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Commercial buildings: “It’s all about value, not cost”

(Image: Sunny Landa, director at NG Chartered Surveyors)

It’s not often you’ll hear a commercial property agent quoting Oscar Wilde, but there is rarely a greater truism than the playwright’s famous “Nowadays people know the price of everything and the value of nothing”.

Wilde spoke these words in 19th Century, but the sentiment remains – especially in the commercial property sector in Nottingham.

For some time now there has been a growing trend amongst the local industry for undercutting of fees. Naturally, landlords are attracted to this, as it means they’ll get to keep a greater slice of the pie after their property is sold or let.

However, the practice of undercutting or lowering fees is not only ethically wrong, but also short-termism at its worst.

Landlords might be tempted down this cheaper route, but we’d ask: do you really think you’re getting value for money? There’s an old adage: ‘you get what you pay for’, and this is certainly true when it comes to instructing a commercial property agent to dispose or let your property.

If an agent is offering a landlord lower fees to try and entice them, the landlord should question who will be looking after the instruction? Will it be the seasoned, qualified property professional, or will it be a green graduate, eager but fresh out of university and woefully inexperienced in looking after a property portfolio. My experience tells me it’ll be the latter.

We’ve seen this is in the commercial property sector before; it usually happens when we’re coming out of recession and agents are battling it out to take advantage of a businesses who have a little more confidence in the economy and are looking to move premises.

This time, however, it’s a little different.

There has been such little speculative development in the last ten years that stock levels of good quality accommodation are incredibly low. Agents are fighting over instructions, and this is leading some to offer unsustainable rates.

While we can’t force developers to build offices and industrial units, as agents we mustn’t simply lower prices to maintain cashflow – that way lies madness, and sure fire way to devalue the industry and give it a bad name.

Surely it is better to offer a service that our fees warrant? At NG we don’t think about cost – we think about value. A landlord who is willing to pay the going rate to let or sell his or her property will get the best possible service. Can the same be said if s/he decided to take a chance on a cheaper alternative? I don’t think so.

At NG we pride ourselves on standing out from the crowd. We have a mantra of: “Our values decide our character; and our character decides our value”. Commercial property agents in Nottingham have a purpose of duty not to offer cheap alternatives which let down landlords (and ultimately occupiers), but to offer value on every instruction.

“Taking what we can get” can only lead to one outcome, and when we’re all in a desperate race to the bottom, not only does the image of our industry take a battering, but everyone loses out.
As Oscar Wilde also said: ‘Experience is one thing you can’t get for nothing’.

Written by Sunny Landa, director at NG Chartered Surveyors.
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COMPAC’s technological marble specified for Shanghai shopping mall

Versatility, functionality, longevity and beauty were key factors for leading architectural practice RTKL to specify COMPAC’s technological marble for a state of the art shopping mall in Shanghai.

The shopping mall is part of the largest multi- transportation hub in the world integrating Hongqiao airport –Shanghai’s second international airport with high speed rail, metro stations and road networks.

COMPAC’s high performance technological marble in the distinguished Nacarado design was specified for over 9,000 sq metres of flooring to provide a cool to the touch hardwearing surface.

RTKL specified 600×600mm and 600×900mm tile formats each with a 20mm thickness to produce a stunning, modern contemporary look which perfectly complemented the aesthetic requirements of the building.

COMPAC have been able to create ‘technological marble’- an engineered stone composite which has the look and feel of natural marble but with properties that eradicate many of the problems associated with it.

Containing up to 96% natural marble mixed with resins, COMPAC’s technological marble has a hardness that is similar to marble but its resistance to impact and breakage is much greater owing to its enhanced flexibility.

COMPAC’s technological marble can also be polished, thus maintaining its shine and original appearance for much longer.

It can be used on kitchen and bathroom floors, walls, vanity tops, building façades, and staircases and on high footfall surfaces such as airports, shopping malls and public buildings.

For more information please visit www.compac.es.
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A new Apple campus at Battersea Power Station redevelopment

Battersea Power Station has now confirmed that Apple has agreed to lease office space within the historic Battersea Power Station.

Apple will be the largest office tenant at Battersea Power Station occupying approximately 500,000 sqft., across 6 floors of the central Boiler House inside the historic icon. Apple is expected to move into the Power Station in 2021.

Battersea Power Station will be Apple’s new London campus and its office will account for circa 40% of the total office space in the whole development.

Apple has today said it is looking forward to opening its new London campus at Battersea Power Station in 2021. 1400 Apple employees from existing offices around London will relocate to this magnificent new development at one of London’s best known landmarks. Apple has added, that this is a great opportunity to have its entire team working and collaborating in one location while supporting the renovation of a neighbourhood rich with history.

Dato’ Johan Ariffin, Chairman of Battersea Holding Company Limited, said “We are delighted to welcome Apple, the world’s most valuable brand, to Battersea Power Station, London’s most iconic development. This move by a brand of such calibre will serve to generate even more interest in Battersea with its vibrant mix of commercial, exciting retail and residential offerings in a cultural setting designed to drive innovation and enterprise. Apple can only strengthen this formula for success.”

Rob Tincknell, CEO of Battersea Power Station Development Company added: “We are delighted that Apple has chosen to make Battersea Power Station its home in 2021. It is testament to our fantastic building and the wider regeneration of the 42-acre site which offers a carefully curated mix of homes, businesses and leisure amidst extraordinary open spaces and new transport links. It has always been our clear objective to create one of London’s most thriving new communities and this commitment from Apple will undoubtedly help us achieve our goal.”

