In this episode ...
Episode introduction:
In this episode of TLD Talks Ed Simpson, CEO of The Legal Director, talks with Client Legal Director Joanna Alexander, and Mark Nock of real-estate consultancy Compton Rose about the commercial property market and how it has evolved and changed as a result of the Covid pandemic.
Today’s guests:
Joanna Alexander is a practical and experienced solicitor dealing with all aspects of commercial property law. She has acted for clients including the Swatch Group, David Lloyd, Costa Coffee, Krispy Kreme, the Royal Bank of Scotland, The Bank of England, and the YMCA. Mark Nock is a chartered surveyor and owner of Compton Rose, a consultancy which covers property matters including acquiring properties, restructuring leases and project management.
Main topics:
- Mark on how the Covid pandemic has affected the commercial property market, for example changes to e-commerce, warehousing and logistics, and hybrid working. (01’45)
- Joanna on what she’s seen in the retail sector as a result of the pandemic, including turnover-based rent in leases. (02’34)
- Mark on the impact of hybrid working and how the office environment is different. (03’26)
- Is the ESG agenda affecting office and corporate space? (04’06)
- Joanna on whether occupiers are looking at their commitments under their leases differently, including authorised guarantee agreements, and break clauses. (04’41)
- The changes to leases that Mark is seeing with offices, including flexibility and exit costs. (05’58)
- How tenants are looking for more flexibility in their lease, and how their requirements are changing. (07’04)
- Are other changes here to stay? (08’19)
- Joanna on the demand in the warehouse market. (09’07)
- Ed, Mark and Joanna on whether people will want to go back to working in an office. (09’28)
- Joanna on the changes she’s seeing in documentation associated with leases. (10’49)
- Mark on changes being made to office space and how to do this properly. (12’22)
- Rent reviews and whether Joanna and Mark have seen changes to the way these are being handled. (13’32)
- Joanna discusses retail clients asking for break clauses in leases. (14’39)
- The importance of understanding what’s driving the landlord in order to get the best deal. (15’46)
- Joanna’s experience of working with a client to negotiate a rent reduction. (16’21)
- How are dilapidations discussions being approached and what advice do you have for CFOs dealing with these on exiting a lease? (16’58)
- Are there any areas of constraint in the market? Mark discusses a shortage of warehouse and logistics space, and an increase in office take up. (18’54)
- Joanna discusses a shortage of good space in shopping centres and the competition for this space. (20’11)
- How do you see the commercial property market continuing to evolve? Joanna discusses events in Ukraine and Russia and their impact. (21’00)
- Mark discusses the impact of inflation on the property sector. (22’15)
- Does Joanna see further changes in how people do their shopping? Joanna discusses the relationship between shops and the office sector. (22’46)
- How is sustainability and net zero affecting the sector? (23’46)
- What should CFOs or property directors be doing now to prepare for the changes that have been discussed in this podcast? (24’56)
- Mark on real estate continuing to be factored into the overall business strategy. (26’07)
- Joanna on the increased time for supply of materials. (26’43)
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