The weather was much warmer in MIPIM this year – with no sign of the snow and rain that had plagued us last year. This made standing outside Bar Roma into the small hours of the morning a far more enjoyable affair! The warmer weather was also in keeping with the more upbeat mood of the MIPIM attendees, many of whom seemed optimistic about UK market prospects.
Foreign investment
At the more exclusive lunches and dinners hosted by London First the focus was on the London market being seen as a 'safe haven' for many investors, particularly from Eastern Europe and Asia. Boris Johnson may want resident UK buyers to have first refusal on the capital's properties, but the fact is that developments like the regeneration of the Battersea Power station site attract massive overseas interest. Over 800 residential homes have already been sold offplan, generating £675m – with further sales in the pipeline. No doubt we will be reading considerably more about this issue over the coming years in a buoyant market environment.
A word of warning
Participants at a number of MIPIM gatherings commented that London should not take its safe haven status for granted. While London retains its position as a leading financial centre with a relatively stable political and legal environment, too much talk of levying extra tax on non-residents, e.g. CGT on non-residents holding UK property, an annual tax on 'enveloped' dwellings and a possible mansion tax, could take the gloss off the city's standing – enabling locations such as Manhattan and Singapore, which are waiting in the wings, to take advantage.
Boris was certainly happy to announce that London has now risen from the sixth to the fourth largest French city (a reference to the number of French nationals in the capital), no doubt thanks to a penal tax regime rolled out by the French premier Francois Holland – a lesson to be learnt!
Life beyond London
A number of leading observers also believe that the ripple effect out of London is beginning to be felt, with a number of large secondary cities starting to show signs of improvement in the marketplace. We should not forget that much of what happens in London in terms of property development creates employment and production in other cities. In fact, more than 20 UK local authorities were represented at this year's MIPIM, no doubt aware of future prospects and opportunities for their regions.
To summarise, the general view from MIPIM is that the UK property market is truly on the road to recovery, with many observers even bullish about the future. At the same time, we would do well not to forget too quickly the dark days of the property crash, which are hopefully behind us now.
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