The Acorn Commercial & Development Update 1st Quarter 2021

Commercial & Development

1ST QUARTER 2021

Old Kent Road - see page 3...

On page 3...

Sale of site with consent for 111 flats...

On page 4...

Building sold for the British Red Cross...

On page 5...

Car lot in Southwark sold unconditionally...

On page 8...

The Acorn Group’s brand new HQ…

EDITORIAL The start to 2021 seems a little two-faced. On one side business is quite simply booming, but on the other, the general consensus is that Lockdown 3 has been the toughest yet.

Jeff East — Director

jeff.east@acorngroup.co.uk

It might be that the novelty and weather during the first lockdown made it easier to bear, and let’s face it, lockdown 2 back in November was short-lived and rather pointless. This third shutdown though, seems to have taken more of a toll on the population, and the 29th March couldn’t come soon enough.

So what has everyone been doing for the last three months then? Well, buying property if our results are anything to go by! It’s been record month after record month across our branch network, and we’re now consistently selling more than 500 homes every month. The professional side of the industry is also flying, and has seen us enjoy a fantastic first quarter.

Development sites and freehold investments continue to prove hotly contested, and we’ve seen a recent resurgence in interest for office space closer to Central London too.

Our Planning Management services are yielding results, and as you’ll read on page 3 we’ve recently secured our biggest planning

consent on behalf of a client – a landmark 22 storey building in Peckham. We’re also busy with institutional work having recently concluded sales for the British Red Cross, and another for the NHS at over £5M.

Our Bromley team moved into the Group’s new HQ in February, which as you’ll note from the back page finally brings all of our professional and administrative divisions together under one very smart roof adjacent to Bromley South Station. We have at least two new residential branches due to open before the half year, and we’re recruiting across several key areas of the business; including the Commercial & Development Division.

As always we’re keen to hear from anyone looking to sell or let a commercial property, investment or development site. We’ve got our finger on the pulse in terms of demand and up-to-the-minute values, and we’re always happy to offer initial advice free of charge and without obligation.

I hope this Update proves interesting, and would welcome any questions it might provoke.

OFFICE LETTINGS The state of the office market has varied drastically over the last year or so depending on geographical location.

The previous ‘prime’ market in Central London has tanked as many larger firms moved to home working, and the staff of others were unable or reluctant to commute. In 2019 we concluded several office lettings in SE1 at over £55/sqft, whereas comparable space was available in late 2020 at less than half that. That market is recovering though. Other than tech firms, the vast majority of businesses we’re speaking to fully expect to have all staff back in their offices for the majority of the week at some stage this year. We anticipate a change in working environments, however, with wider desk spacing, flexible meeting areas and more break-out space.

This in turn will generate activity in the sector.

In the suburbs whilst noticeably quieter in terms of the volume of enquiries, we’ve succeeded in locating tenants for the majority of office suites that we’ve been marketing.

Smaller offices are proving particularly popular with firms taking local ‘hubs’, and other businesses and individuals keen to either get out of home, or avoid shared space.

We expect tough times for co-working and hot-desking environments, but plenty of activity for self-contained suites.

Please get in touch if you have surplus offices to sell or let.

2

St. Marks Road, Bromley, Kent BR2 9HG 020 8315 5454

2 North Street, Strood, Kent ME2 4SH 01634 969678

SOUTHWARK SE15 We’re very choosy with the Planning Management work that we undertake, and for good reason. We’re not planning consultants (yet), and we don’t have in-house architects (yet), so our PM services aren’t an attempt to take over the world.

Instead we assist certain clients that don’t have the experience, interest, or time available to manage a project themselves.

We require total autonomy, and potential jobs have to allow us the opportunity to add considerable value – after all, we’re not cheap!

The assembly and promotion of this key island site on the Old Kent Road in Southwark was managed by Tom Luck on behalf of a private commercial investor. Tom invested thousands of hours, and more than £1M of our client’s money in the promotion of the project over the space of 5 years.

Far from being a simple case of securing a planning consent, our involvement included bringing a well-established faith and community group into the project, negotiating the surrender of several leases and employing & managing an entire team of specialist consultants.

Major projects are a marathon, not a sprint, and it was 3 years before we were able to submit a planning application.

A positive resolution was forthcoming in 2019, but it was late 2020 before the S106 was signed and a decision notice issued.

