UK Real Estate Horizon Scanning 2020

In the following pages, the Linklaters’ team have set out their take on a handful of the themes that have shaped the past year in the real estate world and which, we think, will shape the year ahead. I hope you will find our team’s insights thought-provoking.

The theme which is top of my mind, however, is not a legal trend or a piece of new legislation. Instead, it is a theme which gained well-deserved momentum throughout 2019, and which I hope will continue apace in 2020. It wasn’t even specific to the real estate industry but crossed many, if not all, workplaces: mental health and well-being.

Gradually, it is becoming acceptable in the workplace to talk about “not being OK” and the more conversations we have about mental health in the workplace, the easier it becomes for those in need to seek help and stay healthy. Deaths in the workplace have plummeted over the last 30 years. Why? Simply because when people have been physically injured due to unsafe working environments, action has been taken to make everyone safe. Now is the time for us to acknowledge the need to create working environments which are healthy for minds as well as bodies.

I am not naive enough to think our demanding workplaces can avoid some degree of stress, depression or anxiety, but if we or our colleagues suffer as a result, we should be able to spot it early, offer a helping hand and help them get back in shape. According to the Health & Safety Executive, the majority of sick days claimed over the last year were due to stress, depression or anxiety, totaling 12.8 million working days lost in the UK. That’s a huge impact on our national productivity, but more importantly a huge impact on our colleagues and, in turn, their families and friends.

So in the year ahead, as well as talking about the legal themes affecting our working lives, can I suggest we also talk more about it “being OK not to be OK”? That would be a new year’s resolution that is Brexit-proof and (dare I say it) even more important.

Best wishes to you and your teams for 2020.

December 2019

 
 

Retail insolvencies

2019 was another challenging year for the high street with total insolvencies in the wholesale and retail sector increasing by 3.2% to 1,866 in 2019 Q1-3 from 1,808 in the same period in 2018, the highest for the period since 2013. As a result, there have been record high levels of store closures in 2019. Amidst continuing uncertainty regarding business rates, falling consumer confidence, the rise of the living wage and online competition, the challenging times in retail look set to continue into 2020.

"… record high levels of store closures in 2019… challenging times in retail look set to continue into 2020".

MEES

The recent Government Consultation on the Minimum Energy Efficiency Standards (MEES) sets even more ambitious targets for lettings of commercial properties than previously expected by proposing an increase from the current minimum E EPC rating to a C or even B rating by 2030…This new proposed trajectory as a stepping stone to achieving net zero carbon by 2050 will have a big impact for many landlords and investors despite the long lead time for the changes to be introduced.

"…there has been a steady fall in the percentage of F and G-rated certificates...".

Find out more.

Co-living

Society is changing; the way we communicate with each other, the way we work and the way we live. The Real Estate industry is responding to and anticipating changes in how people are choosing to live and what people need and expect from the built environment, not least because the success of a project is increasingly measured by its social impact ahead of its bottom line. Change manifests itself in relation to three forms of living; co-living, later-living and multi-generational living. Of course these aren’t the only areas experiencing growth or change, but the common thread is that they are all driven by fundamental changes in underlying human behaviours.

"The Real Estate Industry is responding to and anticipating changes in how people are choosing to live...".

Find out more.

Real Estate Funds

One of the prevailing trends in the current real estate fundraising cycle is the high number of perpetual-life and open-ended funds entering the market. What are the reasons behind this trend and what are the advantages and challenges of these types of fund, both to fund managers and investors? 

"…managers are increasingly utilising open-ended vehicles for strategies targeting a higher rate of return…".

Find out more.

Telecoms

The new Electronic Communications Code (the Code) was already showing its teeth when we commented on the new “human right to mobile telephony” this time last year but developments in 2019 have seen the Code really starting to bite coupled with the continuing political drive to ensure wider and faster broadband access. The Code is clearly here to stay, so what are the key developments in 2019 that landowners need to know?

"… there has to be a balance struck. We all want better phone signal. We all want to be able to download things much more quickly so we have to have the infrastructure there”. Nicky Morgan (Secretary of State for Digital, Culture, Media and Sport) – August 2019 

Find out more.

x Covid-19 Resource Hub