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In more than two centuries in the business, there are a few things that have remained constant for the British real estate services firm Chestertons. A belief in the inevitability of change is one of them.
This year marks another important transformation for the upmarket property specialist following a rebrand-ing a few months ago and an impending change of ownership in December.
"I think everyone feels we are now entering the next stage of our development," Robert Barlett, Group CEO of Chestertons, tells PW.
He says the transformation will include a much broader and strengthened presence in the region. Here's an excerpt of the interview.
Tell us about the company's history?
Chestertons was originally founded in 1805 in London and evolved into managing estate in London on behalf of the Crown, church commissioners and various other big traditional institutions as well as wealthy families. At one point, it had 158 offices in 36 countries around the world.
Early 2004-05, the company had financial difficulty and sold a lot of its businesses. We reacquired the business and kept the focus purely on residential property. We took over the business in 2005 and had nine offices in central London at that point. Now we've got 30 offices in London and about 21 offices overseas.
How long have you been with the business?
I've been running the business since 2005. In the time that I've been with the business, we've grown by more than 500 per cent.
The company is now looking for bidders. How will it affect the business?
Part of our ownership structure is through a private equity house and they are at the end of the current fund that they invested into the company and they are obviously looking to sell their shareholding in the company. We're expecting first-round bids in the middle of October and a final bidder could be selected around December. From a business perspective, it's business as usual.
Can you talk about your Dubai presence?
We developed our Dubai business by focusing heavily on the professional services side. By 2009, the London residential market was starting to grow quickly again, so we started approaching developers such as St George and really leading that market in coming back to the Middle East. None of the big UK developers had really tested the Middle East market.
We now have a full-service local residential and commercial sales and leasing team. In the past 18 months we've grown from about 12 people in the UAE to just over 50. We've just expanded our office in Abu Dhabi, with about eight people right now. We're in discussions with partners to open in Saudi Arabia.
You're also in Spain now.
We've specially opened an office in Marbella because of the Middle Eastern interest in that specific part of Spain. We constantly look for international markets where Middle East buyers want to invest in property. We then go into those areas to provide that service to them.
What projects are you bringing to the UAE?
London Dock is a very exciting new development from St George, in what was famously called the News International site at Wapping. It's a huge development with nearly 3,000 residential units. Reception has been very good. We set a sales target for the next two months, and actually exceeded that target in the first week.
What is your advice to investors looking at London?
My personal advice at the moment is to look away from prime central London, where values are starting to steady out. I think there'll be very limited price growth there for the next 12 months, partly because of the elections due in May. In areas slightly away from prime central London, south of the River Thames,
further East or further West, we're still projecting upwards of 10 per cent growth per year for the next three or four years.
What are your thoughts on talk of a potential oversupply in residential property in Dubai?
I think it's clear that there's a lot more thought being given to the future needs of the city and the infrastructure and the requirements around that. We don't see an oversupply of property at the moment.
What's the potential of the UK as a market for Dubai property?
I think we will see steady growth, but we don't see it as a huge market. In fact, we see much more of the market opportunity coming from Asia. One of the things we're looking at the moment is the ability to attract market investment mainly out of India, Pakistan and other parts of that region, because there's a very strong appetite for them to invest in the Dubai market. And that's part of the things we're looking at while I'm here, to try to know the size of that market and how can we benefit from it.
If you were to buy property for investment in Dubai, where would it be?
As an investment, I like the Downtown Dubai area. There's still a lot happening around that area. Some of the same dynamics that play out across every city in the world are now coming on board in terms of the locations and the infrastructure, which help drive the investment potential.
If you were to buy property as a home in Dubai, where would it be?
Dubai Marina. I just think it's an ever-evolving area. There's lots of infrastructure, with restaurants, shops etc.
What are your thoughts on the Abu Dhabi market?
I think it's early days in the Abu Dhabi market. I think from a global perspective, people still look at Dubai as the main port of call when coming to the UAE. But we think long term Abu Dhabi is an exciting place to be.
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Source: Lobannie Tabada, Subeditor