John Slade tells London office buyers: time to fill your boots
If this year happens to be your first time at MIPIM, allow one of your industry elders to offer his guidance. This is John Slade’s 20th time in Cannes for the event – or it might be his 21st, he’s not entirely sure – and he has some words of wisdom for the newbies.
“Pace yourself. Work very hard. Latch yourself onto one or two really senior guys and try to tag along to all their meetings and understand what’s going on. Use the opportunity to gain some experience.”
And yes, by pace yourself, Slade means go easy on the partying. “I always come down on the plane thinking I’ve got to pace myself,” says the 66-year-old, whose career has seen him traverse much of the agency industry, becoming chief executive of BNP Paribas Real Estate in the UK between 2012 and 2017.
If this year happens to be your first time at MIPIM, allow one of your industry elders to offer his guidance. This is John Slade’s 20th time in Cannes for the event – or it might be his 21st, he’s not entirely sure – and he has some words of wisdom for the newbies.
“Pace yourself. Work very hard. Latch yourself onto one or two really senior guys and try to tag along to all their meetings and understand what’s going on. Use the opportunity to gain some experience.”
And yes, by pace yourself, Slade means go easy on the partying. “I always come down on the plane thinking I’ve got to pace myself,” says the 66-year-old, whose career has seen him traverse much of the agency industry, becoming chief executive of BNP Paribas Real Estate in the UK between 2012 and 2017.
Sitting with EG at the MIPIM stand of Kroll, at which he now chairs the international real estate advisory group, Slade says he expects a week of agents talking up the market before crashing back to reality when they return to London with a headache on Friday. And make no mistake, a frozen deals market will give them plenty to be glum about.
Fill your boots
A long-time fixture of the London office market, Slade is surprised that dealmaking is taking as long as it is to recover given the recent falls in value.
“If you can buy well-let buildings with long leases, which are ESG-orientated, BREEAM Excellent, at yields now in the City which may be at 5%, compared to 3.75% or 4% a year ago, I think it’s probably time to fill your boots,” he says.
“I think you’ll look back in a year, 18 months, and think ‘I should have been in the market then’. The last time we had this was 2008, 2009. In 2008, you could still buy these buildings at 6.5%, 7%. By the end of 2009, they’d come into 5%. When they come in, they come in quickly.”
Valuers may, in fact, have moved too quickly in marking down assets, he adds – the UK certainly now looks cheaper than most other markets in Europe. That’s likely a result of valuers being criticised for not moving quickly enough in crises gone by.
“They can’t win,” he says. “I think they are doing a pretty good job, but I don’t think the real estate market moves as quickly as some people want to make out. It’s not a liquid market, therefore it’s not as dynamic as some of its competitor markets.”
For now, as Slade sees it, there is too much nervousness, particularly from institutional money.
“The trouble with institutional buyers is they don’t want to be entrepreneurs, they don’t want to lead the field,” he says. “Some of them would rather wait until the discovery point is found rather than go in and take a risk that they’re not buying at the bottom. And the problem with that is you miss the bottom.”
Instead, he adds, it will be high-net-worth individuals, family offices, and buyers from Singapore, Hong Kong and Japan most likely to lead a revival in dealmaking.
Art of the phone call
Slade loves the cut and thrust of that dealmaking, a constant over a varied career. He is in the midst of penning a series of columns for EG about the ways in which the agency business has changed over his years in it.
The impact of technology on doing business has been a thread. Mobile phones and e-mail? “We had none of that when we started,” he says. But he says that although tech changed parts of the real estate investment market for the better, he agrees with Knight Frank’s William Beardmore-Gray that real estate professionals need to be reminded to “talk not text”.
“Clients aren’t going to come to your office and find you, you have to go out and find them, you need to be out on the street, you need to be out meeting them and you need to be in front of them,” he says. “The art of the telephone call is disappearing at the moment, which is very bad, with WhatsApp and text. It’s much better to get on the phone and talk about things. You don’t have this ping-pong-ball conversation, you have a conversation which is instant.
“The e-mail, sophisticated computers, they have been brilliant. But in terms of people doing deals, winning clients, there’s no substitute for getting out there.”
You heard the man – time to get to your next MIPIM meeting.
To send feedback, e-mail tim.burke@eg.co.uk or tweet @_tim_burke or @EGPropertyNews
