Renting is back in Fashion

Residential Land, Prime Central Londons largest private landlord, was featured in this weeks edition of The Evening Standard ‘Homes and Property’ publication. Journalist David Spittles asks if renting property in London is becoming a lifestyle choice as much as a financial decision.

Residential Land, described as being ‘ahead of the game’, had a number of their Prime Central London properties featured, including Kew Bridge Court in Chiswick, River Lodge by Chelsea Embankment and Portobello Lofts, Notting Hill.

It is not particularly surprising that property entrepreneur Bruce Ritchie enjoys taking his meals at Mirabelle in Mayfair, London W1.
  After all, he is the joint owner. And the art deco eatery, as famous for being a place to see and be seen as for its carefully crafted French cuisine, is not the only clam in Ritchie’s business chowder. His company, Residential Land, and its sister vehicles own more than 1,000 flats and houses across London as well as string of city’s top eateries – the Criterion, Quo Vadis and Drones.
  He fell into ownership of Mirabelle though his friendship with its founder, top chief Marco Pierre White.
  But while owning restaurants is a canny investment play for Ritchie stocking them is more of passion.
  ‘I’m in shooting syndicate with a couple of other property guys,’ Ritchie explains. ‘We make sure we have refrigerated van hand so that when we’ve shot the birds we can then have them packaged up and distribute then among the restaurants in the chain.’
  Among the more recent high-profile guests have attended his syndicate’s shoots are Madonna and Guy Ritchie, to whom Ritchie could be related. ‘We may be, but aren’t sure how,’ he says.
  Bruce connection with Guy, director of Lock, Stock and Two Smoking Barrells, reflects the autumn menu’s emphasis on game. Ritchie admits that the chefs sometimes complain that they receive too many partridges from his exertions.
  Clearly, Guy and Madge dine at Mirabelle to eat what they kill, but it’s the sheer opulence that has attracted other celebrities over the years, such as Marlene Dietrich, Noel Coward Princess Margaret, Aristotle Onassis and Jonny Depp.
  Despite being located in basement opposite DTZ’s Curzon Street office, the outside world seems very far away when you swish though the revolving doors and step down the marble stairs. The overall effect of the art deco bar and restaurant area is of light and space, helped by stylish décor and cleverly positioned trample l’oeil cartoon murals, which give the place an almost colonial feel.
  ‘People always ask me that’s good when I take them here,’ says Ritchie. ‘And the truth is everything. We’ve got some smashing chefs and I’ve never had a bad experience here.’

The verdict: Mirabelle
In true Marco Pierre White style, the food is classic French with eclectic overtones. The lunch menu changes daily, while the main a la carte menu is long and revised infrequently.
  We opted for dressed crab, sauce mayonnaise and melba toast, which was deliciously light and melted in the mouth, followed by roast rump of lamb with olives and nicoise garnish. Other possibilities included langoustine bisque, roast pheasant or plaice fillets with aubergine puree.
  For pudding, we chose champagne-poached strawberries with crème vanilla. Other options include tarte sable of bitter chocolate and a large cheese platter.
  The lunch menu is set at a sensible £16.50 for two courses and £19.95 for three. The a la carte is substantially pricier.

For flats to rent in London visit http://www.residentialland.com

Residential Land, the property vehicle of Bruce Ritchie, has continued its central London spending spree with the acquisition of a block of flats in Pimlico.  It has acquired River Lodge at 128 Grosvenor Road and there is the prospect of more assets to come.

The off-market transaction was conducted ‘principal to principal’ with Bourne, said Ritchie. ‘We were offered the opportunity to trawl through it,’ he said.
The purchase price reflects a 6.1% yield.
Grosvenor Road is the latest in a string of purchases that has made Residential Land one of the most active investors this year.
It is restructuring its overall portfolio to focus on central London where its holdings total more than 250,000 sq ft (23,226 sq m). In 2005, the company sold more than £100m of non-core assets.

