March 15, 2019
Property sector seeks to weather the storms – five thoughts from MipimContact
By Jeremy Durrant, partner and co-lead of the real estate and construction team
Headwinds and high winds were among the topics dominating the chatter on Cannes’ La Croisette for the annual gathering of the property world at Mipim this week.
Many delegates suffered a bumpy start as the strong gusts which accompanied the late afternoon sunshine of Monday saw planes take several attempts to land at Nice airport or divert elsewhere.
However, undeterred as the show opened on Tuesday, attendees were out in full force and several veterans of the Palais des Festivals et des Congrès that I spoke to said it was as busy as they had seen it.
Below are five post-show conclusions I left with having spoken to clients, media and other businesses in attendance.
Real estate, like many sectors, craves certainty in whatever form it comes. So the collective groan was almost audible across the Cote D’Azur as Theresa May’s deal was voted down a second time. Discussions weren’t around the merits of remain or leave just a desire for detail on a destination.
Nearly 6000 people from the UK were in attendance in Cannes and all of them will have at some point during the three-day event acted as quasi-spokespeople, fielding questions from European or international counterparts who were seeking an explanation to the unprecedented scenes at Westminster. It was a mix of casual curiosity and more deep-seated concern. In contrast, the Spring Statement barely registered.
This is an investment gathering and deals are there to be done. The commercial real estate sector in particular has proven itself resilient these past few years as investment cycles often outstrip political short-termism. So there was plenty of talk of potential capital to be deployed and indeed Cushman & Wakefield announced that global real estate transaction volumes in 2018 were the strongest on record reaching US$1.75 trillion; a 4% year-on-year uplift. That said it is also worth noting that Brexit is not the only headwind facing the sector. Macro-trends from the US through to Asia coupled with regulatory-driven issues such as climate change will shape future strategy.
From a regional perspective, the UK was well represented via the dedicated London area as well as through delegations from Leeds, the West Midlands, Scotland and others. Special mention should go to Liverpool for its stand. Its in-built tiered audience seating meant for an inclusive feel to presentations and ensured a constant, busy hum emanated from that part of the hall.
Elsewhere, other parts of the world literally set out their stalls. There was strong competition from cities across Europe and beyond seeking to catch the eye of would be investors. Now more than ever, the UK needs to portray its business case and keep doing so.
This was the 30th anniversary of Mipim. The 29th edition of the show last year occurred in the aftermath of the Presidents’ Club scandal and as a result, microscopic attention was aimed at uncovering further bad behaviour or pre-historic attitudes at the 2018 conference. A year-on and the fervour was not the same but clearly – and rightly – it remains a lingering topic of conversation. Many businesses were still conscious of the reputational risk of being associated with the event and no doubt standards of professionalism at all times would have been drilled into those attending.
Opportunity randomly knocks
It can seem counter-intuitive to travel all the way to the South of France to meet people who may very well be on your door-step in the UK. However, the great advantage of Mipim is its networking capability and ability to bring people together. For all the pre-show planning and targeting, it is impossible to factor in the random moments. One such moment occurred as I sat sipping a coffee at the show shortly before departing for the airport. Some 10 minutes previously, a man had politely asked whether he could sit at the spare chair at my table in the thronging café area. A short while later, after a bit of eavesdropping on his behalf, we were chatting on the Build-to-Rent part of his business and how PR could help elevate his brand and proposition. Contact details were swapped and no-doubt follow-up will occur.