Mills & Reeve: Property Matters

Our second Exciting Disruptors event explores a new way of living and working

On 3 October, we will be hosting our second Exciting Disruptors event with Bruntwood and NORR Architects at Platform in Leeds. We will be exploring how traditional forms of living and working are a thing of the past and discuss how the real estate sector is adapting to meet the needs of new type of customer.

Bruntwood and NORR Architects will discuss how they have identified the demand to change how we live and how they continue to evolve to be more competitive, agile and customer focused.

The event will also cover the increased focus planners and developers have on the mental and physical wellbeing of occupiers in the workplace.

Guests will enjoy an early evening of fascinating presentations, a tour of the building and networking with drinks and canapés.
For further information and to register your place, please click here.

PlaceTech, a media platform for explaining technology to property people.

Mills & Reeve is the legal partner to PlaceTech, a media platform for explaining technology to property people. The target audience is the full range of disciplines active in the UK property market, at every stage of the process including planning, architecture, construction, marketing, sales & lettings, investment, management, placemaking, transport and user experience. We will be joining Bruntwood, Manchester Science Partnerships, OBI Property and Redwood Consulting as partners.

The PlaceTech platform is to bridge the gap between tech and property and will provide tangible examples of technology in application, explaining how it works and relaying the benefits. PlaceTech will champion innovation and encourage collaboration to drive adoption and create a more productive, better connected property technology movement. This partnership fits in line with our Exciting Disruptors campaign and we see this complementing our ‘Future of Real Estate’ focus.

Access the PlaceTech platform here.

Important Information For Landlords With Telecoms Leases: New Electronic Communications Code in force from 28th December.

The Digital Economy Act 2017 (Commencement No 3) Regulations 2017 bring the new electronic communications code into effect on 28th December with some significant changes for landowners to be aware of.

The new code will apply to existing agreements subject to some complex transitional provisions so it will affect you even if your telecoms agreement has been in place for many years.

In general the new code is like the old in that there is no guarantee that an owner can obtain vacant possession at the end of the agreement.  An owner who doesn’t want to enter into a code agreement can have the rights forced upon them by a court order.

By way of reminder the main differences between the old code and the new are:

1. A fall in rents owing to a different valuation procedure.  When valuing the land you assume that there is no operator who wants to use the land for electronic communications services.  The government’s view is that the owner ought not to have a “a share of the economic value created by very high public demand for services that the operator provides”.
2. The operator can upgrade equipment on site and share occupation of the site without the owner’s consent.  The operator can assign a lease without the landlord’s consent though the landlord can require the assignor to give an authorised guarantee agreement in respect of the assignee.
3. The agreement must be in writing.  Both parties must sign it and the agreement must set out the length of the contractual term and any contractual notice period.
4. There is no statutory “lift-and-shift” provision.  However, the agreement can contain a contractual provision.
5. A landlord is not bound by any agreement into which their tenant enters unless the landlord agrees to be bound.  If the operator does not remove the equipment at the end of the agreement, the landlord must obtain a court order compelling it to do so.  This is so even if the landlord is not bound by the agreement.
6. The Landlord and Tenant Act 1954 does not apply to code lettings.
7. Code lettings have security of tenure similar to the 1954 Act but you cannot contract out of the Code

It will be some time before we can assess the impact of the changes to the electronic communications code but, as anticipated, it is operator friendly and careful consideration should be given by landowners before entering into any agreement which may be caught by it.

Andy Burnham launches the Greater Manchester Town Centre Challenge to revitalise and reshape town centres across the region.

Exciting times are ahead for Manchester as the Mayor of Greater Manchester announced his plans to regenerate the region’s town centres on 17 November 2017.  Andy Burnham’s regeneration initiative is seeking to move “.. away from the developer-led, greenfield first approach of the past” with the objective of delivering more high density residential developments with retail and leisure facilities on brownfield land which is supported by transport and digital connectivity.  Andy Burnham said “This new initiative is all about regenerating town centres across  Greater Manchester which have felt left behind”.   At the launch event in Bury town centre, Andy Burnham spoke about his desire to work with each council to bring together housing providers, public and private landowners, developers, community groups and other key stakeholders to unlock the potential in town centres to support the town centre challenge.

The Mayor stressed that whilst there is a huge housing requirement across the region, Greater Manchester needs a housing and planning policy which is not just about the number of units built, but one that is focused on building the right homes in the right places.   He stressed that the high levels of traffic congestion in the region meant that new housing growth would only be supported if it is linked more closely to transport infrastructure.  

It is thought that Greater Manchester may well follow London’s  lead in its new approach to redeveloping existing shopping centres to deliver new homes.    Approximately, a third of London’s shopping centres are currently subject to redevelopment plans which include a residential element as part of the proposals.  Greater Manchester has around 50 shopping centres , all of which are located in areas with good transport links and therefore have the potential to offer the opportunity of delivering the required high density developments.

With over  8 main towns, around 20 other smaller towns and more than fifty significant suburban centres, this new initiative is no mean feat but the Mayor is taking one step at a time and has invited each of the Greater Manchester boroughs to elect an initial one town centre to be improved to kick-start the regeneration. These nominations are due to be in before the new year. 

