EG 18-05-19

p.33 Dire results for Landsec and British Land as a result of their exposure to retail. Values of their holdings in retail parks and shopping centres have fallen 12-15%. BL is offloading retail parks. Both are investing in flexible working products.

p.34 A survey of ‘who owns the High St” reveals that overseas investors are fast becoming one of the biggest owners, almost a fifth of shops are owned by overseas investors. As a group they are the biggest owners after UK REITS and propcos. Public sector comes in third.


P.57 The ‘Economic Substance Rules’ came into effect on 1-1-19 and they can apply to, banking and finance companies tax resident in Jersey,  but not Propcos (but possibly their holding companies, 'Holdcos’. If affected they may need to show that they are directed and managed, are generating income and have physical assets and people  in Jersey.

P.60 Looks at the planning landscape for ‘Build for Rent’ schemes. These are becoming increasingly popular. NPPF contains various guidance/requirements such as 20% affordable, minimum discount on affordable of 20%, eligibility for affordable to have regard to local income levels and councils to have the right to make suggestions but NOT nomination rights, clawback if BTR units sold, etc. Looks at experience in London, and the general need for early engagement with planning officers.

P.62 Looks at Co-op v Shah Properties  [2019] EWHC 941 L&T(C)A95 case on AGAs & sub-guarantees by T1’s G’tor. Was a g’tee in a licence to assign enforceable - High Court said yes, but this decision is only High Court and may be document/facts specific.

P.62 Unequal service charge split upheld in a case of astonishingly bad lease drafting for some flats. The tenant-owned landlord was unsuccessful in persuading the court to exercise its powers to vary the lease under s.35 L&TA87 where a lease fails to make satisfactory provision or repair and maintenance, for the provision of services, insurance or recovery of expenditure or computation of a service charge.

P.63 From AST to sorry tale. Must read for anyone who thinks BTLs are easy money - L found T had erected subdivisions to create more bedrooms and was renting it out on Airbnb through some shady company structure! Getting possession wasn’t straightforward and it outlines  the nightmare of complexity L’s solicitors had to navigate to get possession.

P.64 Impact investing. This one went over my head and is something about investing in things that have positive social and environment impact.

P.65 Short term relief from forfeiture. Old BHS store in Bristol, on a peppercorn rent 125 yr lease, bought for £7M by BHS. Landlords forfeited for being in breach of ‘keep open’ covenant. The lender and tenant in liquidation sought relief from forfeiture, but the Landlord alleged that they didn’t come to the court with clean hands as there had been what the judge felt bordered 'between hard commerce and fraud’ (!), but the judge gave them three months to find an assignee, as Sports Direct had shown interest.  But if not, then the landlord will get the property back 100 years early and could do a deal with someone like Primark! Wheels within wheels..
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