Sadiq Khan, Mayor of London commented: “I am delighted that Apple is moving into Battersea Power Station‎, helping to generate new jobs and economic prosperity for Londoners. It is a further sign that London is open to the biggest brands in the world and the leading city for trade and investment.”

Cllr Ravi Govindia, Leader of the London Borough of Wandsworth said: “I’m very pleased to give Apple a warm welcome to the London Borough of Wandsworth. Apple will become the largest employer in the Borough and we are hugely excited that they will play a keen and active role in our local community.”

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Government must act now to prevent significant real estate downturn, says BPF

The British Property Federation (BPF) today called on government to consider a raft of policy measures to support real estate, following the publication of a RICS report showing a significant decline in confidence, activity and investor interest in UK commercial real estate.

The RICS UK Commercial Property Market Survey for Q2 2016 showed that investment demand for commercial real estate has fallen sharply and that, although some immediate turbulence was to be expected following the EU referendum, the sector may in fact face a far more significant downturn. The BPF urged government to monitor the situation closely and consider introducing a package of support for the real estate sector, including:

  • Accelerate its proposed reform of business rates to support activity in the broader business economy
  • Delay the introduction of plans to restrict the tax deductibility of corporate interest expense for a year until 2018, to ensure that the rules are implemented in a way that doesn’t deter investment
  • Introduce a range of tax reliefs for build to rent development, including CIL relief, relief for modular construction, and SDLT relief for new build to rent developments on the condition that they will be let on tenancies of three years or longer with rent increases tied to inflation
  • Maintain an absolute and continued commitment to devolution and public infrastructure investment in HS2, the East-West Rail Line, Crossrail 2, and an imperative decision on growing airport capacity.

Ian Fletcher, Director of Policy (Real Estate) at the BPF, said “This is not the time for knee-jerk reactions, but commercial property and a number of the government’s priorities are interdependent. Ministers must closely monitor developments in the commercial property market and be ready to act in weeks, not months, if evidence continues of a slowdown in investment.

“Commercial property investment is not always an obvious priority for governments because its social and economic impacts are indirect, but construction and development activity flow from it, ultimately impacting on jobs and economic growth. In scenarios like this the focus is often on construction, but you don’t get construction without an investment client, so it is essential that government monitors fluctuations in investment very closely.”

The full results of the RICS UK Commercial Property Market Survey can be found here.
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Commercial & retail construction at its strongest for more than four years

The total value for commercial & retail construction contracts in August were worth more than £1.5 billion, the highest in over four years, based on a three month rolling average.

According to the latest Economic & Construction Market Review from Barbour ABI, it was a busy August for the commercial & retail sector but in particular office construction, which dominated the sector for the month with 84 per cent of the total value of contracts awarded.

To put the growth of commercial & retail contract values into perspective, the last three months have each had more than double the value when compared to that in May. August also experienced an increase of more than 70 per cent when compared to the same month last year.

London led all regions with over 60 per cent of the total amount of commercial & retail contract values in August, including eight of the top ten biggest projects. Contracts for major office developments were finalised including the £150m Park Place development in Canary Wharf and the £100m Marble Arch project in Westminster.

Commenting on the figures, Michael Dall, lead economist at Barbour ABI, said “After an unstable start to the year, commercial & retail construction has picked up dramatically to the point where August has been the strongest month for more than four years.”

“It’s not surprising to see London dominating the sector once again. As a global city, we’re seeing more and more demand for office space in the capital, hence the massive projects awarded contracts this month. Even with the recent spike in office construction work being put on hold, this isn’t putting off investors rolling the dice with new projects looking towards the future and the potential gains to be made from London property.”

“Over the last three months and in particular August, demonstrates that there is a major demand for office space and willingness from investors to spend and commit to new projects. The long term growth for this sector is looking positive, and when commercial & retail is strong it can often be a sign that the economy as a whole is performing well.”

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Spectus Systems launches new ‘responsive’ website

Spectus Systems is inviting everyone to take a look at its brand new website after it has undergone a complete redesign with three core priorities: functionality, aesthetics and ease-of-use across a range of devices.

The aim from the outset was to provide a better experience for professional, trade and homeowner visitors whilst encouraging greater engagement and delivering a mix of product information, industry news and useful features.

Easy navigation is vital with users now demanding a great experience when accessing any website and dismissive of any that do not perform. Basics such as drop-down menus on the new Spectus site are therefore well researched and designed to be clear, simple and tailored to different users’ needs. The site also includes a search facility with results listed in a scroll-through format. The overall appearance is clean, fresh and uncluttered.

Developed for the connected world in which mobile Internet users now outnumber those accessing via static devices, the site is fully responsive and works with all iOS and Android operating systems. Users can therefore access the information they need on tablets or using smartphones whilst on the go, without compromising their experience. Fabricators and installers especially will benefit from the comprehensive information and excellent imagery included in the site’s Technical Hub and architects and specifiers will find a wealth of useful features, including NBS access and BIM objects.

The Media Centre provides industry news, opinion pieces, Spectus case studies and video content with regular updates addressing topical and emerging issues. Links to social media sites are included for a broader visitor experience and to promote engagement, all within a single source.

Commenting on the new site, Carmen Velilla, Spectus Brand Manager said “We are delighted with the new website. It’s achieved our aim of providing a simple, relevant and practical source of information and interaction. It looks great, too, and we believe visitors will love the change.”

Please visit www.spectus.co.uk to take a look!

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