Savills plc - Investor relations

AUBREY ADAMSEXECUTIVE’SOPERATIONSOther significant deals included:• the sale and leaseback of the LDV headquarters at Drews Lane,Washwood Heath, Birmingham for AXA SunLife Plc c/o AXA Real Estatein partnership with LDV Limited. The site comprises 25.58 hectares(63.2 acres) of land and 125,401.4 sq m (1,349,854 sq ft) of buildings;• the letting of 43,000 sq ft at 20 Soho Square, a new development by IVGAsticus Real Estate, the largest letting in Soho in 2003;• the letting of 70,000 sq ft at Woolgate Exchange, 25 Basinghall Street,EC2 on behalf of the German Bank, West LB; and• the letting of 90,000 sq ft at 1 St John's Lane, EC1 for Standard Life andBee Bee Developments.The transactional markets in Hong Kong were difficult in the first six months ofthe year but rebounded strongly. The effect of SARS and the war in Iraqaffected the office rental market where marked decreases in demand wereexperienced and average vacancy rates peaked at 15%. In Shanghaitransactional income increased by 45% and the Chinese business has begunto make a positive contribution.Residential AgencyThe residential market experienced a slow start to 2003 with concerns overthe economy and job cuts in the City. In London prime property was especiallybadly affected, with sales turnover down as much as 50% at the start of theyear. However, from the summer, there was a turnaround in the primeresidential markets dominated by a lack of supply; although the prime Londonmarket saw price falls of about 2.5%, the country residential markets held upwell with price increases in most parts. In total about 2,200 properties weresold during the year, equating to £1.8bn in value. Our average property soldfor about £1.4m in London and £0.63m in the country. Highlights include thesale of Puttenham Priory with a price guide of £7m, and our Edinburgh officeachieved a new record in the sale of a country house in Scotland.Purchasing AdvicePrime Purchase, our independent subsidiary which acts for retained buyers ofresidential property in both central London and the country, has completedits second successful and profitable year. In 2003, a country office wasestablished in Hampshire adding to its existing headquarters in SloaneSquare. Of particular note was the work in relation to the acquisition, offmarket, of a multi-million pound penthouse in South Kensington and a 4,000sq ft family house in Wimbledon village. In the country, highlights included thepurchase of Chartknolle, a 245 acre residential farm in West Dorset togetherwith a Georgian house of over 1,500 sq ft to the West of Cirencester whichwas acquired privately.Residential Letting2003 was another tough year for the Residential Lettings business. Primecentral London was particularly affected as a result of the knock on effectsfrom the downturn in the financial markets since 2001. There was also agreater than usual number of landlords selling, to cash in on capital growth,which in turn created lower rental yields. The Home Counties departments inWindsor, Bishops Stortford and Sevenoaks all experienced significant growthin their income.AuctionsThe Auctions department again had a good year selling 640 lots with a valuetotalling £140m at an average success rate of 87%. Residential andcommercial properties were sold in Manchester, Liverpool, Birmingham andacross the South East to Bristol and the West Country. Notable salesincluded a west London site by the A40 at £1.66m, an industrial investmentin Middlesex at over £2.6m and a portfolio of 17 residential properties in Bristolselling for £2.5m.13