london market overview - elysian

London Market OverviewProspects in a Brexit world

LONDON RESIDENTIAL MARKETEU Referendum

51.9%LEAVE

48.1%REMAIN

71.8%TURNOUT

REFERENDUMVote Tally


IMMIDIATE ISSUES

POLITICALSTABILISATION BOND YIELDS

DEBT MARKETSAND CREDIT

BANK LIQUIDITY

INTERESTRATES

CURRENCY

LONDON RESIDENTIAL MARKETEU Referendum - What Happens Now?

1. Any Member State may decide to withdraw from the Union in accordance with its own constitutional requirements.

2. A Member State which decides to withdraw shall notify the European Council of its intention. In the light of the guidelines provided by the European Council, the Union shall negotiate and conclude an agreement with that State, setting out the arrangements for its withdrawal, taking account of the framework for its future relationship with the Union. That agreement shall be negotiated in accordance with Article 218(3) of the Treaty on the Functioning of the European Union. It shall be concluded on behalf of the Union by the Council, acting by a qualified majority, after obtaining the consent of the European Parliament.

3. The Treaties shall cease to apply to the State in question from the date of entry into force of the withdrawal agreement or, failing that, two years after the notification referred to in paragraph 2, unless the European Council, in agreement with the Member State concerned, unanimously decides to extend this period.

4. For the purposes of paragraphs 2 and 3, the member of the European Council or of the Council representing the withdrawing Member State shall not participate in the discussions of the European Council or Council or in decisions concerning it. A qualified majority shall be defined in accordance with Article 238(3)(b) of the Treaty on the Functioning of the European Union.

5. If a State which has withdrawn from the Union asks to rejoin, its request shall be subject to the procedure referred to in Article 49.

• FortheUKtoleaveithastotriggerArticle50

• FormalunequivocaldeclarationbytheUKGovernment

• Twoyeartimescalefornegotiation

• Unlikelytobeginuntilinformalnegotiationshavebegun

London Residential MarketSo what does it mean for residential?


UNDERLYING REASONSpeople invest in London remain strong

London as a ‘safe haven’

Strong legal structure, assetprotection & multi-cultural society

Ease of global access with 4 main airports in close proximity

Centrally located betweenAsia & North America

%

Population increase

Low interest rates

Robust economy

World class education

Favourable exchange rates

Favourable time zone


London Residential MarketEU referendum – Currency impacts

4/07/2016U

SD to

GB

P

25/06/2016

27/06/2016

16/06/2016

25/05/2016

15/05/2016

6/05/2016

26/04/2016

17/04/2016

8/04/2016

1.30

1.34

1.38

1.42

1.46

CURRENCY IMPACTS


London Residential MarketEconomy remains robust

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.520

10

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

%

FORECAST

Source: Oxford Economics

ECONOMY REMAINS ROBUST

LONDON RESIDENTIAL MARKETEU Referendum London Residential Market

Universities have real pulling power

0

1

2

3

4

5

0

50

100

150

200

250

300

350

400

Lond

on

Cam

brid

ge, U

SA

Los

Ange

les

New

Yor

k

Chi

cago

Bei

jing

Oxf

ord

Sta

nfor

d

Cam

brid

ge

Prin

ceto

n

Tim

es U

nive

rsity

rank

ings

: Com

bine

d sc

ore

in T

op 5

0

Combined score of top 50 universities Number of universities in top 50

Source: Times university rankings

UNIVERSITIES HAVE REAL PULLING POWER


London Residential MarketPopulation

50.0

52.5

55.0

57.5

60.0

62.5

65.0

67.5

70.0

72.519

6519

6719

6919

7119

7319

7519

7719

7919

8119

8319

8519

8719

8919

9119

9319

9519

9719

9920

0120

0320

0520

0720

0920

1120

1320

1520

1720

1920

2120

2320

2520

27

UK

Pop

ulat

ion

(mill

ions

)

UK Historical and Projected Population

Population Projection, zero migration Population Projection, low migration (185,000 pa)

Population Projection, principal projection Source: ONS

UK HISTORICAL & PROJECTED POPULATION

London Residential MarketOther Factors


London Residential MarketStill a favourable tax regime

0%

5%

10%

15%

20%

25%

30%

35%

40%

Hong Kong Singapore New York City Paris London Shanghai or Beijing

Buy (stamp duty) Hold (property tax / council tax) Sell (capital gains + VAT if applicable)Source: CBRE research

STILL A FAVOURABLE TAX REGIME


London Residential MarketHow global cities compare

Global connectedness (GaWc)

Performance & Potential (kearney) Power (Mori)

London Alpha++ 60.1 1519.8

New York Alpha++ 63.1 1384.1

Paris Alpha+ 52.9 1307.9

Tokyo Alpha+ 46.3 1290.4

Singapore Alpha+ 37.6 1207.4

Hong Kong Alpha+ 43.1 1084.6

Sydney Alpha+ 31.9 970.1

STILL A FAVOURABLE TAX REGIME

London Residential MarketSo what does this mean for residential?