Here at Mills & Reeve we are excited about this alternative and creative initiative and look forward to seeing the results of the town centre challenge.

 

Exciting Disruptors – the future of real estate

Disruptive innovation is making an impact on the foundations of the real estate industry and at a pace. Businesses and governments are having to embrace a myriad of developments, in terms of technological advances and social change, or risk falling behind. 

Exciting Disruptors identifies new and emerging trends affecting the real estate industry today and in the future. At Mills & Reeve, we work with clients at the forefront of emerging technologies and recognise the importance of being able to advise our real estate clients on issues that will affect the future of the built environment.

On Wednesday 8 November, we will be launching Exciting Disruptors at an event in London which will explore how autonomous vehicles are set to challenge and influence our approach to infrastructure planning, real estate investment, place making and how we plan new settlements and urban extensions.

Guests will enjoy an early evening of interesting presentations and panel discussion comprising speakers from the Government's Homes and Communities Agency, Bosch, EasyMile, First Group and Mills & Reeve with more exciting announcements to be made soon!

For further information and to register your interest for the event, please click here

Written by Michelle Hunt

Planes Trains and Automobiles

Lots has been said about the combined HS2 Leeds station and its significance to the growth and development of the South Bank area of Leeds as well as the city and region as a whole.  It is important however to consider other infrastructure developments locally and the plans that are underway to further develop transport networks to keep Leeds in the running.

The new train station at Kirkstall Forge opened in June 2017 and will play a major role in supporting the development of commercial, residential and retail space for the economy of North West Leeds.   The Kirkstall Forge scheme will create approximately 2,400 new jobs and with the recent reserved matters planning application for 112 new family homes and 23,000 sq. ft. of retail, leisure and community space set around a new public square, will revive a site with an 800 year industrialised history. 

The proposed Parkway station is also a big win.  The Department of Transport gave support for funding of this project back in the Spring and Leeds City Council’s executive board have recently given approval to the outline scheme with a feasibility design now being carried out for the station.     Once developed the station will create better connections to Leeds Bradford airport which is used by 3.5 million passengers a year and contributes £100m annually to the city region economy.  The station is also intended to act as a park and ride hub to support commuters to Leeds and Harrogate and will provide much needed support to the daily rush hour.

Connectivity does not stop here and there are also proposals for two new train stations in addition.   The station proposed at the White Rose shopping complex, (which over recent months has been extended to include a further 65,000 sq. ft. of leisure space), will support retail, leisure and office connectivity and promote employment and further growth and opportunity for the South Leeds area.   Proposals to build a station and park and ride hub at Thorpe Park on the other hand will focus on enhancing the existing established business community of 4500 people as well as support housing growth in East Leeds.

It is clear looking at the infrastructure development that has taken place and the proposals that exist to develop new transport networks that not only is there a commitment to connect people to growth areas in the Leeds economy but in addition to grow the Leeds economy through better connections to it.

A sledgehammer to crack a nut? Government plans to scrap ground rents on houses

Who would have thought that ground rents would ever be the lead story on the Today programme?  But so it was this morning as the BBC reported that leaseholds on new-build houses would be outlawed and ground rents dramatically reduced under government plans. The BBC quoted Communities Secretary Sajid Javid as saying "Enough is enough. These practices are unjust, unnecessary and need to stop".

Tales of home owners who have found themselves with bills for huge ground rents or who have had to pay for consent before carrying out works to their homes, have recently caught the attention of consumer programmes and the national press.  Whenever I hear these stories on the radio, I ask myself (or shout at the radio!) “Didn’t you read your lease before you bought your house?” or “Didn’t your solicitor tell you about this before you bought?”.  It will all have been there in black and white before these buyers signed the contract.  Was it brought to the buyers’ attention before they committed to the biggest financial commitment in most people’s lives?  Or has the fact that conveyancing fees have been driven down over the last few years to such ridiculously low levels meant that there is no longer time in the conveyancing process to report to clients on the terms of the leases they are signing up to? 

Perhaps the buyer has been properly advised but feels pressurised to exchange contracts on their new build purchase through fear of losing their reserved plot and the reservation fee paid to the developer if exchange doesn’t take place within the 4 week window which, in many cases, is all prospective home owners are given.

There are very good legal reasons why we need leasehold structures, including the enforceability of positive covenants.  In the “good old days” referred to on the radio this morning when most houses were sold on a freehold basis, local authorities were prepared to take over the common areas of new estates once the houses had been sold.  Increasingly, this is not the case as local authorities do not have the resources to take on this financial burden.  So the maintenance obligations may have to sit with a private management company who will need to charge a ground rent to pay for this (and, inevitably, to make a commercial profit).

Perhaps we need to think about restricting how much this type of ground rent can be increased. After all, how much bargaining power does a purchaser really have in negotiating lease terms if there is strong demand for the property they have reserved because of the housing shortage?

