This week started with relief that the nation hadn’t gone entirely crazy and voted rogue MP and former health secretary Matt Hancock winner of ITV show I’m a Celebrity… Get Me Out of Here! Instead, Lioness Jill Scott picked up the crown.
Meanwhile, England’s 3-0 win over Wales means they have made it through to the final 16 in the men’s FIFA World Cup. More than ever, the tournament has highlighted big divides between winners and losers both on and off the pitch, even spilling into our industry, as our cover story attests.
In property generally, winners and losers have also been coming to light this week. While confirming the revaluation of properties in the Autumn Statement, chancellor Jeremy Hunt added that the business rate multiplier would be frozen in 2023-24. These changes to how business rates are calculated mean the tax burden on many retailers is likely to fall next year, causing celebrations on the high street. The largest stores will save the most, with rateable values down by 34.7% on average, according to Altus.
On the flip side, rents and rental values for industrial and logistics have gone through the roof, meaning occupiers and landlords are looking at substantial increases in their business rates. According to Colliers, the average increase in rental valuations and, therefore, business rates coming down the line for the losers is 27%.
There were losers elsewhere, in retail, as AEW Research’s 2023 European Annual Outlook report predicted annual total UK retail sales for 2022 will slow by 4.5% to £443bn, with the economic slowdown and inflation weighing on households’ purchasing power. Lockdowns and closings had already hit prime high-street retail and shopping-centre rents hard in 2020, with 16% and 20% rental declines respectively.
Columnist Alastair Stewart refers to yet more losers, stating the traditional festive slowdown among buyers has started significantly earlier this year with Zoopla’s most recent data showing a 28% fall in sales volume last month compared with November 2021. Housebuilders’ trading updates also signal troubles ahead with sales and cancellations rates telling a worrying tale.
But hope is not lost for all. Fergus Keane, head of central London investment markets at BNP Paribas Real Estate, predicts there will be winners as overseas investors who aren’t already deep in negotiations are circling London seeking price adjustments and waiting to strike.
Yet more winners can be found in the student sector, which looks like it is booming, as record numbers of students aspire to study at UK universities and 2.39 of them compete for each available bed. Richard Skeels, chief executive of CRM Students, tells PW: “We currently have more 18- to 21-year-olds as a population than for some time, so demand has increased.”
Much like England on Tuesday, the property sector’s fortunes will rest on its ability to skip past some difficult challenges and show creativity and flair. Outcomes might depend which side you are on and, ultimately, as in sport, you are only as good as your last result.