River Lodge follows the acquisition of 14 freehold houses nearby in Balvaird Place and Lindsay Square, south-west London, from a Malaysia-based investor (residential + regeneration, 21.07.06).
Earlier this year, Ritchie was believed to have purchased 7-8 Bathurst Street, west London, strengthening the company’s holdings around Hyde Park. Until recently the company has kept a low profile and Ritchie declined to comment on the growing speculation that Residential Land is poised to secure a £100m purchase. But the company has made no secret that it has the firepower to buy portfolios of up to £300m.
It has also made a virtue of its ability to move quickly when buying and selling residential investments.

Ritchie added: ‘Over 20 years, we have developed longstanding relationships with more than 1,200 prime central London estate agents and surveyors who have come to know us as the fastest movers in the central London property market.
‘If it is worth buying, why wait till tomorrow?’

Read more: http://www.propertyweek.com/story.asp?storycode=3073136#ixzz0XIfW7JQZ

For flats to rent in London visit http://www.residentialland.com

Residential Land, the investment vehicle of entrepreneur Bruce Ritchie, has made its first foray into serviced flats sector with the purchase of Grand Plaza in Bayswater, central London.

Grand Plaza. London flats for rent

Ritchie bought the 205-flat block from a joint venture between Singapore-based serviced residence operator Ascott Group and Bahraini developer Crown Dilmun.
The price is undisclosed, although Ritchie said it is Residential’s largest single-asset purchase.
The property at 42 Princes Square has been valued with vacant possession. However, Ritchie said Residential Land would run it as a fully serviced, short-stay business for the time being, with the aim of generating annual gross.
  ‘We’ve got our work cut out, but we’re confident we can do it.’ Ritchie’s optimism is based on the high number of enquiries for Residential Land’s large number of conventional flats in Bayswater and the strength of the private rental market in central London.
’We’re turning people away on a daily basis,’ he said. ‘There is a lot of marriage value between what we’re turning away and what we can put in that building.’
Ritchie indicated that in the long term, the 115,000 sq ft ‘trophy asset’ could be converted from short-stay serviced units to conventional flats.
’We’re certainly looking at it and whether it would be worthwhile for Westminster [City Council] to give that consent,’ he said.
Residential Land agreed the Grand Plaza purchase in July and completed it last week. Grand Plaza follows Residential Land’s purchase of Roland House in Kensington from Ascott and Crown Dilmun nearly two years ago.

For flats to rent in London visit http://www.residentialland.com

Residential land feature in Property Week

Bruce Ritchie

Residential Land’s managing director tells Doug Morrison about his assault on the capital’s investment market.

Few among property’s high flyers need any incentive to head for the south of France in March. But for Bruce Ritchie there was more to MIPIM this week than his customary ‘meet and greet’ on his luxury yacht in Cannes harbour.

It was a good opportunity for the founder and managing director of Residential Land to convene a meeting with Bank of Scotland to discuss progress on their new joint venture. The Blue Princess might seem a touch ostentatious for what was only the second board meeting after Residential Land and the bank launched their joint venture. But as Ritchie points out, it was here exactly a year ago that he and John Moran, the bank’s head of joint ventures, started discussing the deal.

It took until December to complete the paperwork as equal equity partners but now the joint venture is up and running in the form of two funds: Pure Skill and Acquire London.

Both will focus on prime central London residential property although Pure Skill is the main investment vehicle, while Acquire London is a trading fund.

The ultimate aim is to sell on to an institution or REIT over the next five years, in effect presenting mainstream investors with a slice of upmarket London residential in the sort of large ‘lot size’ they prefer. That was always Ritchie’s intention for Residential Land as it started to make its mark in London over the last decade.

Now, with the bank’s Uberior Joint Ventures subsidiary by his side, things are motoring. Full-page advertisements in the run-up to MIPIM boldly declared how Ritchie and the Residential Land team were to be in Cannes ‘with over £1bn to spend on prime central London property’.

In the circumstances, perhaps the 115 ft Baglietto is not that ostentatious after all. As Ritchie says with a smile: ‘MIPIM has been good to us.’

