PrimeResi Quarterly No.1 - preview pages

2014 NEWS
REVIEW
=
VIEWS &
OPINIONS
REFERENCE
BRIEFINGS
=
DEVELOPMENT
QUARTER
PROFILES &
INTERVIEWS
=
INTERIORS
& DESIGN
DEALS &
INSTRUCTIONS
=
PRIME SALES
DIGEST
PrimeQResi
J ournal of Prime Property
PRIMERESI.COM
NUMBER ONE Q Q1 2015

Publisher: Matt Crofton
matt@primeresi.com
Editor: Dan Crofton
dan@primeresi.com
Copy Editor: Anna Bastiaenen
Design Director: Guy de Boek
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Q
Foreword
In the three years since PrimeResi reported its very first story (about
a £22m stonker in Richmond, incidentally), the top end of the UK’s
residential property market has felt like an unsettled – and unsettling
– place to be.
Few sectors have faced a greater sustained threat of punitive policy
change.
As we saw in December with the “surprise” SDLT reforms, the fiscal
landscape can change at the drop of a hat. High-value buyers were given
exactly 11 hours and 29 minutes to avoid huge unbargained-for increases
in their tax bills for simply proceeding with their purchase; in some parts
of London, more homes ended up changing hands on that day than on
any other in the past decade.
Meanwhile, the Damoclean prospect of a mansion tax continues to
hang over the market – effectively stalling any meaningful activity until
we find out who’s going to be in charge of the country – and not a day
goes past without a news outlet gleefully prophesying a crash of catastrophic
proportions.
Dumas summed it up best in The Count of Monte Cristo; “uncertainty
is worse than all”.
Despite this, here still exists the most coveted, influential and exciting
residential property market on the planet. The homes and developments
designed and built in the UK today continue to raise the bar on the
international stage, whilst ruinously ambitious restoration projects have
brought some of the world’s finest historical buildings back from the very
brink.
The armies of prodigiously-talented craftspeople, architects, planners,
agents, builders, designers, developers, surveyors and marketeers responsible
may not always work in harmony, but judging by the results featured
in the following pages, they certainly do work very well together. It is one
of the few areas where artisan traders and family businesses go hand-inhand
with global behemoths, creating jobs and pioneering innovation.
To categorise the prime property market as one of empty excess is a
mistake; its importance and relevance runs right through the heart of the
economy and it should be treated with the utmost care.
Without wanting to overdo the Dumas: “All generalisations are dangerous,
even this one”.
We hope you enjoy reading this, the inaugural PrimeResi Quarterly.
Dan Crofton, Editor
Matt Crofton, Publisher

Contents
YEAR IN REVIEW
Business & People
A digest of the last year’s
top industry happenings
Portal Kombat
OnTheMarket’s launch,
Zoopla’s float & more
Deals & Instructions
A survey of the biggest and
most interesting sales and
acquisitions of the last year
THE MARKET
Crystal Balls
Prime property market
forecasts for the year ahead
Lonres Winter Review
A very informed view of
the London, national and
Paris markets
SDLT REFORM
Crib Sheet
Autumn Statement 2015
Talking Heads
Prime industry reactions
Rising Stamp
LCP surveys the new SDLT
landscape
SDLT & the prime
London market
Lonres / Dataloft analysis
14
24
28
10
308
280
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286
318
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NEWS NUGGETS
Growth Chart: 2014’s house
price hotspots
‘Most Expensive Streets in
England & Wales 2014’
Saint-Jean-Cap-Ferrat named
‘World’s Most Exclusive
Residential Address’
Pricey Comparison: The world’s
most unaffordable property
markets
Capital Exodus: Londoners
cash in on price chasm
Million-plus lettings surge
as HNW buyers wait and see
Global house price slowdown
continues as ‘engines of growth’
stall
The Return of the Russians:
Super-prime deals soar as vendors
cut prices
£105bn Chinese investment
will be ‘a game-changer’ for UK
real estate and infrastucture
Luxury projects put London at
the top of the global construction
cost league
Permitted Development
Rights fails to deliver as policy
deadline looms
Royal Burrow Ban: Council
declares victory in war on megabasements
TfL goes on the hunt for
development partners to turn
it into one of London’s great
estates
Chelsea Crossrail station ‘still on
track’ as safeguarding moves on
The rise of the seven-figure
market: £1m+ sales triple in
ten years
Luxury asset investments trump
prime property

