The days of the world of business being carved up over brandy and cigars in the club room may be over, but high-powered clubs and societies – small groups of influential individuals with a direct line to the centre of financial power – continue to play a vital role in forming property policy and making decisions.
They range from the group of powerful individuals the Treasury has tasked with finding ways of getting CMBS borrowing moving again, to the rich and influential developers and investors who pay to meet the country’s most powerful politicians.
But what exactly are these shadowy organisations? And how much say do they really have on what happens within the property industry?
The Bank of England Property Forum
What it does The forum is made up of representatives from across different sections of the property industry and meets quarterly with Bank representatives to discuss the state of the market. It was established in the early 1990s to keep the Bank informed about developments in the commercial property market. More recently, due to the market downturn and the problems this has created for the financial system, it has been discussing what can be done to address the difficulties caused by excessive property debt.
Key members The Bank’s senior representative is Andy Haldane, executive director of financial stability. The forum is chaired by Ian Marcus, chairman of European real estate investment banking at Credit Suisse. Among the high-profile property figures who have sat on the forum in recent years are Stephen Eighteen, head of non-core real estate at Royal Bank of Scotland; Nick Robinson, former head of real estate at Lloyds Banking Group; Harm Meijer, property analyst at JP Morgan Cazenove; and John Gellatly, head of real estate multi-manager at Aviva Investors.
Issues covered Meetings are undertaken under strict Chatham House rules. It is understood that recently discussions have centred on the need for regulators and the government to address problems that could be caused by securitised loans due to mature over the next two years, and on what can be done to get the commercial mortgage-backed securities market functioning again.
The Windsor Group
What it does The Windsor Group is an informal organisation – it has no charter, no constitution and no rules – comprising the heads of the biggest surveying firms in the country. It meets once a year in Windsor, reportedly because when it was established in the 1990s, this was the most convenient meeting point for those invited. Members have dinner together on a Thursday evening, usually with a heavyweight political or industry speaker, before attending a conference the following day. Despite the lack of a formal structure, the group gets down to some pretty serious business in terms of the issues that vex agents.
Key members Membership comprises the senior partners or chief executives of the top 15 general practice property services firms in the UK
Issues covered Current head Nick Shepherd, managing partner of Drivers Jonas Deloitte, explains “No one is going to be there outlining their commercial business strategies, but we address issues that are common to all the members. This might include things like how we deal with the universities that supply a lot of the graduates to the industry, how we see the market for professional indemnity insurance and our experiences in that market, or more recently, plans for valuers to become accredited. All very practical issues.”
The Professional and Business Services Group
What it does Comprised of representatives from the property industry and other professions, the group meets with business secretary Vince Cable and other ministers on a regular basis to discuss the challenges facing their respective industries.
Key members Headed by former City of London Corporation policy and resources committee chairman Sir Michael Snyder, the group is made up of representatives from the property services firms – DJD’s Nick Shepherd currently sits on the forum – and by a number of lawyers and accountants.
Issues covered Those that affect professional service firms, such as taxation, recruitment and regulation.
The RICS Commercial Property Market Forum
What it does The RICS Commercial Property Market Forum meets on an irregular basis in order to discuss market trends.
Key members As with the Bank of England Property Forum, it seeks to take a cross-section of people from different parts of the market – bankers, fund managers, private equity players, listed property companies and agents – in order to accurately gauge the market. It was initiated by former RICS president David Tuffin and continues under current president Robert Peto.
Issues covered Market trends and issues, as well as potential ways of dealing with them. In spite of attracting a broad spectrum of ideas, one senior industry figure, who preferred to remain anonymous, said such forums can often prove counter productive. “You often find that a herd mentality can emerge at these things, especially when the same people are on lots of different committees.” he says. “People end up all pushing in the same direction, and it doesn’t help in terms of encouraging independent thought, so I prefer to steer clear now.”
Bank Credit Committees
What they do These are the panels, drawn from the risk officers and others within the hierarchy of major banks, which decide whether or not new loans are extended. They also decide whether funds needed to aid restructurings and workouts of distressed loans can be made available.
Key members Very senior bankers. Even senior property bankers have a tone of awe and fear in their voice when they mention “Credit”, as the committees are generally known, and the tribulations they have had when facing up to them over the past few years. Property investors will probably never meet these people.
Issues covered To lend or not to lend. During the property boom years, the relationship between bankers – who meet with borrowers to drum up business – and credit committees became inverted, with the former calling the shots. Now, client-facing bankers complain that even what looks like a solid and safe deal won’t make it past “Credit” as banks shy away from risk. And as for speculative development finance – you can forget about it.
The boards that could shape the Government’s planning agenda
The Conservative Party Planning Sounding Board
What it does One sector of the property industry that loves a committee or a forum is the world of politics and planning. And one of the most important committees at the moment is the Tory Planning Sounding Board, a body which meets regularly to discuss the planning regime.
Key members Bodies such as the British Property Foundation, CBI, Royal Town Planning Institute and Town Council Planning Association are all represented on the board.
Issues covered The planning regime. In light of the lack of solidity and direction exhibited so far by the new coalition government, the body takes on even greater importance. Westminster sources indicate that the board met once before the election, and has met twice since then. As one participant put it “It is certainly the direct line to ministers, and we would hope it is a useful avenue to shaping the emerging planning agenda. Generally, there is great scope for the industry to help translate ideology into action.”
The Property Forum
What it does Listed as a donor club on the Conservative Party’s website, this body, known simply as The Property Forum, seeks to find the ear of the now empowered Conservative party by fundraising for Tory party headquarters.
Key members The forum, which is chaired by Helical Bar chief executive Mike Slade, says that it comprises “key players within the property industry”.
Issues covered An annual membership of £2,500 gives the chance “to meet senior Members of Parliament over breakfast, discuss current topics and learn about related issues”.
mike.phillips@estatesgazette.com
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