A few weeks earlier, we are sitting at a table in another popular property haunt, the Mirabelle restaurant in Curzon Street, Mayfair. It is a luxury home from home for Ritchie and a clear sign that London’s booming residential market has already been good to him. Alongside chef Marco Pierre White and restaurateur Jimmy Lahoud, Ritchie is an investor in White Star Line, the company that owns Mirabelle and other restaurants, such as Le Caprice, Criterion and Drones. As with his property holdings, Ritchie likes his food to be upmarket and in central London.

This is not bad for someone who began his property career in the early 1980s as a sideline while working as a trainee manager at Harrods department store. By the end of the 1980s property had become the day job and today, at 42, Ritchie is a market veteran. Residential Land, meanwhile, has emerged as one of central London’s biggest residential landlords.

To put it in context, the company’s portfolio now held in the joint venture funds equates to more than 1,000 prime London flats. Much of the buying impetus has come in recent years and will need to accelerate still further if the new funds are to hit their target in the stated time scale. In crude terms and at current prices, £1bn will represent about 2,000 flats, says Ritchie, pointing out that in the last six weeks, the company has bought more than 100,000 sq ft (9,290 sq m) of property. ‘At that rate, we’ll get there, I reckon,’ he says.
He acknowledges that it has taken effort to get Residential Land’s name on the radar of London’s selling agents over the years. And it will remain his brand out in the marketplace, buying up property and allocating it to the Pure Skills or Acquire London funds as appropriate.

One more thing will remain constant: Ritchie’s self-imposed restriction to 24 central London postcodes . Over the years he has operated from his St John’s Wood base, he has never been tempted to buy south of the Thames. Nor has he joined the bandwagon of residential speculators who have ventured into Docklands, fuelling huge house and land price inflation in the process. His postcode criteria amount, simply, to knowing the territory and a firm belief that he has barely scratched the surface in investment terms.

Ritchie points out that there are more than 3,000 estate agents operating in Residential Land’s chosen patch, and he and his team deal with 1,700 of them. In practice, the company is doing most of its work in the eight most central or poshest post codes and, even then, there is little sign of supply drying up.  ‘Already you’re beginning to see examples of quality buildings in central London containing flats selling at a three-and-a-bit yield, there is no lack of property to look at,’ he says. ‘There is no lack of property to offer on.

There may be a lack of property that you can acquire at an advantageous price. But we look at property all day, every day and never look at the same building twice. The point is, which one is the one that’s a deal and fits our portfolio?’

The question is all the more germane in 2007 after a prolonged boom in central London house prices and a startling 26.6% rise last year. Ritchie admits to some concern that ‘the top end is getting more expensive and the lower end is being pulled upwards’.

He has no truck, however, with the sceptics who fear the top of the market is nigh, pumped up beyond reason by inflated City bonuses pouring into residential real estate. Ritchie is more in tune with agents such as Knight Frank and Savills, which predict that capital growth will ease to a sober 9% or 10% this year, and declares himself comfortable with that.

Signed, yield, delivered
In rental terms, the heat is seen in yields that are nearer 3% than 4%. Ritchie says the market has risen faster than he anticipated when he wrote a report for Bank of Scotland following his fateful meeting with Moran at MIPIM last year.

‘Already you’re beginning to see examples of quality buildings in central London containing flats, rented out, selling off the back of three-and-a-bit yield. But I think 3% is a big psychological barrier,’ he says. ‘If you assume that it is in good condition and it has been rented correctly I can comfortably see any prime building ending up at that level of 3% gross yield. Seeing it less than that? Difficult.’

Ritchie’s judgement comes with experience and an attention to detail on acquisitions that seems no less attentive today with the support of Residential Land’s seven-strong buying team than it was 20 years ago. He understands the value of information. Indeed there was a spell during the early-1990s recession when he successfully published and sold lists of repossessions, which gave him the opportunity to buy the best ones for his portfolio.
He mentions a recent acquisition, Roland House in Kensington, which had 17 staff and a gross rental income when Residential Land bought it. Now he has two people managing the 100-unit flat block.
It is this assiduous management as well as Ritchie’s market knowledge that has drawn Bank of Scotland from the very top chief executive Peter Cummings was involved in putting together the joint venture.
But why go with one bank when Residential Land has worked with all the big lenders over the years? What is more, as recently as last summer Ritchie says he was considering an acquisition that would have transformed the company in its own right before plumping for the joint venture.

