BNP Paribas Real Estate’s former UK chief executive John Slade is joining private investment bank Evans Randall as executive chairman after officially stepping down earlier this week.
Slade (centre) said he was “going back to the coal face” of real estate after leaving BNP PRE after its takeover of Strutt & Parker last month. Strutts senior partner Andy Martin took over the role of UK chief executive as part of the acquisition.
“I had a great five years with BNP Paribas and their French friends,” says Slade, “but for me to be back at the coal face is very exciting.”
He adds: “It was great having a big outfit. What we were doing at BNP PRE was disruptive to a degree. We wanted to take a position in the marketplace and we did that, so for me personally their success has been my success.
“The ability to expand that firm and the ability to do the takeover has been very exciting, but I was probably spending 65-70% of my time doing administration and management, even if that was managing a takeover, so to be able to get back to my own agenda and the agenda of Evans Randall, where we deal with the real estate, deal with the finance, deal with the tenants, and deal with the equity and debt is very exciting.”
At Evans Randall, Slade’s role will be to use his contact base, particularly in the Far East, to source partners for investment in London real estate.
Paul Kendrick (pictured right), chief investment officer at Evans Randall, says: “What John has done in the past five years in particular, in building a profile in the Far East – which is where most of the capital is coming from at the moment – is going to be helpful because we are looking to increase our influence in that area and raise capital.”
Value-add opportunities
While Evans Randall was one of the first to sell to the wave of Chinese and Hong Kong investors coming into London – in 2012 it sold Drapers Gardens, EC2, to Gingko Capital Management for £280m, and most recently 33 Old Broad Street, EC2, to Hong Kong’s SEA Holdings for £258m – it now sees its role more as partnering with overseas money on value-add opportunities and developments.
“It is quite easy as a foreign investor to come to the market and buy something that is bright and shiny and all the work is done,” says chief executive Kent Gardner (pictured left). “We want to assist the investor so it can be a smarter player with a local partner.”
“We need to be there investing alongside these people and improving the property for them,” adds Slade. “It is very tempting for the Chinese/Hong Kong investors to come in, particularly in the added-value sphere, and think they can do it all very quickly. Then when they get here they realise it is not quite the market they thought it was. If we can create that mutuality, where we are sitting alongside them, not selling to them, then that can be really important.”
While Evans Randall may well have been known for investing in trophy assets such as the Gherkin at 30 St Mary Axe, EC3, and Drapers Gardens, EC2, it can no longer compete with the weight of money chasing those assets – nor does it want to , says Gardner. Now, the firm sees its role as buying product or creating product that it can sell to the buyers of those trophy assets at the right time in the cycle.
Plan for each asset
“That is what distinguishes us from the fund managers, who just want to build out funds under management and crank the handle,” says Kendrick. “We have a plan for each asset. Sure, at the moment we are light – we peaked at [a portfolio valued at] £5bn and we are now down to £1.2bn, but to us that doesn’t matter because you must sell your asset at the right time.”
With Slade on board, Evans Randall says it wants to set itself ahead of the curve in London real estate, providing the right space for tenants and solid income for its partners – and buying the trophies again, once the market is right.
“We want to be nimble for the cycle as that changes,” says Gardner. “But there will be an increasing focus on service and providing what tenants want ahead of the curve, and on being a leader in that space. We want to continue to create quality product for foreign investors coming into the market. In time that may not only be on a deal by deal basis, but there could be to opportunity, depending on where we are in the cycle, to look at a fund with a particular focus.”
For Slade, the move is the missing piece in a jigsaw puzzle.
“I was in a private equity operation before – in Accrue – which went very well, and it was only the excitement of the challenge of repositioning BNP Paribas that took me out of that,” he says. “This is where I want to be. BNP was a hybrid, bank and an adviser, but it was still an adviser, and to now be able to sit with investors and have a commonality of interest is really, really important.”
“Being a chief executive is fantastic,” he adds, “but ultimately it does involve a lot of administration and ultimately you do end up getting your agenda nicked the whole time, so you can’t concentrate on the things you want to concentrate on. I hope this gives me more of an opportunity to do that.”
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