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Prime London Central Residential: Is the bubble about to burst? A Presentation by London Central Portfolio, Residential

Prime London Central Residential: Is the bubble about to burst? A Presentation by London Central Portfolio, Residential Funds and Asset Managers. Looking at PLC residential as a commercial asset class. The past…the present. The future?. The elephant in the room. Risk Warning

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Prime London Central Residential: Is the bubble about to burst? A Presentation by London Central Portfolio, Residential

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  1. Prime London Central Residential: Is the bubble about to burst? A Presentation by London Central Portfolio, Residential Funds and Asset Managers

  2. Looking at PLC residential as a commercial asset class The past…the present... The future? The elephant in the room Risk Warning Views and opinions expressed in this presentation are those of London Central Portfolio Limited and do not necessarily represent the views of any third party associates who in no way warrant the accuracy or completeness and accept no liability for any direct or consequential losses arising from its use. There can be no assurance that current market conditions will remain in the future. Past performance does not guarantee future results. Actual results may differ materially from the forecasts/estimates. Views, opinions, trends and prices expressed are subject to change without prior notice and are expressed solely as a general market commentary and do not constitute investment advice or a guarantee of returns.

  3. 23m residential units Notthe UK… 63.2m people 61,840 sq. miles Average price £238,293

  4. Not Greater London… 12.5% UK population 8m people 33 boroughs Performance closely correlated to the UK

  5. Not...Canary Wharf, home of Multinationals Not...the “East End”, home of the Olympic Village 11,430 Planning permissions. Average price £370,500 19,574 Planning permissions. Average price £231,296

  6. It is Prime London Central…the home of... 5,000 transactions p.a. 184,308 units 613 under construction 378,045 people Average price £1,359,736

  7. Made up of numerous ‘villages’ around Hyde Park… …It is the “bullseye” of the capital

  8. The long term… Globally desirable Go-to destination International centre Low dependence UK economy Irreplaceable architecture Highly demanded asset backed investment

  9. London Residential – A Capital Growth Asset Prices have increased over 65 times since 1969 Capital Growth Since 1969 Source: CML, ODPM, OCLG Past performance is not a guide to the future

  10. The short term… A robust performer in volatile markets London Central vs FTSE 100 (Q3 2007 = 100)

  11. A strong story to tell in all market conditions… Performance of gold versus London Central (1995= 100)

  12. To many foreigners, Central London is ‘cheap’… £ ‘cost’ of Central London property based on different exchange rates (Oct 2007= 100)

  13. The scares resource: Volumes fall by 59%… Annual actual transaction volumes from 1996 9111 5365 In 2010 HNW population was 10.8m: 2000 buyers for each London property

  14. Current growth is spot on long term trend… 9% p.a. London Central actual growth versus long term average growth (1995= 100)

  15. Significant Growth Projected LCP (36%) Anticipated price growth for Prime London Central residential property JLL (30%) Savills (+19%) Index 2012 = 100 Knight Frank (+18%) Source: Jones Lang LaSalle 'On Point', Savills Residential Research, Knight Frank Residential Research

  16. Central London is not just for the globally rich… Social Housing: 25% versus 18% Empty Homes: 1.4% vs 1.1% Young, between 25 – 44: 40% vs 27% Private Rented Sector: 38% vs 17% Cosmopolitan Not Born in the UK: 53% vs 13% Second Homes: 5.6%

  17. New residential property taxes... 7% for £2m+ Annual Tax For Enveloped Dwellings 15% for £2m+ for certain NNP’s Capital Gains Tax Carve-outs Good News For Investors …For Now!

  18. But more taxes in pipeline…

  19. GDP in Westminster > any other London borough £100,000 students at world top universities PRS contributes £1.5bn p.a to economy and £0.5bn to the Exchequer Tourism and night time economy: 8bn p.a.

  20. Many drivers for growth in PLC... Global capital – the jewel in the crown Our 6th biggest “import” Tiny in terms of size Enormous in terms of impact Long and short term indicators do not suggest a bubble, but continued buoyancy

  21. Long and short term indicators do not suggest a bubble, but continued buoyancy

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