‘A sizeable proportion of my time was spent nurturing banking contacts and making sure each of them understood our business so that we were able to borrow what we needed when we needed it. But I want to put more of my time into acquiring assets,’ he explains.

‘Beyond the advantage of parking our stock there at a price so I don’t need to worry about it any more, if you think about it I started from nothing, so I’m used to joint venture partners and giving away an equal or slightly less-than-equal share of the profits.’

As for the future, the exit route is likely to be a straight sale to a REIT or institution rather than a public listing. Although Ritchie’s experience as a restaurateur makes him comfortable hosting industry receptions in Cannes, he grimaces at the suggestion of a flotation for Pure Skill. He likes his privacy and he prefers the property market to the stock market.

‘Buying and selling is what’s exciting,’ Ritchie says. ‘Five years is a long time in property and we have to be conscious about what the market dictates. At the time, we may have finished building what we’re looking to build. If it’s going well and we’re happy to carry on buying, we may decide to do a lot more together.’ Laughing, he adds: ‘I’m not so old that I have to sell up and go.’

For flats to rent in London visit http://www.residentialland.com

Residential Land featured in The Estates Gazette

For many people, buying and selling a flat is a hassle or, at best, a job. For Bruce Ritchie, it’s a way of life.
  ‘We’re getting to a stage now where we’re mostly bidding against the institutions,’ says Ritchie. ‘But that can be a big problem because many institutions vendors don’t know us and tend to go with people that they’ve heard of. Still, with a bit of work, we think we can expand even further and take them on.’
  Richie, who began his property career in the 1980s as a sideline while working as a sales manager and assistant buyer at Harrods department store, has built up, over past 20 years, a massive property portfolio and trading company worth a lot. Ritchie owns more than 1,000 prime London flats and has a joint share in such top London restaurants as Criterion, Mirabelle, Quo Vadis and Drones.
  ‘It was a running joke when I was at Harrods,’ says Ritchie. ‘Where’s the sales manager?’ ‘Oh, he’s on the phone to his solicitor doing another deal’. It was a pretty good job, really – not too stressful, so I could get on with buying and selling flats at the same time.’
  Richie’s property career was born when the south London boy realised one day that he could make more money flipping one flat than he could by working at Harrods for an entire year.

Bruce Ritchie

  He made his first purchase, 5 Albert Close in Hackney, N9, in 1985 at the tender age of 21. When he discovered that the property he had bought for £64,000 had increased in value to £96,000 in year, making him a profit that easily exceeded his annual salary, he was hooked. He quickly put an offer of £72,000 on the house next door, which he sold for £86,000 two weeks later.
  ‘I still go back to Harrods and see the people I was working with 20 years ago,’ he says. ‘Only now I’m a customer. You can see them thinking, ‘how has he managed to do so well for himself?’ It’s a good feeling.’
  Ritchie joined Harrods in 1983, aged 18, as an executive trainee. He had already built up a small business at his south London public school, Dulwich College, buying and selling cars in his spare time.
  ‘I was particularly keen on Lotuses in those days,’ says Ritchie. ‘I worked out that by buying cars at a used car dealership near Manchester Piccadilly station and re-selling them in London, I could make a fairly tidy profit.
  ‘It was the 1970s and I had a bright orange Lotus with a green interior,’’ he adds. ‘I used to backfire all the time. People certainly noticed you sitting in a queue of traffic.’
  By the time the quit Harrods in 1986, Ritchie had built up an extensive property operation by trading residential units across London. However, as many similar small property companies went to the wall during the late 1980s property crash, Ritchie was forced to think rather more creatively.

A newspaper advert opens doors
‘It was at the height of the recession. I was leafing though The Sunday Times and saw an advert from this bloke who was selling a list of repossessed flats from one particular lender,’ he says. ‘I called him up and he agreed send me the list for fifty quid.’
  ‘And then I thought, there’s money to be made from going corporate-style and selling an authoritative list of repossessions from all the main lenders rather than just one, as this guy had done.’