LONDON RESIDENTIAL MARKETEU ReferendumLondon Residential Market

New Build Sales

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

2001

- 20

06 A

vera

ge

End

of 2

007

End

of 2

008

End

of 2

009

End

of 2

010

End

of 2

011

End

of 2

012

End

of 2

013

End

of 2

014

End

of 2

015

2016

Q1

Sale

s

Source: Molior

NEW BUILD SALES


London Residential MarketHouse Price Index

80

100

120

140

160

180

200

220Ja

n-07

May

-07

Sep

-07

Jan-

08

May

-08

Sep

-08

Jan-

09

May

-09

Sep

-09

Jan-

10

May

-10

Sep

-10

Jan-

11

May

-11

Sep

-11

Jan-

12

May

-12

Sep

-12

Jan-

13

May

-13

Sep

-13

Jan-

14

May

-14

Sep

-14

Jan-

15

May

-15

Sep

-15

Jan-

16

Aver

age

Hou

se P

rice

Inde

x(B

ase

= Ja

n 20

07)

Prime Central London London UK Source: Land Registry

HOUSE PRICE INDEX


London Residential MarketLevelling off

80

90

100

110

120

130

140

150

160

170

180

Month 1

Month 3

Month 5

Month 7

Month 9

Month 11

Month 13

Month 15

Month 17

Month 19

Month 21

Month 23

Month 25

Month 27

Month 29

Month 31

Month 33

Month 35

Month 37

Month 39

Month 41

Month 43

Month 45

Month 47

Month 49

Month 51

Month 53

Month 55

Month 57

Month 59

Month 61

Aver

age

Hou

se P

rice

Inde

x

Current cycle Apr-11 to Apr-16 Previous cycle Mar-04 to May-09 Source:Land Registry

LEVELLING OFF


London Residential MarketLondon Housing Supply – can we depict this in a nicer way?

0

10,000

20,000

30,000

40,000

50,000

60,00019

95-9

6

1996

-97

1997

-98

1998

-99

1999

-00

2000

-01

2001

-02

2002

-03

2003

-04

2004

-05

2005

-06

2006

-07

2007

-08

2008

-09

2009

-10

2010

-11

2011

-12

2012

-13

2013

-14

2014

-15

Num

ber o

f Com

pltio

ns

Housing Completions CBRE Estimated Required Target New London Plan Target

LONDON HOUSING SUPPLYcan we depict in a nicer way?


Global Residential MarketHouse Price Growth

Italy

3.8% So

uth

Kore

a11

.3%

Sout

h Af

rica

19.2

%Sw

itzer

land

37.6

%U

nite

d St

ates

53.2

%D

enm

ark

58.2

%Sp

ain

70.4

%Fi

nlan

d82

% Net

herla

nds

105.

6% Can

ada

133.

9%N

orw

ay14

4.6%

Fran

ce14

9% Belg

uim

174.

4%Ire

land

185.

5% Aust

ralia

221.

4%U

nite

d Ki

ngdo

m23

1.9%

Japa

n-1

4.5%

Ger

man

y-7

.8%

GLOBAL RESIDENTIAL MARKETHouse Price Growth


London Residential MarketOutperforms other assets

Decade 57.9 4.7 13.0 82.0 -44.8 84.7

Year -0.7 -4.9 -2.5 -10.4 -36.3 12.4

CommoditiesS&P 500

Shares FTSE 100

Shares FTSEAll Share Gold Brent Crude London

Property

OUTPERFORMS OTHER ASSETS

London Residential MarketLocal Market Performance



£0

£100,000

£200,000

£300,000

£400,000

£500,000

£600,000

£700,000

£800,000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

SW8 London

LOCAL MARKET PERFORMANCE


80

100

120

140

160

180

200Ja

n-07

Apr-0

7Ju

l-07

Oct

-07

Jan-

08Ap

r-08

Jul-0

8O

ct-0

8Ja

n-09

Apr-0

9Ju

l-09

Oct

-09

Jan-

10Ap

r-10

Jul-1

0O

ct-1

0Ja

n-11

Apr-1

1Ju

l-11

Oct

-11

Jan-

12Ap

r-12

Jul-1

2O

ct-1

2Ja

n-13

Apr-1

3Ju

l-13

Oct

-13

Jan-

14Ap

r-14

Jul-1

4O

ct-1

4Ja

n-15

Apr-1

5Ju

l-15

Oct

-15

Jan-

16Ap

r-16

Ave

rage

Hou

se P

rice

Inde

x (B

ase

= Ja

n 20

07)

