QuoinStone Outlook August 2021
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In the first of a series of short bulletins, we will provide you with a concise update on our experience of how the market is currently operating, how we are helping our clients and investors, and the progress QuoinStone has made during the pandemic.
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Firstly, our take on the market. We live and breathe the London market with a special focus on the City Fringe. In particular, through our work in Shoreditch, we have seen demand in the letting market go through the worst contraction since the 2000s and start to bounce back again over the last 2 or 3 months. We have successfully let a number of floors in our properties as tenants have returned to search and we expect to see a great deal of activity on the secondary and grey markets as space is released over Q3 and Q4 2021. With pressure on rents as vacancy grows, we are delivering strategies to make our offices more attractive than the competition through CatA+ initiatives, flexible lease terms, service provision and cutting edge marketing. Even to stand still all of the ingredients need to be right and by offering tenants a completely seamless transition into their new offices, we are successfully making the decision to lease space in our buildings an easy one.
The wider market is showing ever increasing polarisation, with core markets (whether office or logistics) seeing record rents and yields, and secondary markets experiencing downward pressure on rents and incentives. Whilst we expect the limited price movements we have seen to date in the secondary market to increase, in the value add sector that we operate in, and still with virtually no distress in the market, this still looks some way off.
We also work across other markets outside of London and will cover these in future bulletins.
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QuoinStone |
QuoinStone were pleased to be able to complete the management buy-out of the business in February 2021, at the depth of the pandemic. With full control back with the managers, we have embarked on a growth and repositioning strategy in order to take advantage of the recovery in the property market over the coming years.
Since the MBO we have doubled our assets under management to around £200m through the expansion of our asset management business and we are experiencing increased demand as property owners move away from in-house management to take advantage of the expertise provided by boutique asset management firms such as QuoinStone.
We are currently expanding our team so that we can continue to offer best-in-class service to our clients and continue to invest in exciting new projects.
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PropTech Partnerships |
Part of our repositioning is to formalise some of our partnerships and relationships with particular attention on PropTech firms who we see as the future of Asset Management and how services to landlords and tenants will evolve. Our focus is on areas of the business that cause the most pain points for us, our clients and professional teams. We are already working with HyScore, a CleanTech business to improve the monitoring and assessment of office cleaning; Building Passport, a building data business that will revolutionise the way that property data is stored and shared between professional teams and 3rd parties such as the emergency services; and Equiem, an app based business that will allow us to have a direct line of communication with our tenant’s staff to provide services and information that will enhance their experience of working within our buildings. We will report more on these businesses soon, and show how our asset management services are enhanced by partnering with PropTech firms that deliver real improvements to stakeholders.
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Bureau |
We also partner with traditional service providers and in our CatA+ projects, we have been working with furniture supplier, Bureau. Bureau have provided a first-class service, developing a furniture solution for a traditional warehouse style building in Shoreditch which we have offered to the market as plug-and-play space to SME businesses. Bureau were able to space plan each floor and select & source a wide range of furniture as well as other parts of the FF&E including A/V, kitchen equipment and related cutlery and crockery. With their full-service offering, the project has been smooth and efficient and we look forward to signing off on the final work in the coming months.
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CatA+ |
We have undertaken a fully costed CatA+ project assessment with one of our clients to be ready to provide semi-serviced space to tenants where demand requires it. This involves taking a traditional Cat A specified space and costing and delivering a limited Cat B refurbishment, provision of furniture and stripped back services, including cleaning, broadband, shared meeting rooms and kitchen facilities. We have worked with a leading legal firm to craft a short-form lease to allow occupation within weeks of an initial approach by a tenant. In a world where tenant flexibility and last-minute decisions are made, the ability for owners to respond quickly is critical. We’ve attached our CatA+ service brochure which explains more of the process.
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As we continue to expand and add depth to our services, we will share our experiences and the exciting innovations that we are embracing, so that other owners and investors can benefit from our knowledge. We’re keen to work with people who are aligned with our approach and if you’d like to hear more about what we’re up to, please don’t hesitate to call for a chat.
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Tim Struth MRICS
CEO
Tim is co-founder responsible for business growth & transaction execution
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Steve Howling MRICS |
CIO |
Steve is co-founder responsible for asset management & investment strategy |
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