Adrian Stott wrote: > "Neil Arlidge" > <[EMAIL PROTECTED]> wrote: > >> What was "suitable" property to get involved with in 2002 (or for >> that matter as late as Feb2006!!!) has proved to not be the case. > > This seems to be a persistent litany these days, especially among > people who oddly want to keep BW under the government's impecunious > thumb, but I doubt it stands up. > > Most of BW's property that is held for income is let on long-term > (typically 25 year) commercial leases. Such leases do normally have > periodic rent reviews, but these are usually specified as being > "upward-only" so the rent can never fall. This means that BW's > property income has probably reduced very little in the last year or > two, and isn't likely to. > > BW also holds property for development. Major developments (such as > Dockland's Wood Wharf) take years to get approved and built. If > prices for disposing of the result fall into a downturn, it is > relatively easy to slow the progress of the development so that it > will be on the market at the time prices are picking up, as they do > because the property market is cyclical . This is a normal part of > the property development business, rather than a surprise for the > unwary. > > Overall, property is a long-term investment, and it can't be judged by > comparison with short-term property market fluctuations. > > IMHO, the current condition of the property market is not a valid > argument against BW having, and depending on, a major property > portfolio. In fact, BW should surely be adding to its portfolio now. > > Adrian > > > > > Adrian Stott > 07956-299966
Adrian, Thank for your usual reply...it may as well come straight from the BW Press Office, or in the light of recent "leaks", the DEFRA Waterways Unit Office :-) You yourself have stated on public newsgroups that you are not happy with some of the present Management in BW. Who said anything about keeping BW under the Govts thumb?...should "BW" be under the thumb of a property / development company? (and a not very good one at that, run rather like Railtrack) I mentioned "property" in and around Brinscombe that has yet to be developed, or be used as land acquisition for the Stroudwater. So BW pulled out of "Cotswolds" because it is "not the right time in the development cycle"? Should BW be adding to it's property portfolio at the "top" of a land / property / yields cycle? (I certainly won't be!) 25 year commercial leases? I can't think of a single lease I've known in *office* premises for soooo long, not with out a break clause every couple of years. My own commercial lease was for 21 years with a break clause every 3 years. BW themselves have just signed a 5 year lease at Clarendon Road. Yes, a boatyard might get a 25 year lease, but not commercial premises But his main problem in this analysis is in not taking account of BW's *forecasts*. It's fine saying that existing commercial deals can't have rent reductions (which if things turn bad, a company patently can, by walking away at a break clause), but the BW financial self dependency is built (!!!) on bringing developments to market. ISIS hasn't had much success against its forecasts. Some interesting stuff in: http://www.bbc.co.uk/blogs/thereporters/evandavis/ which I am sure you will disagree with. Yes, you touch on slowing developments down to hit the upturn in markets that's hoped for (but not guaranteed), but the issue is this - BW has to earn the money NOW to keep waterways going, not slow down some property development until the time is right. Unless of course they are a property company :-) If it walks like a duck and quacks like a duck, it must be a duck! (plenty of quacking now going on!) -- Neil Arlidge - NB Earnest - Shannon Reg 7410 Read about the TNC Irish travels at: http://www.tuesdaynightclub.co.uk/Tour_07/index.html
