Real estate trade bodies in the UK are stepping up efforts to ensure Brexit does not endanger their industry.
In the week that the Supreme Court ruled that the government could not start the exit process without parliamentary approval, the Property Industry Alliance (PIA) and British Property Federation (BPF) both outlined the key elements of their Brexit-related lobbying.
Both the BPF and PIA, which includes the BPF among its members, have separately revealed two sets of priorities; they differ slightly, but both point to the importance of maintaining business and investor confidence.
In its “Brexit manifesto”, the BPF has stressed the importance of working in partnership “to maintain business confidence and drive economic growth”, while PIA said overseas investment in UK real estate is “highly significant driver of [gross added value] and productivity, and must not be put at risk by Brexit”.
The BPF and UK property company Grosvenor also published the results of a survey that suggests confidence in the UK economy has dropped significantly. The two organisations surveyed the BPF’s membership and said the results suggest “uncertainty around EU exit negotiations could be the most significant factor causing the drop in confidence since last year”.
One-third of respondents expressed confidence in the UK’s economic prospects for the next 12 months, compared with 88% of those polled in last year’s survey. More than four-fifths believe uncertainty caused by Brexit negotiations will be the top challenge to the sector as a whole.
At a roundtable meeting in London on Monday, hosted by Oxford Properties, BPF policy committee members stressed the importance of engaging with the government ahead of its EU negotiations.
Paul Brundage, executive vice president of Oxford Properties, the real estate arm of Ontario Municipal Employees Retirement System (OMERS), was among those calling for the government to ensure a stable economic and investment environment.
He said OMERS had made a long-term commitment to make the UK its biggest market for private investments outside North America. While the Canadian institution will maintain that commitment, Brundage admitted that the decision had been based on conditions that could be put at risk by Brexit.
Melanie Leech, chief executive of the BPF, said: “The decisions that will ensure the infrastructure for a strong UK economy in the future need to be taken now.
“There is much the government can do to give confidence to investors – by demonstrating its commitment to working with us in partnership, by maintaining a fair and stable tax system and ensuring an efficient planning system.”
Bill Hughes, head of real assets at Legal & General Investment Management and chairman of PIA, said: “Real estate is a critical and enabling part of the UK’s economy, shaping our towns and cities and channelling productive investment into the real economy.”
He said it was “critical that we do not sit and wait to see what a post-Brexit world might look like”.
Matthias Thomas, chief executive of Investors in Non-listed Real Estate Vehicles (INREV), recently told delegates at a roadshow event in London that INREV will form a cross sector committee to address implications of Brexit.