Or do buyers need to be willing to pay a bit more for conveyancing fees so that they make sure they only buy once they have been given all of the facts and understand exactly what they are taking on?

Cambridge – a city in transition

Traditionally, Cambridge attracted small to medium sized businesses who sought to avoid the expense and saturation of the London market. Equally, the region is well known for its vast agricultural offerings and picturesque villages.

However, there is a ‘new’ Cambridge on the block which is rapidly becoming an inspiring hub full of modernisation and productivity. The region has always been full of potential but now it seems that Cambridge is gaining recognition as a powerhouse to rival London.  The recent Dynamic Cities Index compiled data on 130 cities in Europe and scored each city in categories such as innovation, inspiration, inclusion, interconnection, investment and infrastructure. Cambridge was ranked third overall on that list – behind Paris (second) and London (first). To many this may come as a surprise, yet, the people who live and work in Cambridge have seen a number of high profile organisations set up shop in the area over the last decade. These include Microsoft, Darktrace and more recently, Apple and the relocation of Astra Zeneca’s head office.

These big name brands have resulted in a surge in demand for commercial and residential development – which the region encourages and gladly obliges. A quick glance over the Cambridge landscape and you will see projects such as the Cambridge Biomedical Campus, the Innovation Park and the North West Cambridge and CB1 developments in full flow. Despite the recent modernisation, practitioners are noticing the ever present commitment the region has to local businesses – who, in turn, are seizing the opportunities by expanding and diversifying their portfolios.

Driverless Cars make appearance in the 2017 Queen’s Speech

The Queen’s Speech this week may have attracted criticism for not containing many policies, but one proposal will be of interest to consumers and real estate professionals alike. The Automated and Electric Vehicles Bill contains plans to push driverless car technology and to encourage the use of electric and self-driving cars.

Many concerns have been raised about the safety of driverless cars and the Bill includes an extension of car insurance to cover the use of autonomous vehicles so that compensation claims can be paid quickly in the event of any accidents. The Bill also allows the government to require the installation of electric charge points for electric vehicles at motorway services, and large fuel retailers to increase the uptake in usage of the electric vehicles. Although these proposals focus on petrol stations, query whether in future charging points will be situated elsewhere (i.e. in other public car parks; retail parks etc.) meaning the death of the petrol station as we know it, potentially releasing many parcels of land for redevelopment.

It is hoped that this bill will increase the interest and support of the driverless car revolution. It is essential that a legal framework is put in place for the driverless car concept to be a success, to increase public confidence and ultimately improve safety on our roads. The government’s aim is to support manufacturing and innovation by allowing driverless cars to operate in the UK, making us a world leader in this field. There are already several on going trials of driverless cars; with the government investing further in research and testing infrastructure. The impact on town planning and infrastructure from mass take-up of autonomous vehicles also cannot be underestimated and there is great scope here for real estate professionals to influence the debate.

The road ahead may be long but the Automated and Electric Vehicles bill is definitely a step (or, more accurately, drive) in the right direction.

 

Mayor of Cambridgeshire and Peterborough: What does it mean for real estate in the region?

Cambridgeshire and Peterborough’s new mayor, James Palmer, now oversees a budget of almost £800 million (over the next 30 years) to shape the region’s economic, housing and transport strategies.  Palmer has outlined immediate priorities for his first 100 days in post.  So what does this mean for real estate in the region?

Transport and Infrastructure gains?

Palmer has pledged to better connect the Eastern region both internally and with neighbouring areas.  He hopes to upgrade the A10 and A47 to encourage economic growth in the Fens and commit £27 million to develop the Oxford to Cambridge Expressway road links, further cementing Cambridgeshire’s position in the ‘knowledge corridor’.

Throughout his campaign, Palmer prioritised investigating the practicalities of an underground metro and/or light railway network in Cambridge, which could revolutionise transport in the city.  He hopes that decreasing congestion and using sustainable methods will attract businesses looking for an alternative to ‘Silicon Valley’.

Despite voicing concerns about the Greater Cambridge City Deal – most notably the guided busway and the workplace parking levy in Cambridge city centre – the mayor is already working alongside City Deal representatives, to assess a range of possible options.

Outlook for Development

Drawing inspiration from developments like Cambourne and Hampton, Palmer wants to use innovative methods to speed up development projects, make the planning system more accessible and bolster investment into the region, whilst also preserving the Green Belt.  However, the new mayor stresses that choosing sites for new developments remains with the City Council.

In an attempt to tackle spiralling prices and demand, Palmer aims to diversify the Cambridgeshire housing market.  He has plans to open a mayoral housing fund to small and medium enterprise builders, creating houses for rent and enabling local communities to build and own homes via Community Land Trusts.  As a starting point, the devolution deal provides him with £170 million for affordable housing, £70 million of which is earmarked for meeting housing needs in Cambridge.  Palmer also wants to cultivate growth in the region’s established communities and has prioritised developing a masterplan for St Neots.

How things develop over James Palmer’s first 100 days in post remains to be seen.  We are intrigued to see how much of his vision becomes reality and what impact this has on real estate locally.

Written by Hannah Lewis