2022 in review and our 2023 outlook

In 2022, we were pleased to start the year by being recognised by CoStar in their awards for:

• 1st Most Active Office Disposal Agency - London North & Northern Fringe (sq ft)
• 1st Most Active Office Disposal Agency - London North & Northern Fringe (#)
• 1st Most Active Office Disposal Agency - East & Eastern Fringe (#)
• 2nd Most Active Industrial Disposal Agent (#)

We continued to work hard for our clients, sourcing opportunities and helping them take advantage of market activity. By doing this, we transacted on over 155 deals across office, retail, leisure, industrial & logistics, investment and a mix of other uses.

Space transacted totalled over 525,000 sq ft, with over 100 further deals representing 576,119 sq ft under offer. Of these deals, we have £154,300,000 of sales in 14 transactions currently in solicitors' hands.

We look forward to seeing many more deals over the line very shortly.

2023 will be the year of opportunity for many in the property market, especially those well-funded, with access to cash or ready funding. There will be some compelling opportunities out there, and we see the prevailing market conditions as a great opportunity for investors to enter the market, and investment will likely happen across all asset classes.

We are seeing a trend for owner occupiers looking to capitalise on adjustments in pricing and seeing 2023 as a good time to consider investing in their business premises and seeking vacant, part vacant or short-term income opportunities for purchase right across Central London - which we predict will continue through H1.  

Others are capitalising on changing trends and are consulting Strettons on achieving the maximum income from their property through asset management and other opportunities to enhance property value pre-sale.

There are some compelling reasons for people to enter the market and use the cash reserves that many have been waiting to invest.

In 2022, with the launch of our new website and investment in driving more traffic to our lots, we were able to increase exposure for our clients by 30%, with leads for lots on our website increasing by 80%. We continue to evolve our offering and how we are bring lots to market before, during and after each auction cycle.

In our July auction, we sold one of the largest-ever residential investment properties and the highest-ever lot to be auctioned in E3. Temple Dwellings was an unbroken freehold mansion block of 24 apartments that sold for a fantastic £7,500,000, somewhat undermining the myth that only cheap, dilapidated properties can be sold at auction.

Industrial and warehousing sites are also highly sought after. However, auction buyers are still very conscious of getting good value, and lots that look overpriced will invariably attract less attention. As ever, there is no shortage of buyers for well-priced stock with an angle to add value.

In 2023, we expect to see a number of properties coming to the market from lenders seeking to recover loan debt and property owners looking to realise cash. The resulting softening of the market will present an opportunity for well-funded buyers to step in. As with all markets, it should create some volatility rather than the sluggish conditions of recent months since the increases in base lending.

Some sectors of the market have faced more significant challenges, particularly development land lots. A shortage of skilled builders following Brexit and increased building material costs have meant construction costs have increased in the last 12 months, impacting the price developers are prepared to pay for land. But again, we have seen some terrific results for land that is sensibly guided.

In 2022, we were pleased to have grown our management footprint in the City and West End, bringing even more office buildings under our portfolio.

We strengthened our relationships with some influential London landlords, bringing on a range of managed properties from offices to retail portfolios and drive-throughs occupied by global brands.

Rent collection increased following Covid restrictions and relationships with our tenants.

We acted to implement a programme of building reinstatement valuations due to the rapid increase in building material costs and a lack of contractors due to Brexit.

In 2023, we are taking on the management of more office blocks helping our clients' curb market forces and increased legislation. Our approach to securing our clients' position through regearing, minimising voids and tendering for new utility contracts will be our focus.

We foresee working with tenants much more closely as the economy slows and all that will bring. Please visit our recent insights here for more advice on protecting assets during uncertain times.

In 2022, Notting Hill Genesis, Metropolitan Thames Valley Housing and Network Homes appointed our Development Consultancy team to provide development consultancy and valuation services across their property and development portfolios. The three housing associations provide a combined 133,000 homes.

The team strengthened ties further with our wider valuation and advisory services teams to provide advice at all stages of the development cycle alongside our agency and management teams.

In 2023, we will observe carefully to see where values land and advise our clients about the latest trends. We are mobilising the team to help our Local Authority and Housing Association clients with their end-of-year valuations.

With the appointment of the frameworks and the others we currently work on, timely feedback for our clients on market rates and changing legislation around development will be our focus.

2023 will be a challenging year for the property market, and the full extent of losing Help to Buy is still to be seen in the new homes sector. Along with the commercial sector, the residential market is facing uncertain times. Generally, values have started to fall at low marginal rates due to the smaller budgets resulting from higher interest rates and rises in the cost of living, plus job insecurity. However, this is after a period of reasonably high rates of rising values. Predicting the rate of the decline with certainty is near impossible, and any value adjustment will be regional and property type in nature.

We are seeing the launch of new schemes delayed into 2023 and incentives coming into play once again. The balance of negotiation has tipped again in favour of the buyer with their reduced number. Still, new homes may offer a good choice for the fewer buyers with a steady supply and willing buyer offering incentives, when compared to a reduced supply of secondhand stock with fewer people looking to trade into a new home. Expectations are for a noticeable price reduction and stabilisation into the later part of 2023, but affordable housing tenures such as shared ownership may become more desirable. Our team is constantly appraising schemes being marketed. This market intelligence puts our team in a good position to appraise units, as we have seen the property market's ups and downs over many years.

In 2022, the team has been busy helping in the recovery of assets for lending clients across England and Wales.

To meet increasing demand, we further strengthened our service with the appointment of a new senior surveyor.

Together, the existing team of some of the most experienced receivers in the country provides professional advice on handling distressed property loans. Our instructions range across all property types and sizes for a range of clients, and we are asked to advise at all stages of the lending process. We will if we can help a lender resolve an issue without resorting to enforcement.

In 2023, we will continue advising clients according as market conditions change. During difficult times, lenders, or anyone that may have lent or invested money and taken a charge over a property, may be faced with understanding the issues around what steps are open to them.

Our expertise in dealing with development land, commercial and residential assets, often with legal, physical or other impediments which only become evident on enforcement, means that we are well placed to resolve issues.

In 2022, three of our surveyors passed their APCs, coached by our senior management team alongside our wider in-house network of Chartered Surveyors. The dedication of all teams has helped us maintain a 100% pass rate.

We welcomed 13 new team members across Commercial Agency, Auctions, Asset Management, Development Consultancy, and Receivership.

We launched a new website in March, bringing three sites into one, along with six integrations with our legacy systems and technology. With this, we have been able to bring in more leads than the industry-leading property portals for our listings, nearly every month since launch, helping our clients sell or let space faster.

In the press, we had 174 brand mentions across the property trade and national media.

Our experienced teams are reinforced by the expertise of Strettons' wider in-house experts covering auctions, investment, commercial and residential agency, litigation support, development appraisal, affordable housing and valuation, property and asset management, and the in-house insurance brokerage. We are well-primed to help our clients take advantage of the upcoming year, plan for their next move or increase the value of their assets pre-sale.

As always, we are here to answer any questions about your particular property or share what we're seeing in the market.