MARKET TRADER, MAY 10 - 23, 2019

should help to relieve financial pressures in the short term. Regeneration initiatives are

being put to work in the major UK cities Greater Manchester has

an ambitious long-term development plan, aiming to deliver nearly 25 percent of the total target of new homes in Greater Manchester and a significant proportion of office space within the city centre

between now and 2037. Regeneration in the city

centre is expected to have a beneficial impact on the surrounding town centres in Greater Manchester’s boroughs – Bolton, Bury, Oldham, Wigan and Salford – allowing for a potentially diverse mix of investment propositions. In Birmingham, a public/ private partnership between

the ci ty counci l and regeneration specialists is planning to transform a 43 acre site in a neglected area of the city, Icknield Port Loop, bringing 1,150 new homes, office and retail space, parks and leisure facilities. Elsewhere, a £300m regeneration plan has been approved for a 112 hectare site in the Royal Docks Enterprise Zone in London, with the aim of creating 35,000 jobs and 4,000 new homes. While the stimulus for

Urban regeneration is set to be a significant area of policy focus for the Government (Photo: Max Nathan)

regeneration is coming forward, what about the demand? Affordability remains a significant hurdle for many homebuyers. The lack of housing supply, tighter credit conditions and high levels of valuations relative to incomes (despite modest wage gains in recent months) continue to present barriers for prospective buyers, especially those at the start of the ladder. All of these factors are increasing the attractiveness of the private rental market and so institutional investment in this area is growing strongly, especially as private buy-to- let investors leave the market. According to CBRE, £2.1bn of institutional capital was invested into UK real estate between Q4 2017 and Q3 2018, a rise of more than 50 percent from the previous 12 months. The rental market is still

considered to be supply constrained and there is opportunity for further growth. Private rentals, for example, are becoming a lifestyle choice for the older generation, as shown by the growing popularity of build-to-rent retirement living. According to the Centre for Ageing Better, the number of older people renting rose to 414,000 in 2017 from 254,000 in 2007. It is estimated that up to one-third of those over the age of 60 could be living in private rented accommodation by 2040. More broadly, in the

so-called ‘beds’ sectors – student accommodation, hotels and healthcare – demand remains strong. Healthcare in particular is more defensive and should be less exposed to any pol i tical and economic turbulence. It should therefore continue to benefit from new investment, especially as new technologies drive changes in how healthcare services are delivered. In other sectors, too, lifestyle

changes brought about by technological innovations may have the potential to transform UK town centres. Demand for flexible working space surged in 2018, with the ‘co-working revolution’ showing meaningful traction in the South East and regional cities, and further expansion is expected in 2019. According to CBRE, demand for flexible working


Nobody wants to see this (Photo: William)

space is significantly above its five-year average – more than 50 percent in London; more than 100 percent in regional cities; and more than 150 percent in the South East. Supporting regeneration through alternative lending Over the past couple of

years, capital appreciation opportunities have dimin- ished across commercial and residential property sectors. With this in mind, and given the expectation that re-devel- opment of the underperform- ing retail space will become more common in 2019, what is the most efficient way to access this market? As traditional lenders

have stepped back from property lending over the last ten years, this has opened opportunities for alternative financing through the asset- backed loans market. These

types of investment vehicles, with investments secured against the underlying assets, are considered to be a more efficient and stable route to access the property market versus buy-to-let or traditional equity funds. Asset-backed loans also

offer attractive net yields for the risk taken relative to UK government and higher quality corporate bonds. The prospect of re-shaping

the UK high street for 21st century needs should be viewed as an emerging and growing market opportunity. While being able to take advantage of development finance opportunities, real estate investors also have the potential to be part of the movement to transform UK town centres and bring wider social, economic and environmental benefits.


At CASTLE COMBE RACE CIRCUIT, WILTSHIRE SN14 7EY. 18th & 19th MAY 2019 ENTRIES FROM TRADE STANDS and STALLHOLDERS WELCOME This is a long established event and is looking to increase the Trade Stand area. Hard standing and grass pitches available, good hard access to Site. The Site has a Permanent Bar, Catering and Toilet Facilities. NEW EXHIBITORS ALSO WELCOME!

Contact: Mr D Marsh 01454 294 117 @castlecombesteamrally

@cc_steamrally castlecombesteamrally


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