120 Bermondsey Street, London SE1 3TX 020 7089 6555

The scheme comprises 111 residential apartments, more than 22,500sqft of new commercial space and a new 15,000sqft place of worship for the Redeemed Christian Church of God; all wrapped-up in a landmark building over 22 stories.

Our recent sale of the site to a construction-led developer will see the new church delivered for the RCCG, an element of the commercial space handed back to our client and the apartments developed speculatively.

acorncommercial.co.uk commercial@acorngroup.co.uk @acorncommercial

3

CROYDON CR0 We love a consented development site! The strength and reach of our New Homes team enables us to provide prospective buyers with up-to-the-minute sales evidence, which in turn helps us drive land values for our clients.

We sold this warehouse site on an unconditional basis back in Spring 2019, but stayed in touch with the buyers.

Having offered regular advice throughout the duration of their planning applications, we were happy to complete the circle by selling the site once permission had been secured for a smart 9 unit scheme.

In order to maximise value our clients sought a sale of their company, not just the asset. We’ve managed the sale of countless SPV’s over the years, and whilst they become a little more involved, we’re well-versed in the process.

A deal for the share purchase was reached with a developer who’d bought several other sites from us recently, and the matter concluded at a smidge over £142,500 per plot.

REDHILL RH1

We’re undertaking an increasing volume of institutional work, and thoroughly enjoy adding value for charities, trusts, local authorities and other similar such organisations.

We sold a surplus premises in Chislehurst for the British Red Cross last year, and were delighted to be instructed to handle the marketing and sale of another. The redundant building in question was most recently used for offices and training; extending to just 1,100sqft. Whilst occupying a half acre plot, the entire site sits in the Green Belt.

4

St. Marks Road, Bromley, Kent BR2 9HG 020 8315 5454

On the instruction of

The charity’s asset management team anticipated a value of around £200,000, but we were confident of generating a premium given the opportunity to adopt the right marketing approach.

Interest was forthcoming from a variety of occupiers including other charities, veterinary practices, surgery and educational operators, in addition to developers and office users. Bidding was strong, and a sale was ultimately concluded to a commercial buyer at £300,000; much to the delight of the client.

2 North Street, Strood, Kent ME2 4SH 01634 969678

BROMLEY BR1 We reported on a successful joint venture deal in the last Update, but at the same time explained how complicated and time-consuming they can be to arrange. Furthermore with profits ultimately being shared by whatever means, the eventual rewards are rarely what the JV partners hoped they’d be at the outset.

We’re regularly asked to advise on potential JV deals.

The landowner is normally motivated by some form of tax mitigation, whereas the keen developer is the one that typically can’t raise the funds to buy a site outright.

The former applied in the case of this smart site in Sundridge Park. The owner had let the converted Victorian building for many years, and subsequently secured planning permission for the construction of 10 new apartments. Keen to retain ownership and income from the project but devoid of any construction expertise, we were instructed to introduce a suitable JV partner.

After many months of negotiation it became apparent that a joint venture agreement simply wouldn’t work in this particular case. Instead the landowner sought funding for the entire scheme, and the developer we’d introduced secured the build contract.

We’re not just selling agents – we’re problem-solvers too, so if there’s a piece missing from your development jigsaw give us a ring.

SURREY QUAYS SE16

Our involvement with this used car lot adjacent to Surrey Quays Station stretches back many years.

Part-owned by the occupier and partly by a private family, the challenge wasn’t so much whether a sale would be made, but when and by what means.

To the family the property was inheritance, and the proceeds would be split multiple ways. Their sole motivation, therefore, was to achieve the best price. To the owner-occupier though, whilst a sale was appealing it would prove a wrench to leave the site after 30 years, and there had always been a need to relocate the business.

We undertook a marketing exercise in 2019 that generated a host of strong offers, but weren’t able to agree terms to the satisfaction of both sellers. Nevertheless, we remained in touch with the family’s solicitor, owner-occupier and the best bidder, and eventually agreed an unconditional deal in late 2020. Contracts were exchanged expeditiously, and completion took place in March 2021.

At completion we further agreed for South London Car Sales to re-occupy on a rolling licence whilst the new owners explore various options for the site.

