British Land is struggling to sell luxury homes in central London, amid a slowdown in the market, the firm’s head of residential has said.
Speaking at the Movers & Shakers breakfast in London on Tuesday, Tim Roberts, British Land executive director and head of offices and residential, said while there was still demand at the very top of the market - the so-called ‘uber prime’ units of over £5,000/sq ft - sales of units a step below that price point had cooled.
The developer’s Hempel scheme in Bayswater, in particular, had been hit by the slowdown, he added.
“We’re struggling to sell in the prime market - volumes are down,” he said. “It’s an awkward market that has been hit by global uncertainty and stamp duty changes. Uber prime is softer than it was, but there is still a market out there.”
Roberts added that at the “value-for-money end” of the market - around £700-£1,000/sq ft - units were still selling, although the market had also “slowed”.
“Different markets have got different characteristics at the moment,” he said.
The comments are the latest sign of the cooling in London’s prime residential market, as a glut of new luxury apartments come up against falling demand as a result of regulatory changes, global economic uncertainty, the falling oil price and falls in Asian currencies.
Last week, Capco revealed that sales of apartments in its Lillie Square scheme in west London - which range between £600,000 and £6m - have stalled since November, with the developer citing “challenging conditions… as a result of increasing supply”.
Meanwhile, Roberts said that while the London office market had had a good start to the year the looming EU referendum would likely hit occupational demand. “Some people are going to pause for breath in the lead up to the referendum,” he said.
Also speaking at the event, Martin Jepson, president & chief operating officer of Brookfield Property Partners, European Offices Division, added: “Demand [in the office market] has remained surprisingly strong in the first few months of this year, but with the referendum coming up I think that will calm down now.”