2011 was a challenging year for the property market with many high profile casualties and dismal news stories filling the property press. However, the property industry never stands still and last year also saw the launch of a number of proposals and initiatives which seek to address some of the current difficulties faced by the industry, including the Portas review, the Chancellor’s Autumn Statement, the NPPF, National Housing Strategy, Localism Bill and Community Infrastructure Levy. Here are views on some of these key proposals from Irwin Mitchell’s team.
"The health of the high street remains a barometer for the economic recovery in general and the Portas review raised a number of much wider concerns about the state of retail and the high street. Her recommendations will not be achieved overnight, but those with clear objectives which require fairly simple measures to achieve them (such as changes to business rates) will hopefully be tackled sooner rather than later. Many of the issues facing the high street will not be resolved without the support of the property industry and the need to involve all stakeholders is emphasised by Liz Peace who is interviewed in this issue of NewsReal." Lewis Myers, Partner
Construction and Infrastructure:
"The emerging asset class of infrastructure, which was given a boost in the Chancellor’s Autumn Statement, will be an interesting area to watch this year. High Speed 2 has already been given the go ahead and decisions are expected on a number of other high profile projects including Boris’s Thames Gateway Airport and further roll out of the nuclear power programme. It will be interesting to see whether other investors follow the pension funds and institutions who have signed up for the National Infrastructure Plan which was announced in the Autumn Statement." David Parton, Partner
"The proposed changes to the REIT’s regime in July 2012 is a positive measure which will bring opportunities for the industry this year. The removal of the current 2% entry charge, relaxation in ownership rules and reduced compliance obligations should make conversion to REIT status more attractive to property companies and investors. This could release some of the pressure in the investment market and we may yet see the creation of residential REIT’s which could reignite investment in residential schemes." Alex Barnes, Partner
"As ever, viability will remain a key concern for developers in 2012 and they will be closely monitoring the implementation of the Community Infrastructure Levy (CIL) by local authorities. Its true impact remains to be seen, but already significant variations are emerging in the way that CIL is being adopted by different local authorities. This could potentially lead to development “hot spots” emerging where a lower charge applies. In London, concerns have been raised about the potential impact of the Mayor’s Crossrail CIL which could make some schemes unviable. However, in some cases developers could be paying less under a CIL charging regime than under the current s.106 regime." Jo Footitt, Partner
"No review of the outlook for 2012 for the property industry would be complete without considering the impact of the Olympics. It promises to be a spectacular event and to bring London to the front of the international stage but it will also be interesting to see what opportunities present themselves at the end of the year. The Olympic legacy will need to make the most of the huge amount of property and infrastructure in Stratford and East London. A number of promising schemes have been announced and the best developers will already be thinking about how they can get a slice of the action in 2013 and beyond." Jon Vivian, Partner & Head of Real Estate