Wandsworth London UK

London Residential MarketLocal Market PerformanceLOCAL MARKET PERFORMANCE



0

100

200

300

400

500

600

700

800

900

2009 2010 2011 2012 2013 2014 2015

Num

ber o

f sal

esLONDON MARKET PERFORMANCE


London Residential MarketLocal Market Perfomance

0%

10%

20%

30%

40%

50%

60%

70%

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

5,000

Wandsworth Southwark Lambeth

Uni

ts u

nder

con

stru

ctio

n

Sold Unsold Proportion sold

Unit sales in schemes under construction

Proportion of unsoldcompleted stock

Wandsworth 2%

Lambeth 1%

Southwark 1%

Inner London 5%

Greater London 3%

LONDON MARKET PERFORMANCE


London Residential MarketCBRE House Price Forecasts

2016 2017 2018 2019 2020 5 year growth 2016-20

UK 3% 3% 4% 5% 5% 22%

London 5% 3% 5% 6% 6% 28%

Prime Central London 3% 4% 6% 6% 6% 28%

HOUSE PRICE FORECASTS

London Residential MarketOther Factors


London Residential MarketRegeneration Premium

2.1% 5.7%

2.9%

6.7%

3.4%

8.5%

3.8%

0%

2%

4%

6%

8%

10%

12%

14%

16%

Aver

age

Annu

al G

row

th

Local Authority Growth Regeneration Uplift

Riversi

de Q

uarte

r

Southb

ank

N1 Islin

gton

North G

reenw

ich

Paddin

gton B

asin

Stratfo

rd

Woodb

erry P

ark

REGENERATION PREMIUM


Infrastructure opportunityCrossrail IINFASTRUCTURE OPPORTUNITY

Crossrail 1


London Residential MarketNew Public TransportNEW PUBLIC TRANSPORT


What do residents want? CBRE Retail SurveyW h a t t y p e o f o u t l e t w o u l d y o u m o s t l i k e To h a v e i n y o u r r e s i d e n t i a l d e v e l o p m e n t ?

Coffee shop/ Pastry

70%

54% 54%44%

36% 34%

Supermarket Restaurant Wine Bar ConvenienceStore

Delicacies

77%Good quality retail had a

‘strong positive’ impact on residential

91%‘Convenience’ was the main benefit of living around retail

83%Important to have a

strong retail offering

65%Preferred

independent stores

54%Said retail would make a

development more appealing

RETAIL SURVEYWhat type of outlet would you most like To have in your

residential development?


What do residents want?CBRE Amenity Survey

M o s t s o u g h t a f t e r a m e n i t i e s

Concierge

Have & use regularly

89%Don’t have but would like

58%

Swimming Pool



69%

Gym



76%

WHAT DO RESIDENTS WANT?Amenity Survey - Most sought after amenities

Recommended post Brexit U.K. real estate opportunities.

Television CentreTelevison Centre is at the heart of the largest redevelopment in West London.

Slated as the most iconic redevelopment in London, Television Centre’s apartments and penthouses are at the centre of an enriching place. With all-day cafés and restaurants, television recordings and cinema screenings, health club, pool and spa, hotel, private gardens, and landscaped terraces with a programme of cultural events.

Part of the multi-billion pound regeneration in White City. It is a milestone in the transformation of 145-acre White City, with £8 billion of investment bringing more than 5,000 homes, a Harvard-style campus of academic excellence, a media village, an expanded Westfield shopping mall and the largest-ever John Lewis department store. Facilities include the Soho House, screening rooms, BBC live show studios, gym, spa, pool and concierge service.

The Buckingham

Situated directly opposite the Buckingham Palace, residents will enjoy a centrality of location that few others possess.

Located in St James’s Park and directly opposite Buckingham Palace, The Buckingham apartments enjoy a centrality of location that few others possess. They sit at the nexus of London, surrounded by the best of British history, power and culture. The open space surrounding The Buckingham also frames some of Europe’s most elegant and beloved architectural landmarks, broadest avenues and grandest Royal Parks.

The development offers 1 bedroom to 3 bedroom options will all modern living amenities as well as private access apartments.

One Nine ElmsSoaring over 56 storeys into the sky, One Nine Elms will offer its residents unrivalled views of London’s most famous landmarks, from The Shard and the London Eye, to Westminster Abbey and the Houses of Parliament. All of the apartments for sale are linked to a 5-star hotel with luxury amenities. Residents will enjoy access to a 24 hour concierge, a spacious gym, pool, spa and the 50th floor residents’ sky lounge and terrace, a truly unique space to entertain with London’s skyline as your backdrop.

Right next door to Vauxhall Underground station, with speedy transport links into London’s West End and the City, it is also walking distance to the transforming 3km of London’s riverside into an ultra-desirable residential quarter, international business district, and outstanding cultural and leisure destination.

THE

BUCKINGHAM

GetintouchwiththeElysianteamtofind

outmore:

Emaar Boulevard Plaza Tower 1, Suite 1602, Dubai, U.A.E.

+971 (0)4 278 3700www.elysianglobal.com

london market overview - elysian

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