New Grosvenor boss gets thrown in at the deep end

Barely three months into his new role as boss of Grosvenor’s UK & Ireland division, James Raynor is already facing what could be the biggest test of his career as he steers the business through the Covid-19 pandemic and the government’s lockdown of the country. Some of the challenges are of a more personal nature than others. Like many of us, Raynor is now adjusting to working from home. His morning commute has been replaced with exercise to start the day in an attempt to find “some semblance of normality”, he says. But as a self-described “relatively social animal”, he admits he is finding it tough to spend his days staring at “postage stamp pictures of people on a screen for huge amounts of time”. But Grosvenor is adjusting as a business too. Raynor has approved the waiving of the current quarter’s rent for most of its retail, food and beverage tenants, having already offered a deferral of rent payments prior to the nationwide lockdown. The next aim is to sit down with tenants and work with them “to make things the best they can be for when we come out of this,” Raynor says. The government’s imposition of a moratorium on commercial landlords to stop evictions of tenants who miss rental payments as a result of the virus is “logical” and “the right thing to do”, Raynor says. “Ultimately, we are a part of the same ecosystem as them and we want our streets to be full, vibrant and active and our tenants are crucial to that,” he adds. “I’ve no idea how long this crisis will go on for, but I’d imagine several quarters and that’s what we’re planning towards. So, where we can help, we will.” Grosvenor is also trying to help charities and its communities, as well as looking into providing some of the estate’s residential apartments to the NHS. “It’s an overwhelming national crisis and the right thing to do is to do as much as we can,” Raynor says. “I’m not sure we have a silver bullet for all of the issues, because I think that this in all likelihood is going to lead to a major recession, which always has casualties, but hopefully we can make a small difference.” Follow the leader It’s a challenge for anyone to step outside of the bubble of the current crisis and look beyond the immediate issues, but Raynor has been planning for his new role for some time, having been named as Craig McWilliam’s successor last July. Even so, he had to step up almost nine months earlier than planned after McWilliam suddenly departed the business in January, a development he declines to comment on. “I knew I was moving into the role,” Raynor says. “The fact that it’s earlier than I thought it would be – well, it just accelerates things, I suppose, and some of the timelines I’d set for myself obviously changed. But it’s hard for me to ask my team to be agile and quick and progressive and smart if I can’t demonstrate that. So, I have to just take up that challenge and run with it.” Making Grosvenor in the UK and Ireland more dynamic and proactive is a recurring theme in conversation with Raynor, who, having headed up Grosvenor’s operations in Europe from 2013 until last year, is in a good position to see the operating differences between the two divisions. “Obviously the UK business is a lot bigger and has a large standing portfolio [300 acres across Mayfair and Belgravia accumulated since the 17th century], whereas the overseas businesses don’t have that same level of historical background and by their nature are a little bit more active in the capital markets,” he says. I’ve no idea how long this crisis will go on for, but I’d imagine several quarters and that’s what we’re planning towards. Where we can help, we will “The European business was quite nimble. It had to be because you just don’t have the same kind of market position as you do here [in the UK]. I’d like to bring some more of that agility into our business and speed things up a bit, as well as flatten the structure.” A crisis like Covid-19 means some of the steps Grosvenor has taken are already making it more like the business Raynor wants it to be. “It’s a much more active role that we need to take to really understand our tenants’ businesses and needs so that we can best help them,” he says. “I’d like us to be a more proactive and agile company that is trying to move things forward for the betterment of everybody. It’s beholden on us to realise that we’re a partner to the community, working towards making these places as vibrant, as interesting and as inclusive as possible.” Raynor makes clear that he plans to build on Grosvenor’s strong foundations, rather than entirely overhaul its strategy. But he wants a more innovative approach to business, including looking at how it can use technology more intelligently, gather more data and use it to make better, faster and smarter decisions. He also hopes there will be a way of sharing data with Grosvenor’s stakeholders so they can all improve together. In terms of the portfolio, the London estate can probably work harder, Raynor says. There are development projects, including the office scheme above Crossrail at Bond Street and the former Audi garage by Eccleston Yards, which have been in the works for some time. But these are now progressing, he says, and will help to enrich the London estate and move it forward. Grosvenor also now has planning consent to create more than 1,500 private rented flats at a former biscuit factory in Bermondsey. There, Raynor says, the company is “developing what will become the next estate”, of the group, building off the DNA of the existing holdings in the West End of London. He points out that “estate management is the long-term understanding of how to curate and develop, and that’s a skill that’s apart from simply just managing single buildings. It’s about a complex tapestry and all the things that interlink.” Green is good Another ambition Raynor has for Grosvenor is to make it greener, evidenced by his appointment of Tor Burrows as director of sustainability shortly after he took over. Sustainability “needs a seat at the highest table,” Raynor says. “We need to integrate it fundamentally into everything that we do.” At the time of Burrows’ appointment, Raynor said climate change was the single biggest risk facing Grosvenor today. He explains that “a long-term company requires that there is a long-term future”. “The success of any property company is inherently linked over a period of time to the underlying success of the city and the neighbourhoods in which it operates,” he adds. “That success is now linked to how green those cities and neighbourhoods are.” He goes on: “At an asset level, responsible tenants are going to want to occupy buildings that have the best environmental performance and therefore by not addressing those issues, we wouldn’t attract the best tenants. “You also get to a point where buildings that are not environmentally sound, investors won’t want to invest in them so there is [also] clearly a valuation impact. There’s the business imperative but there’s also a genuine moral imperative as well.” Raynor hopes that the real estate sector can unite, share knowledge and find smart sustainability solutions together. Then, he says, “the better we’ll all be”. “We shouldn’t be trying to compete with each other on this.” In the near term, Raynor is back to getting to grips with running one of London’s largest estates from his home. This now includes two videos a week from him to the rest of Grosvenor GBI’s employees, “which is obviously tremendous for them and for me”, he says wryly. He hopes, though, that “if something good can come out of this, it will be that we understand our tenants’ businesses better, they understand us better and we can work better”. He adds: “This is probably the opportunity to do more good, more broadly, than we’ll ever have again. So that’s what we should do.” To send feedback, e-mail louise.dransfield@egi.co.uk or tweet @DransfieldL or @estatesgazette