Gibralter offers a solid rock of business for Chesterton


gibraltar The relatively slow growth of most


international networks isn’t the result of regulatory issues, or lack of speed getting offices on stream, it’s the result of agents’ caution and unwillingness to run the risk of over-expansion or of opening a business that doesn’t reflect well on the brand. Andrew Hawkins says, “You can make a mistake trying to do too much too soon.” He wants to ensure that current offices are operating well before opening more. Because agents are opening up in


partnership with local agents for the most part and generally employing local agents even when they open wholly owned businesses, local issues are rarely a problem. But none the less, agents need to be careful to ensure they understand the way the local market works. Bill Siegle, for instance, warns that different accounting procedures used in other countries can sometimes conceal ‘black holes’; due diligence needs to be carried out thoroughly. “You’ve got to be prepared to adapt,” he says; “you can’t be too precious about it. You have to operate in their world, not yours.” Andrew Hawkins also believes that,


“As a UK based firm you need to listen to what your partners are telling you.” While it’s possible to expand in the UK market with a rigid attitude to business procedures and policies, expanding into foreign markets requires a rather more pragmatic and flexible attitude.


50 JUNE 2010 PROPERTYdrum


The core Western European markets are always of interest, as the vast majority of our buyers currently come from Europe.” aNDreW haWKINs ChesTerToN


Where shall We go? While the trend to expansion abroad is clear, agents are highly selective about which markets they move into. Andrew Hawkins says that for Chesterton, “The core Western European markets are always of interest, as the vast majority of our buyers currently come from Europe. Demand is showing us that these are the destinations we need to be offering.” So Chestertons has offices in Gibraltar, Mallorca, and Italy, as well as Russia. Hawkins says Chesterton would


consider America, but it’s somewhere that “an opportunity hasn’t come our way yet”. He has his eyes fixed on Asia, an area where he believes there will be growth. Fine & Country’s expansion strategy has


been driven by turnover, for instance by UK demand for Spanish and Middle East properties (Fine & Country is expecting to increase its presence in Spain in the immediate future). Mike Bidwell says “We’ve tended to grow into areas which have a natural synergy with the UK.” However he is also interested in markets


like the Far East, where there’s currently less UK investment but which in the long term will see higher growth. Closer to home, he likes the look of Spain, Russia, and the Czech Republic, as well as India – “fascinating markets with some absolutely phenomenal quality property.” His question before investing in a new market is whether the market is large


enough to enable the agency to make a living and pay a reasonable licence fee to Fine & Country. That means some smaller markets might not qualify. But he says “The beauty of the internet is that it’s easy to measure whether there is a market there in the first place, before we get on the plane.” It’s not always a simple decision. For


instance although France is a major market for British buyers of overseas property, Fine & Country has not got involved so far. Bidwell says that’s because he feels it is simply too large a market to manage on an office-by-office basis. “We have spoken to agencies in specific locations,” he says, “but we would be more comfortable finding a French realtor that had the ability to take on the master licence. We really, really don’t want to get it wrong – our brand is built on our strong reputation.” The common feature of almost all agents


who are expanding abroad, as opposed to simply selling overseas property into the UK, is that they’re concentrating on high end properties over EUR 1m in value. For instance according to Mike Bidwell, Fine & Country concentrates on the top quarter of the market, with a EUR 2-3m valuation typical. Partners, obviously, need to be comfortable dealing with this quality of property. Bill Siegle, too, says “Our involvement has generally been only at the top end of the market, with prestige properties.”


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