Supermarkets - In Good Shelf?

• Bear is keen to highlight how the recent trend in food price inflation doesn't seem to be slowing down the performance of the UK's leading supermarkets.

• Bull, who's long been a supporter of the long, secure and inflation-linked income that supermarkets provide, is still keen to own a few stores of his own.

• Unfortunately, the reluctance of long income and annuity funds to sell up their supermarket holdings means opportunities to purchase supermarket property are few and far between.

• The two agree that dabbling in the indirect market might be a canny way to satisfy Bull's need for supermarket exposure, until such time as a direct property comes available.

• Bull and Bear are taking a well deserved summer break and will return on the 31/08/2025.

• Have a good August.

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Onwards and Upwards?

• Bull and Bear reminisce about the days when 25 year leases with five yearly upward only rent reviews were first introduced.

• They both think the Government’s latest plan to abolish upward only reviews has been ill-thought through and that ministers should be concentrating on much more pressing issues.

• Overall they consider that this latest ‘tinkering’ will have only a marginal impact on the investment market, not least as average lease lengths are now well under 10 years.

• Their concern is that the whole thing may backfire on the Government and impact those corporates who use sale and leasebacks as a fundraising option.  

• Either way, Bull is still convinced that 2025 will turn out well for the sector.

• Have a good Sunday.

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Corporate Jollies and Tempered Optimism?

• Although Bull has spent much of the last week watching high-class sport, he has found a small window (before the Men's Wimbledon Final) to discuss the half-year figures for 2025.

• Bear remains concerned about the conflict in the Middle East and what is going to happen with Trump’s global tariff policy. He is still struggling to think of many compelling reasons for investors to get off their fences. 

• Bull is more optimistic and points to evidence of increasing investor appetite for prime commercial property and an expectation of further inward yield movements over the next few quarters.

• The overall sentiment appears to be one of tempered optimism, but with a hope that the mid-year results will provide more confidence for investors seeking to deploy capital. 

• Enjoy your Sunday.

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Mamils and Startups

• Bull is dismayed to find Bear in a figure-hugging, lycra speedsuit, ahead of the 4th annual Boost bike ride in September.  And he isn't shy to share his feelings on Bear's new look!

• He is far more positive, however, about the prospects for UK plc, where the entrepreneurial spirit remains strong. 

• The pair review the BNP Paribas Real Estate 'Next X Startup Index' and discover that, whilst London is still the startup capital, other key regional hubs have flourishing startup ecosystems, with the support and infrastructure in place for new businesses to succeed.

• Enjoy your Sunday.  

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London's Olympic Park

• Bull & Bear are feeling a bit sore after walking 20 miles for the Boost Olympic Sports Walk on Friday, which they both agree was the best Boost Charity Walk yet.

• The walk began in the Queen Elizabeth Olympic Park and both protagonists are itching to share the knowledge they picked up about the wider development.

• The site, at Lower Lea Valley, was a barren wasteland when it was chosen to host the Olympic arenas, media facilities and athletes' accommodation. Over the course of the next 7 years, the site was developed into one of the most spectacular Olympic Parks and played a major role in London's fantastic Olympic and Paralympic Games in 2012.

• They both agree that it is another major success story in London’s list of urban regeneration projects.

• Enjoy your Sunday.

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World Cities Rankings 2025

• Bull is feeling sore that London has lost out to New York in the Annual St Bride’s World Cities Index (for long-term property investment).

• Bear points out that it is hard to argue against US corporate growth which remains the envy of the world.

• They both agree though that America’s contribution to protecting the global environment is both half-hearted and irresponsible.

• All in all, in a world where there are so many great cities, both Bull and Bear feel justifiably proud that London won the silver medal again.  

• Have a good Sunday.

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Sunshine and Showers

• Whilst it certainly feels like Summer has well and truly arrived, Bull and Bear discuss whether it is all sunshine for the UK property markets or whether grey skies and showers lie ahead.

• The commercial property market continues to show some signs of improvement. At the All Property level, both capital and rental values increased by 0.3% in May, and total returns were 2.2% over the last three months.

• The residential market still remains some way from being buoyant, but there are some encouraging signs emerging.

• Bull and Bear discuss the Government's plans to help, including the proposals detailed in Wednesday's Spending Review. Whilst the consensus view is that they appear to be on the right lines, house builders really need action not words. And they need it now.

• Enjoy your Sunday.