Ritchie’s next venture was the London Repossessions List. He bought a huge photocopier and persuaded the main lenders to contribute to a regular list which he published though a separate company, charging £65 for a three-month subscription. Repossessions were listed both alphabetically and by region. The list proved so popular that Ritchie even exhibited it at Earls Court.
  ‘I got to the point where we went to the Ideal Home Exhibition to sell the list in 1994,’says Ritchie. ‘I was still the middle of recession and no-one was selling any homes, so we got a ridiculous deal on stand 2086, the stand behind the Nationwide, and we had queues of people coming to look at the lists, which we put up for free.’
  Ritchie also managed to swing a cheap advertising deal at exhibition, and lists of 2,000 repossessed homes graced all the main turnstiles in the Earls Court centre. Subscriorions to thelist were also adertised though an irritating jungle on Capital Radio. To the bafflement of Ritchie, the ad generated the most telephone responses at 4am each morning.
  Meanwhile, dealing with repossessions allowed Ritchie, working from the company’s Abbey Ritchie, working from the company’s Abbey Road offeces in St Jon’s Wood, to cream off the best ones for his growing personal portfolio and trading company.
  He has a lot of residential properties, located mostly in the areas surrounding Hyde Park and Regent’s Park. And Ritchie, along with chef Marco Pierre White and restaurateur Jimmy Cahoud, is an investor in White Star Line, the company that owns upmarket restaurants Caprice, Criterion and Drones.
  The company owns Garden House a block of 58 rented flats in Kensington,W2, and has recently bought Roland House, a block of 94 flats in Kensington that was being marketed by Savills. His company is understood to have bid for the  £300 British Land residential portfolio now under offer to Insight.
  Now, with a large rental portfolio that is managed mostly by on-site managers and a staff of 18, the company is looking beyond small-time residential deals to invest in larger properties, both for reasons of economy of scale and because it faces fewer rival bidders.

Residential Land has a large selection of properties to rent in London. As one of the Capital’s largest private landlords, we are residential property experts specialising in the acquisition, sale, rental and management of our portfolio of over 1,200 flats in London.  Based in the heart of Mayfair, the Residential Land team invest at an institutional level acquiring increasing numbers of properties in our specific areas of operation.

Residential Land featured in The Evening Standard

 

With London’s rental market maturing, developers are finally caching on and building new homes to let rather than sell, says David Spittles.

Developers have missed a trick in recent years by failing to cash in on London’s maturing rental market. More than half the numbers of new flats sold are bought by investors and up being rented out. Finally, Building for rent is breaking into the mainstream. London’s estate landlords – such as Grosvenor and Cadogan – were the first to change tack.

New and refurbished flats are now let on assured shortholds rather than on enfranchiseable leases. These way freeholders can keep possession while enjoying a regular income steam and a rising asset. The logic of this strategy is now dawning on developers. There is growing demand for mid-market rentals – good quality apartments conveniently located in inner London and suburban town centres, boasting good commuter transport links. Another incentive for developers is that the footloose nature of tenant means homes could be builds on sites that may not be suitable locations for owner-occupiers.

Roland House - London flats for rent in South Kensington

The Royal Borough of Kensington and Chelsea hardly fall into that category. In this part of London serviced apartments aimed at jet-set executives and rich tourist do brisk business. Now, one of the area’s biggest serviced apartment blocks - formerly The Somerset – has been refurbished and turned in to scheme of 100 flats for rent on a conventional basis. It was an obvious gap in the market, according to developer Residential Land, which is offering tenancies of up to 24 months and paying the deposit (worth up to £3,000) as an incentive. Called Roland House, the development has 24-hour porterage and a gym. Flats are not lavishly fitted out and furnished, but they are comfortable enough for stop-gap tenants.
  Shilpa Rao, a teacher at Dulwich College, has moved into a studio apartment there. ‘’I wanted to move somewhere safe. Previously I rented in north London and had some terrible experiences with security.’’
  Rents at Roland House start at £350 a week for studio, £450 a week for one-bedroom flat and £ 650 a week for a two-bedroom flat. For details call 02073416800.