House of Horrors

• After a night of Halloween horrors, Bear reviewed the Q3 2025 transaction volumes and is feeling gloomy about the inertia in the UK property market, which appears to be haunted by the spectre of Mrs Reeves's November Budget.

• Bull, however, is convinced that the final quarter of the year could mark a step change in activity, with a number of £100m plus deals in the London office market poised to complete.

• With UK property set to deliver total returns of 7.4% pa 2025 and 8.4% pa in 2026, Bull also believes that property could deliver on the upside and is buoyant about the prospects for the other sectors.  

• We may not escape the Autumn Budget unscathed, but there is momentum building in the market just waiting to be released.  

• Enjoy your Sunday.  

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Playing the Long Game

• Bull & Bear are discussing a slightly lesser-known long income alternative to traditional sale & leaseback deals that form part of many long income funds - income strips.

• Bull is initially apprehensive. He thinks they are fundamentally a bit boring and has worries about inflation outpacing market rental growth.

• Bear persuades him that given prevailing market conditions, income is king, and the sizeable margins over gilts makes long income products an attractive alternative to active property right now.

• Bull & Bear are having a week off next weekend for Half Term and will return on the 2nd November.

• Have a good Sunday.

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Change ... or Face the Consequences

• Bear is back onto one of his favourite topics … demographics.

• He reckons that within ten years there will be more old age pensioners in the UK than children and that will put serious pressure on the economy.

• Bull is sanguine. He can only see upside from the changes this will bring. ‘’Change means … more conversion, adaptation and development’’.

• The two of them reflect on how the property market has evolved over the past 25, 50 and 75 years and what lies ahead over the next 25 years.

• Change is inevitable. But even Bear admits that fortune will only favour the brave.

• Enjoy your Sunday.

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Student Struggles?

• Bull and Bear discuss all things student, and especially the rising cost of attending university. Students now need £61,000 over the period of a three-year degree course to maintain a minimum socially acceptable standard of living. And that excludes the £9,353 per year tuition fees.

• More than four in ten universities in England were expecting to be in a financial deficit by this summer just gone, and there is lots of talk about the consolidation and merging of universities.  

• According to Knight Frank, just shy of £830 million was invested in the UK purpose-built student accommodation market in Q2 2025, taking half-year investment volumes to circa £1.6 billion. Investors have shifted their appetite to standing student stock (rather than development) as a first preference.

• Enjoy your Sunday.

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Tech, Data and the Ryder Cup

• Bull & Bear drag themselves away from the sporting drama of the 45th Ryder Cup to discuss the impact of the US-UK Tech Prosperity Deal. 

• Bull is convinced that the £ billions of investments pledged by the US Tech giants such as Microsoft, Google and Nvidia will reshape the UK’s position in global technology.  And as the UK expands its digital infrastructure, the deal shines a spotlight on the increasing role of data centres.

• The complexity, capital requirements and other barriers to entry mean this property sub-sector will remain the remit of data centre specialists. 

• But as some of the traditional industrial-focused Reits seeks to expand their data centre footprint and expertise, even Bear is convinced that the story is compelling.  It's time to power up!

• Enjoy your Sunday.  And come on Team Europe!

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Regional Office Revival?

• Bull & Bear are loving the rapid growth in prime rents at the top end of Central London's office market. In Farringdon, there is talk of rents touching on £115 psf and rents have broken through the £200 psf mark in the West End.

• Whilst encouraging, Bear fears for the the UK's regional cities. Prime rents may be growing, but they are still a long way off a level that makes new development viable and the lack of new space coming through epitomises this. 

• Bull and Bear agree that whilst the regional office markets have their challenges, they'd like to see some brave developers come forward and command the rents needed to make development stack up. 

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An Oneirocritical Tipping Point

• Bull has had a dream. It may not have been as insightful as Martin Luther King’s, but he still needs to call on Bear to interpret it.

• Although Bear claims not to be an oneirocritic (dream analyst) he can only forsee problems ahead.

• Unsurprisingly, Bull sees the brighter side of life.

• Mostly though, they both agree that the market is at a tipping point. Whether it tips up or down hangs on the content of the Chancellor of the Exchequer’s Autumn Budget on 26 November.

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Residential Roundup

• Following their quick catch-up last week on the commercial property market, Bull and Bear do the same this week for the residential sector.

• Disappointingly, annual UK house price growth slowed down to 2.1% in August. Consumer confidence has also been dented by growing fears of potential job losses, while mortgage rates ticked up again last month.

• The housing market is currently delicately balanced and the noise around new property taxes is concerning. Supposedly, changes to SDLT, capital gains tax and national insurance tax for landlords are all possibilities in late-November’s Budget. Bull and Bear's concern is that transaction activity between now and the Budget will grind to a halt as a result of the speculation.

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Back in the Saddle

• After the long summer holiday recess, and a few too many Pina Coladas, Bull & Bear ease themselves back into the saddle with a round-up of the UK Commercial Property market.

• Bear is worried that Mr Trump's attacks on the US Central Bank and the ongoing tariff wars are creating macro-economic uncertainty, which is causing a malaise in the UK property market.

• Bull has no such concerns citing a host of signals that suggest now is a good time to invest across a whole range of property sectors.

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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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