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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The Global Tirade

• Bull & Bear discuss the impacts and likely fall out from President Trump's tariff gamble.

• Bear gets his knickers in a twist as he watches stock markets around the world take a nosedive.

• Bull, however, senses an opportunity  as US tariffs are only likely to accelerate a process of reindustrialisation from which the UK will benefit.

• UK companies are set to spend £500bn moving their supply chains and manufacturing closer to home, and Britain could reap the benefits as global companies scramble to rightshore their operations in the face of increasing geo-political risks and economic uncertainty.  Risks that will be further exacerbated in a trade war over tariffs.

• Enjoy your Sunday.  

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TransPennine Offices

• Bear has been up north this week, crossing the Pennines from Leeds to Manchester.

• Whilst general sentiment in the regions seemed pretty positive, he's come home feeling a little uneasy about their office markets. 

• Bear has some reservations about the 'fully-fitted' office model and worries the money landlords have to pour into Grade A-minus and Grade B offices could deter investors going forward.

• Bull is quick to remind Bear that occupational sentiment is improving, and whilst there's no doubt many offices will require significant capital expenditure, the soft yields on regional offices represent excellent value for money and it's already starting to entice investors.

• Enjoy your Sunday.

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Treading Water?

• Ahead of The Chancellor's Spring Statement on Wednesday, Bull and Bear meet up to discuss the state of the UK house-building sector.

• Although the UK housing market has seen a robust start to 2025 (and is particularly busy at present as buyers rush to complete deals before a stamp duty saving runs out at the end of the month), the indicators of housebuilding are rather worrying.

• Residential house building decreased for a fifth month in a row in February, despite the Government reiterating that it will meet its house-building target of 1.5 million new homes in England by 2029.

• Most of England’s new homes are built by a small number of large firms. Bull and Bear finish by discussing why SME house builders now only develop 10% of new homes, compared to 39% in 1988.

• Enjoy your Sunday.

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Project London

• Bull & Bear discuss Sadiq Khan's recent appearance at MIPIM 2025 where he showcased his London Investment Prospectus, entitled Opportunity London.

• Always the sceptic, Bear is convinced that the mayor only jetted into Cannes for a quick photo opportunity!

• But once they dig into the prospectus in detail, Bull & Bear are impressed by the scale and ambition of the investment opportunities on offer, with many focused around London's strategic transport hubs including Liverpool Street, Victoria, Waterloo and Euston.

• Above all, Opportunity London demonstrates that the mayor, together with all tiers of London's government, are working hand-in-glove with the property industry to deliver transformational change.  And that should ensure that London continues to attract the lion's share of cross-border capital to make these ambitious redevelopment schemes a reality.

• Enjoy your Sunday.  

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Hurricane Donald

• Over the winter, the UK has suffered five storms … Ashley, Bert, Conall, Darrah and Eowyn. Protocol dictates that the name of the next storm should start with an ‘F’. Except that it won’t.

• To heck with protocols. An executive order has decreed that the next one will go back one letter to ‘D’. As in Donald.

• Brace yourself. In the words of Ronald Reagan … ‘You ain’t seen nothing yet’.

• Looking at the tremendous amount of hot air and gas that is building up on the east coast of America, this one is going to be a complete s***-storm.

• Bull and Bear discuss its worrying implications for investment.

• Enjoy your Sunday.

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Smile for the Square Mile

• Bull & Bear are discussing a market that's rather close to home this week - City of London offices.

• Bull is thrilled to hear that prime rents continue to break records as the occupational market seems increasingly willing to pay top dollar for Grade A stock.

• Bear is quick to remind Bull that there is more to the market than just the top end, and whilst investors/developers are desperate to turn secondary stock into prime Grade A offices, getting the numbers to stack up isn't so easy.

• Regardless, with a fair economic wind, opportunity awaits for those brave enough to take the leap.

• Enjoy your Sunday.

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