73
OPINIONS
Talking Heads
Five prime resi pundits on
the real meaning of ‘luxury’
Trevor Abrahmsohn
i) Be Careful What You
Wish For: The reality of
a ‘dampened’ property
market
72
73
Will Hollest
When will HNWs finally
conclude that London’s not
worth it?
Tracy Kellett
Chinese Medicine:
The buying agent’s Surrey
culture clash
74
88
76
79
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86
ii) The Writing On The
Wall: Trevor’s Mansion Tax
Q&A
William Cash
Why ‘rural vandalism’
turned me to UKIP
Camilla Dell
The return of the buyers’
market?
Charlie Ellingworth
i) Development gambling,
the Oligarch’s Dilemma,
and the London-Country
inflection
ii) Balance of Tower: Why
London’s development boom
could ruin the capital
82
95
79
76
99
Chris Lanitis
Staying Ahead of the
Ripple: The importance of
opportunism
Alan Page
i) Feverish Pitch: The Doer
Upper’s agency ‘beauty’
parade
ii) Shabby-to-Chic: The
Kensington project, done up
Rachel Thompson
Special Advisors: What
makes a great buying agent?
Bob Weston
Why the UK property
industry needs to rethink its
definition of ‘prime resi’
81
91
94
85
70
95
Nathalie Hirst
On waiting for the top of
the market to thaw
86
The views of contributors are not
necessarily those of PrimeResi or
its publishers.
QUARTERLY SALES DIGEST
Q4’s £2m+ residential deals
As lodged with the Land Registry
320
All content is intended as guidance and/or entertainment only;
no action should be taken in reliance on it without specific professional advice.

PRIME MOVERS
Niccoló Barattieri di San Pietro
CEO, Northacre
154
280
REQUIRED READING
The Autumn Statement & SDLT
Mishcon de Reya
Mark Collins
Chairman of Residential, CBRE
Camilla Dell
Founder & MD, Black Brick
Lulu Egerton
Partner, Strutt & Parker
Santhosh Gowda
Chairman & MD, Strawberry Star
158
162
168
172
286
290
292
Rising Stamp: Surveying the
new SDLT landscape
London Central Portfolio
Scheme Players: How to form a
successful joint venture
Winckworth Sherwood
On architectural drawings &
copyright law
Boodle Hatfield
James Grillo
Head of Country Houses, Humberts
177
294
Potential office-to-resi pitfalls
Boodle Hatfield
Penny Mosgrove
MD, Quintessentially Estates
Ben & Nick Wilson
Founders, Residence One
INTERIORS & DESIGN
The Language of Luxury
Joe Burns on designing for cultural
differences
Curating Space
April Russell on how to showcase art
Techno House
The Next Level on kitting out The
Lansbury in Knightsbridge
181
186
Special Rooms
262
Lawson Robb’s guide to designing dressing
rooms, ensuite spas & smoking dens
(Book)Case Study
Artichoke builds a baroque library
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256
260
270
298
300
302
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306
2015’s Capital Gains Tax for
non-residents
London Central Portfolio
Inheritance Tax & the UK
property market
Russell Cooke
On Right to Rent & the prime
lettings industry
SA Law
Second home ownership
& the EU’s new succession rules
Boodle Hatfield
On breach of trust claims
against solicitors & licensed
conveyancers
Weightmans
These briefings are intended as guidance only;
no action should be taken in reliance on them
without specific professional advice.

DEVELOPMENT QUARTER
London’s top 10 niche & boutique
schemes
According to CBRE’s hot list
Clarging It
British Land builds a new benchmark in
Mayfair
‘Stately & Palatial’
QFT’s plan for the Hyde Park Barracks
‘Country House Clause’
Planning triumph for a new stately home
in rural Warwickshire
From degenerate pub to Chelsea des res
How Linton Property Developments
pulled it off
Deconstructed
i) A super-prime family home in
Hampstead, by Regal Homes
ii) Cool comfort in Fulham, by
Vitruvius & Company
Interview
Nicky Gibbard on Helical Bar’s grand
designs for Barts Square in the City of
London
Principles of Development
A retrospective of the ten projects that
made MSMR Architects
192
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213
224
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206