120 Bermondsey Street, London SE1 3TX 020 7089 6555

acorncommercial.co.uk commercial@acorngroup.co.uk @acorncommercial

5

IN A NUTSHELL

6

ELTHAM SE9

SUTTON-AT-HONE DA4

Prominent commercial unit just off the busy High Street; let as a shell to a mini market operator on FRI terms at £15,000pax.

Former Baptist chapel and adjoining building with consent for office use; approx 2,700sqft and in need of refurbishment.

Sold for £295,000.

BERMONDSEY SE1

CATFORD SE6

Deceptively spacious commercial unit in a prime spot opposite Tanner Street Park; let to a fashion boutique at £35,000pax.

Freehold warehouse approx.

2,650sqft; sold for £425,000 to a local family business who provide vehicles to the funeral services industry.

DULWICH SE22

SIDCUP DA15

Residential freehold comprising a ground rent, and first floor 3 bedroom flat with consent for extension to create two units. Sold for £570,000.

Commercial unit with wide frontage approx 1,482sqft adjacent to Sidcup Station.

Let to a retailer on FRI terms at £35,000pax.

BERMONDSEY SE1

WELLING DA16

Mid-terrace mixed-use freehold on the ever popular Old Kent Road. Retail unit and 4 bedroom flat producing £53,000pa in all. Sold to an investor at £750,000.

Small unbroken mixed-use freehold comprising barber shop let at £7,200pax, and vacant 1 bedroom flat in the uppers. Sold on behalf of a charity.

St. Marks Road, Bromley, Kent BR2 9HG 020 8315 5454

2 North Street, Strood, Kent ME2 4SH 01634 969678

MEET THE TEAM

Jamie Stevenson Commercial & Development Agency

Louis Markham Commercial & Investment Agency

Steven Flannighan Commercial & Development Agency

Lily Whitby Senior Secretary

Rosie Davis Team Secretary

Adam Miles Commercial & Development Agency

Izaak Thomas Commercial Agency

Jarrel Walcott Projects Assistant

Looking for a new challenge?

If you are interested in joining our team, please contact Jeff East on Jeff East Director

020 8315 5454

Tom Luck Director

REPORTS IN THE NEXT ISSUE...

M

HA

EN

D SY

C

HI

EW

T RS M CA

120 Bermondsey Street, London SE1 3TX 020 7089 6555

L

EL

RW

BE

H AT

HE

Y LE

X

BE

N

HU

E SL

SS

O

CR

RD

O

F RT DA

acorncommercial.co.uk commercial@acorngroup.co.uk @acorncommercial

7

TW

EE

DY

RO

A

BROMLEY NORTH

D

S

H

E

R

M

A

N

R

O

A

D

HI

Our previous office

G H ST

R

WIDM

OAD ORE R

E E

A

D

T

UR

CH

RO

AY KENTISH W

CH

HI

GH ST

RE

ET

EL

A

N

D

RO

AD

Staff have more space, bigger desks, better amenities and the ability to host physical and virtual meetings with private and corporate clients in a range of different environments.”

9 St Marks Road, Bromley BR2 9HG 020 8315 5454

acorncommercial.co.uk commercial@acorngroup.co.uk @acorncommercial

L

Decades of experience has shown us that estate agency remains a people business. This is reflected in our new head office which is an investment in our own people. The building is equipped with the state-of-the-art technology to ensure the safety of staff and visiting clients, including a cutting edge ventilation system and automatic temperature checks on entry.

IL

Acorn Group CEO Rob Sargent confirms “This new HQ sees one of the biggest and most diverse concentrations of property professionals under one roof outside of central London.

H

long-standing quest for us to be able to house every Division and administrative department of our business under a single roof. In addition to the Commercial & Development Division, colleagues from our New Homes, Property Management, Estate Management, Financial Services, Surveying, Lease Extension, IT & PR Divisions are based at the HQ.

S

S

R

N

E

O

SO

W

TM

Our previous office

A

Our Commercial & Development Division was instrumental in acquiring the site almost a decade ago, and has provided invaluable consultancy advice ever since. In addition to serving as one of the tallest buildings to have been constructed in the London Borough of Bromley, the project satisfies a

BROMLEY SOUTH

M

We’re excited to announce that our Bromley team moved to the Acorn Group’s brand new, custom-built headquarters at Bromley South in mid February 2021. Our new offices extend to over 14,000sqft, and occupy the lower four floors of a striking 17 storey, landmark building delivered by The Purelake Group.