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The Cyber Menace

• After the recent spate of cyber-attacks on UK businesses, Bull & Bear reflect on what this new threat means for the property industry.

• Bull believes that cyber-attacks, coupled with increasing market volatility, are clear reasons why it makes sense to invest in property. 

• Bear agrees that in periods of heightened risk there is strong case for the “steady as she goes” benefits of property, especially when the investment is backed-up by the safety net of a strong income return. 

• However, Bear also cautions that the property industry is not immune from the cyber-threat.  In fact, he argues that the risks from phishing and malware are now simply too perilous to ignore.

• Enjoy your Sunday.  

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Reinvigorated Offices

• Whilst Bull has been celebrating Spurs' recent Europa League triumph, Bear has been busy up in Leeds, gauging sentiment at UK REiiF.

• Much to Bull's surprise, Bear is feeling particularly upbeat about the UK property market, and in particular, the resurgence of the office market.

• Sentiment around offices has improved markedly and the volume of recent transactions compared with other sectors backs this up.

• Bear is also encouraged by the amount of offices being bought for redevelopment and is intrigued by how the planned alternative uses vary from city to city.

• Enjoy your Sunday.

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10.5 on the Richter Scale

• Whilst the most recent IPF Consensus Forecast for UK property total returns in 2025 is 8.8%, Bull is standing by his pre-Christmas prediction that they will come in higher at 10.5%.

• Bear still cannot understand why Bull seems so determined to stick his neck out.

• Bull argues that the fog which has been shrouding the investment market over the past few years is starting to lift and brighter days are ahead.

• Enjoy your Sunday.

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The Power of Football

• As the domestic and European football seasons draw to a close, Bull wonders whether there is any correlation between the success of a city’s football club and the strength of its property
  market?

• Bull & Bear use the 'Big Nine' regional office markets as a test case, comparing the league positioning of each city's football club with its prime headline office rent.

• The theory can't explain Liverpool Football Club's dominance in the Premier League, and should definitely not be used to predict strong office rental growth in Wolverhampton, Nottingham or Bournemouth this year.

• It does, however, serve to highlight how football can be harnessed to deliver economic prosperity, particularly when it comes to new stadium development.  For example, Everton's new stadium has acted as a catalyst to transform Liverpool's historic waterfront and, if Manchester United get the go-ahead, the re-development of Old Trafford could deliver up to £7.3 billion per year to the UK economy.

• Enjoy your Sunday.  

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Retail Renaissance

• Despite it being a Bank Holiday weekend, Bull and Bear meet up to discuss the state of the retail market.

• Although retail has long been regarded as the sickly child of property, they discover that it’s not all doom and gloom. For example:

• The March / Q1 2025 retail figures from the ONS were far better than the forecasts.

• Retailer distress is currently at historic lows and vacancy rates are broadly stable.

• Numerous occupiers have expansion plans this year and rents are growing in various locations.

• Institutional capital is active again in all retail subsectors.

• High street yields have started to harden on the back of strengthening investor demand.

• The sector is expected to retain its crown as the top performing commercial real estate asset class in 2025.

• However, the sector now faces a raft of new pressures through the ‘triple whammy’ of increased national insurance employer contributions, rising minimum wages and reduced business rates relief. The hope is that these cost pressures won't trigger another set-back.

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Tariffs - Trouble or Turning Point?

• Bear has some concerns over the effect Trump's tariffs might have on the UK property market.

• He thinks that weak economic growth will stunt real estate investment and the additional costs occupiers will have to burden may hit sentiment around certain sectors.

• Bull, ever the optimist, thinks that these tariffs might inadvertently promote UK property.

• He highlights the predicted interest rates cuts, UK tariffs being lower than elsewhere and investors viewing UK property as a safe haven, as reasons to be positive about investment in UK property.

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A Tale of Two Cities

• Bull is feeling uplifted by the success of the London Landmarks Half Marathon last Sunday which showed off London in its very best light.

• However, Bear is concerned that the capital’s outward success may be masking some deep-seated social challenges, such as homelessness and mental ill-health.

• Together though, they agree that London is, and will remain, the European city of choice for property investment, not least as investors will continue to be drawn to its stability during a time of global economic upheaval.

• Bull and Bear are taking a week off for Easter and will be back on Sunday, 27 April. Like the rest of the world, they have absolutely no idea what craziness will transpire in the meantime!

• Enjoy your Sunday.

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