11/14/2013 | By Mitch Irzinski
Liz Peace, chief executive of the British Property Federation, joined REIT.com for a video interview at REITWorld 2013: NAREIT's Annual Convention for All Things REIT at the San Francisco Marriott Marquis.
Peace discussed how the office sector recovery in the United Kingdom has compared to the United States.
"I think the whole U.K. recovery is a very sort of mixed patchwork, as we would call it," she said. "It depends very much on where you are and what kind of property you've got. So, basically, the grade-A stuff is doing pretty well, particularly in London, be that office or retail. It's doing very well in a number of the regional cities that are big and prosperous. It's not doing terribly well in the secondary locations."
Peace also described the effect of the 2012 Summer Olympics on the London property market.
"I think the Olympics were great for confidence generally," she said. "It's difficult to point to very specific property effects, but one particular one has been a big fill-up to the residential market, because the area that was athletes village - we're talking about 2,800 units - is now coming into the market. One half of it is going to be entirely market rent, so I suppose it would be the equivalent to what you would call a multifamily facility. The other half affordable housing, being run by a housing association. So, the multifamily half of that is giving that whole sector a real boost because people are now seeing a large-scale rented operation as being something that's feasible."
Peace also talked about the regulatory developments she will be keeping her eye on in the next year.
"The one we're actually quite worried about at the moment is the whole approach to high-end residential, particularly in London, who's actually buying it," she said. "The government has put a couple of things possibly on the agenda. The Coalition Partners, our liberal democrats, are very keen on the idea of a mansion tax, which would be a one-off annual payment on big houses over a certain size. That I think has unnerved the property industry quite a lot. They're very concerned about the impact of that, and we've been looking at possible alternatives."