Managing risk in a high inflationary environment
It is widely reported that real estate is one of the most heavily taxed and regulated industries in the UK. It is one of few (if not the only one!) that must pass through a quasi-judicial process to obtain permission to operate. There is a distinct lack of political certainty around any comprehensive housing strategy from Whitehall, caused by the all too frequent short-termist Government thinking – and if this wasn’t challenging enough, we also face the headwinds of increased interest rates and stubbornly high inflation.
Each of these factors brings uncertainty to an already lengthy process, where significant upfront investment is required. In the face of this, we have strived to take control where possible so that we can reduce exposure to these shifting sands.
Regal London is a fully integrated business of 140 people. A team of experts who cover the lifecycle of the asset, from land and planning, investment and legal, sales and marketing, customer care and asset management and, of course, our expert construction team. This control from start to finish means that we build out our projects on time and within budget.
Recent history shows that this has real, tangible benefits. We were able to keep our sites open every single day throughout the pandemic. We have delivered all our developments on time or even, in the case of Grace House, comprising 170 later living apartments in Westminster, ahead of schedule in the summer of 2022.
The revolving door of the Housing Minister’s office has become a favourite industry joke. However, with the political flip flopping comes a more serious challenge. Our in-house planning and stakeholder engagement teams know every inch of the political landscape in the boroughs in which we are active. We are politically agnostic, if politicians see the local challenges and their solutions in the same way that we do, we are able to work together. This is also reflected in our partnerships – each one of our projects is unique, with different partners and structures driving towards shared success.
Our inhouse construction team are staring down the barrel of a sector wide labour crisis. Recent figures published by the Migration Advisory Committee show that vacancies were 65% higher in the three-month period (Nov-Jan 2023) than in the immediate pre-pandemic period (Jan-Mar 2020).
This continuous acute labour shortage is in part caused by the Brexit exodus and an aging workforce. The construction industry also suffers from an image problem and is widely misunderstood.
Rather than sit back and wait for the answers, we created the Regal London Real Estate Academies in partnership with Building Heroes, a charity dedicated to providing training for Service Leavers. We have broadened this offer to include local people furthest from employment too.
Our two academies (Brent and Watford) each train around 70 people per year and many either join our supply chain, move into self-employment within the sector or even join our own business. We believe we can really benefit from the skills of those in the armed forces – tenacity, teamwork, dedication and problem solving.
At Regal London, we pride ourselves on never building anything that we wouldn’t be prepared to live in ourselves, and that obsessive attention to detail and quality can only really be achieved with this fully integrated approach.