Fraser first fell into administration in August 2018; intu went under in June 2020; and Arcadia succumbed in November 2020.
However, while the retail sector has had a mare and we have seen the rise and fall of the likes of WeWork (whose woes have raised major questions over the flexible workspace model), industrial has gone from strength to strength. We have even seen once sleepy SEGRO leapfrog the seemingly unassailable Landsec as the biggest propco in the UK, although under the expert guidance of Mark Allan, a rearguard action is already being mounted.
The industrial sector as a whole shows no signs of slowing down. Last year, sheds accounted for 25% of the £67.1bn invested in UK property, according to JLL. The sector also proved to be the most successful fundraiser last year, led by Tritax Big Box REIT, which raised £300m in October 2021. Tritax has kept up its momentum this year by forming a joint venture with abrdn to provide Britishvolt’s Northumberland Gigafactory with £1.7bn of funding.
Alternative sectors also continue to go great guns. Some have even arguably become mainstream. Take student accommodation, which is now attracting investment from some of the world’s largest finance firms and family offices. In this week’s issue, we reveal that Bricks Group and Tristan Capital are looking to establish a whopping £750m PBSA portfolio across the UK.
And don’t even get me started on the wider residential sector. UK housebuilders have not just survived the pandemic, they have thrived during it. Last year, the materials and labour shortage resulted in listed housebuilders’ shares slumping, but by the end of 2021 share prices had recovered dramatically – to end 10% up year on year – thanks to a raft of government support measures and the sheer level of pent-up demand.
I mentioned earlier that I had joined Property Week three and a half years ago because this is my final issue, which is why I’ve been given the customary opportunity to write the leader piece. It is a fascinating time for the industry as it emerges from the pandemic and investment and development are ramped up accordingly, and that’s why I’m sad to be leaving Property Week.
I am heading to The Telegraph, where I will be writing about all things business. I’ll be handing over the reins at Property Week to Rhodri Morgan, who starts next month. I hope you extend to him the same warm welcome and offer him the same amazing support as you did me.