Features
102 109
ECONOMICS, POLICY & ANALYSIS
Chart Failure? The secrets of a good property index
There are a lot of property statistics and indices to choose from, but are any of
them actually reliable indicators of market performance? Parthenia’s James
Wyatt charts the ups and downs of the UK’s most-used house price indices.
‘Use the current economic sunshine’ before the next global slump
The UK is on track to be hit by another downturn in real estate markets in
2018, just after the US, claims Grosvenor Group’s Graham Parry.
Seven solutions to the housing supply conundrum
Delivery of more housing is topping many agendas as May’s electioneering gathers
pace. But ‘there is a problem,’ points out JLL, in that many of the proposed ‘solutions’
to the housing shortage are, taken in isolation,‘merely a brick in the wall’.
The main risks to the UK’s residential property market
Knight Frank rates eight of the most scary risks to property price growth and
performance over the next five years.
Eurozone quantitative easing and the UK property market
The European Central Bank’s decision to make some more money could swing
both ways for Britain’s residential property market, says Chestertons’ Nick Barnes.
A history of the mansion tax in quotes
A brisk trot – in the words of the key players – through how the idea of a mansion
tax progressed from Lib Dem vision to hard Labour policy over the last five years.
HERITAGE
Restoration Man: On the value of project managers in historic
renovations
Andrew Shirley talks to Knight Frank’s James Carter-Brown about the value of
a good project manager and the mechanics of rural project management.
LETTINGS
Scare B&B: Just how risky are short-term lets?
With scare stories of all-night parties and pop-up hotels doing the rounds, what
are the risks HNW clients should be made aware of, asks Boodle Hatfield’s
Kevin Fidler.
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105
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113 120
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230
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MARKETING
Top Marques: On the value of branding in residential property
development
A luxury property brand needs to resonate with its high net worth audience and
answer the question, ‘why would I want to live here rather than somewhere else?’
The success of a super-prime scheme depends upon it, says Joe Burns.
Video Gains: Could video streaming change the face of prime property
marketing?
The revolution – in the property industry at least – is being televised. Ken Burgess
explains how new advances are allowing today’s developers, agents and purchasers
to be in two places at once...
Out of Africa: On high net worth Nigerian buyers in London
Super-rich African oligarchs have spent over £600m on luxury homes in London
in the last three years, with Nigerian buyers alone accounting for £250m, notes
Beauchamp Estates.
CONSTRUCTION & DEVELOPMENT
Mayfair’s £4.5bn luxury development surge
Going super-luxe generates a price premium of 107% compared to neighbouring
‘normal’ homes in Mayfair, claims Wetherell – and developers are cashing in.
The Right Side of the Park: Why W2 has the strongest development
potential of any PCL market
Bayswater’s where it’s at for development and regeneration potential in prime
central London, says Knight Frank’s Tom Bill.
Vertical Horizon: Investing in the future of London’s skyline
While debate rages on over the aesthetic impact of tall towers, Kathrin Mc-
Clintock and Alex Ground of Russell Cooke explain why current and future
skyscrapers continue to play a vital role in the capital’s economy...
Inside the skills shortage threatening PCL’s future growth
Jackson Rowe’s Bob Hearnden explains how a ‘construction crunch’ is already
affecting future growth in the luxury development market, and why fundamental
issues must be addressed if it is to continue contributing to the UK’s
economic success...
The views of contributors are not necessarily those of PrimeResi or its publishers.

MARKET FORECASTS
Crystal Balls
A summary of prime property market
forecasts for the year ahead
There’s a pretty broad spread of
forecasts amongst the top prime
property research units, although most
are agreed that 2015 will be a year
of two halves, cleaved by the general
election.
What happens in the latter half of the
year depands, thanks to the mansion
tax debate, almost entirely on who
comes out on top in May.
PrimeResi Price Forecasts 2015
• Prime central London:+1%
• Greater London: +2.8%
• National: +3.4%
Based on an average of 16 of the top prime
residential forecasts.
May’s general election is, of
course, the major feature on
the horizon, with a strong consensus
that polling day will be the year’s
pivot-point. Winkworth, taking it to extremes,
is predicting a 5% drop in central
London’s house prices in the run up to
May, followed by a 5% increase through
the second half of the year, leaving the
market with no change in 12 months’
time.
That 0% forecast is a popular one in the
capital: Knight Frank also put it in for central
London, while Hamptons’ and Savills’
respective +0.5% and -0.5% for PCL are
as close as it gets without saying it. Both
Savills and RICS have gone with the zero
across Greater London.
Because of the election – and because
of one policy in particular – the range of
market forecasts in prime central London is
relatively extreme, from -5% to +5%. It all
depends on who wins in May and whether
Osborne’s SDLT reform has done enough
to quash Miliband’s thirst for a mansion
tax. Chestertons and Savills both thought
it was too big a call to make, opting instead
to issue two sets of forecasts for central
London: one assuming a Conservative win
(no mansion tax) and one assuming a Labour-led
win (which could/would result in
some kind of annual levy on £2m+ homes).
Savills believes that PCL prices will
10

plummet by 5% if a mansion
tax kicks in next year, while
Chestertons is a little more positive,
putting its weight behind
a 1.5% price rise even if Labour
walks a majority (+5% if
a Tory triumph). Savills is still a
touch pessimistic without a new
high-value homes levy, though,
plumping for a price drop in
PCL even if the Conservatives
win and dismiss all the mansion
tax chat for another four years.
Only Carter Jonas has joined
the firm in forecasting a price
drop – also of 0.5% – for prime
central London in 2015.
In Greater London, the Centre
for Economics and Business
Research (CEBR) stands alone
in forecasting a reduction in
house prices. Everyone else has
gone positive, with CBRE going
wild with a +7% forecast.
Hamptons provides the voice
of reason, with a conservative
(small c) +1.5% across the wider
capital. The average prime
resi forecast for Greater London
stands at a very reasonable
+2.8%.
It’s a similar picture nationally:
The CEBR thinks prices
across Britain will drop a bit
(by 0.8%) while CBRE thinks
they’re in for a 6% increase over
the next 12 months. It all averages
out at a +3.4%.
Taking a longer-term view,
almost everyone is on the same
page: Prices are going to carry
on up, but not at the same pace
as we’ve seen in London over
the past few years. Q
11

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2014 NEWS
REVIEW
=
VIEWS &
OPINIONS
REFERENCE
BRIEFINGS
=
DEVELOPMENT
QUARTER
PROFILES &
INTERVIEWS
=
INTERIORS
& DESIGN
DEALS &
INSTRUCTIONS
=
PRIME SALES
DIGEST
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