If ever a story highlighted that sometimes we only look at property matters through UK lenses, it was the news this week that Taittinger has bought land in Kent to establish a vineyard.
As we rightly worry that the South East is becoming unaffordable, the 83-year-old champagne house has seen an opportunity. It has bought 171 acres at Stone Stile Farm near Faversham, of which almost 100 acres will be planted with chardonnay, pinot noir and pinot meunier grapes to produce premium English sparkling wine.
Now much of this, of course, has to do with the fact that our cool climate, chalky soil and moderate sunshine is ideal for producing bubbles. (And our reputation for producing it has improved immeasurably thanks to labels like Nyetimber, Chapel Down and Ridgeview). But costs won’t have escaped Taittinger’s notice either.
Vineyards in Champagne sell for around €1.2m (£867,000) per hectare. And while farmland in the South East has been appreciating faster than many other asset classes in recent years, average prime arable values are closer to £25,000 per hectare.
• Congratulations to a highly diverse group of winners at this week’s Estates Gazette Awards. From the team behind Battersea Power Station’s transformation to Helical Bar’s (and LandAid’s) Mike Slade, 2015 offers a rich vintage. Winners of the other categories run from the very big to the very small and with almost 50 judges involved, EG’s are perhaps the most coveted and robust awards around.
• With British Property Federation chief executive Melanie Leech, I chaired an enjoyable and illuminating dinner this week featuring some of the industry’s most disruptive property players. Hosted by London-based shared-living housing business The Collective, it was a group that is changing the way property works. At one point their frustration at the industry’s closed-mindedness threatened to tip into bleakness. “Bleak?” one of them shot back. “Not at all. We’re just impatient for change. And with our generation you get less professional jealousy and no bullshit.” That was me told.
It wasn’t the only event challenging the status quo this week. The first REWIRE workshop was also held this week.
• The forecasts for 2016 are flooding in. Savills sees opportunity in the big seven cities and in “future core” areas in the capital. Rents, not capital, will drive growth. Cluttons, meanwhile, sees a slowing in rental growth in the City of London office market as almost 12m sq ft is under construction across central London. And my prediction? All forecasters will be proved right. At least in part.
• It is good to see property’s biggest lobbyists come together. Better together, to borrow a phrase: it is much easier for government to ignore industry calls for reform if voices are silent or, worse, divided.
The BPF, BCSC and the BCO warn that business rates are harming the economy. Their joint report says reducing the burden of business rates could unlock almost 4,000 jobs and £1.8bn of development over the next five years – more than the combined development value of the Shard, Walkie Talkie and Cheesegrater. Why? Well, according to the research, most of the cost of any increase is transferred to landlords as occupiers push for lower rents.
There are some sizeable, disputable figures in the report: increases in business rates may have prevented £670m of new development and resulted in 6,000 fewer jobs. Over the next five years, £1.8bn of new commercial property development might not happen because of expected rate rises.
Whether or not those figures are illustrative or real, government should consider the wider economic benefits and costs of rate reform ahead of March’s Budget. The chances of it doing so are certainly not harmed by this joint report. More joined-up thinking please.
