Seizing New Opportunities: Property Development and Investment in Light of GPDO Amendments

February 28, 2024  property development, property investment, PropTech

In the ever-evolving landscape of property development and investment, staying abreast of regulatory changes is paramount. Recently announced amendments to the General Permitted Development Order (GPDO) by Michael Gove present a wealth of new opportunities for developers and investors alike. These amendments, set to take effect from March 5, 2024, promise to streamline processes, remove barriers, and stimulate growth in the real estate sector.

Property Development Loans With A First Charge

One of the most significant changes introduced by these amendments is the expansion of Class MA Permitted Development (PD) rights. Previously, developers faced constraints such as a 1,500 sqm maximum floorspace limit and a three-month vacancy requirement when converting commercial properties (Class E) to residential use (Class C3). However, with these limitations lifted, a broader range of properties becomes eligible for conversion, paving the way for innovative redevelopment projects without the bureaucratic hurdles of traditional planning applications.

The government’s initiative is twofold, aiming to address both the pressing need for housing and the revitalization of struggling high streets across the nation. By unlocking the potential of underutilized commercial spaces, developers can play a pivotal role in tackling these dual challenges while breathing new life into communities.

While the amendments offer a promising outlook for the industry, it’s essential to navigate potential exemptions and nuances. Certain areas, such as parts of Central London, Greater Manchester, and East Hampshire, may remain subject to specific regulations despite the broader changes. Understanding these intricacies is crucial for maximizing opportunities and minimizing obstacles.

Moreover, industry support for these reforms underscores their significance in addressing pressing issues like housing shortages and environmental sustainability. With the potential for significant development value, particularly in regions like Yorkshire, developers and investors stand poised to make substantial contributions to the housing market while driving economic growth.

However, seizing these opportunities requires careful planning, financial acumen, and compliance with relevant regulations. Tax breaks and incentives, such as reduced VAT rates for property conversions, offer additional incentives for stakeholders embarking on redevelopment projects. Seeking expert advice on financial, planning, and building control matters is paramount to navigating this evolving landscape successfully.

As the property development sector embraces these amendments, collaboration and strategic partnerships will be key to realizing their full potential. By leveraging innovative approaches and leveraging available resources, developers and investors can transform visions into reality while contributing to the sustainable growth of communities nationwide.

In conclusion, the amendments to the GPDO herald a new era of possibilities for developers and investors in the property market. By embracing these changes and leveraging industry support, stakeholders can unlock untapped potential, address pressing societal challenges, and shape the future of real estate development in the United Kingdom.

Finding Secure Investments in the Current Climate: How Property Development and Renewable Energy Can Help

March 23, 2023  asset, buy to let, diversify portfolio, How to profit from inflation, investment, joint venture, property development, property investment, property joint venture, tech investment, uk property development, what to invest in now, what to invest in right now

In the current economic climate, investors are looking for secure investment opportunities that can provide stable returns while mitigating risks. Property development and renewable energy are two sectors that offer potential for long-term growth, and combining them can provide an even greater opportunity for secure investments. In this blog, we will explore how property development and renewable energy can help investors find secure investments in the current climate.

Willow Rivers Wealth Bolg
Willow Rivers Blog gives our readers market trends and investment ideas for proptech, greentech and fintech.
  1. Property Development

Property development can provide investors with a secure investment by offering stable returns over the long term. As the population grows, the demand for housing increases, creating opportunities for property developers. By investing in property development projects, investors can benefit from steady rental income, capital appreciation, and tax advantages.

To mitigate risk, investors can focus on well-located properties with high rental demand, ensuring a steady flow of income. Additionally, investing in property development projects with a strong Gross Development Value (GDV) can help ensure profitability and reduce risks associated with underperforming projects.

Willow Rivers Wealth offers a range of property development investment opportunities in prime locations across the UK. Our projects have strong GDVs and are designed to deliver consistent rental income and capital appreciation. Learn more about our property development opportunities here.

  1. Renewable Energy

Renewable energy is another sector that offers potential for long-term growth and secure investments. As the world transitions towards more sustainable sources of energy, the demand for renewable energy is increasing, creating opportunities for investors.

Investing in renewable energy projects can provide stable, long-term returns through the sale of electricity or energy credits. Additionally, renewable energy projects can benefit from tax credits and government incentives, reducing risks and increasing returns.

Willow Rivers Wealth also offers investment opportunities in renewable energy projects. Our portfolio includes solar, wind, and hydro energy projects, providing investors with a diverse range of renewable energy investment options. Learn more about our renewable energy opportunities here.

  1. Combining Property Development and Renewable Energy

Combining property development and renewable energy can provide even greater opportunities for secure investments. Property developers can integrate renewable energy systems into their projects, reducing energy costs, and increasing the value of the properties.

Investors can benefit from the stable returns of property development projects, while also investing in renewable energy, creating a more diverse and secure investment portfolio. Additionally, property development projects with renewable energy systems can benefit from government incentives and tax credits, reducing risks and increasing returns.

Willow Rivers Wealth’s property development projects often incorporate renewable energy systems, providing investors with a unique opportunity to invest in both sectors. Learn more about our combined property development and renewable energy investment opportunities here.

Conclusion

Investing in property development and renewable energy can provide secure investments in the current economic climate. By investing in well-located properties with high rental demand and strong GDV, investors can benefit from steady rental income and capital appreciation. Additionally, investing in renewable energy projects can provide long-term, stable returns, reducing risks and increasing returns. Combining these two sectors can create even greater opportunities for secure investments while contributing to a more sustainable future.

At Willow Rivers Wealth, we specialise in property development and renewable energy investments. Contact us to learn more about our investment opportunities and how we can help you find secure investments in the current climate.

What is GDV in property

 joint venture, property development, property investment, property joint venture

The Gross Development Value (GDV) is a crucial consideration for any property developer looking to build a residential property portfolio. It represents the total value of a development project and plays an essential role in assessing the profitability and feasibility of a project. In this blog, we’ll explore the importance of GDV in developing residential property portfolios, with a focus on the advantages of having a local government council buy the final units. We’ll use the south-east of England as an example to illustrate the points.

GDV and Residential Property Portfolios

The Importance of Gross Development Value (GDV) in Developing Residential Property Portfolios" - Learn about the crucial role that GDV plays in assessing the profitability and feasibility of property development projects, pricing units effectively, and optimizing returns for developers.
The Importance of Gross Development Value (GDV) in Developing Residential Property Portfolios

The GDV is an essential metric for property developers, and it plays a critical role in developing a residential property portfolio. This is because it provides an estimate of the total value of the project, which helps developers determine the viability of the project and the potential return on investment. By understanding the GDV of a development project, property developers can evaluate the costs and risks associated with the project and make informed decisions on whether to proceed with the development or not.

Furthermore, the GDV also helps property developers determine the selling price of the units within the development. This information is crucial for developing a residential property portfolio as it enables developers to price the units effectively and remain competitive in the market. Understanding the GDV can help developers to optimize their returns by pricing units appropriately, avoiding overpriced units and ensuring that all units are sold or rented out within a reasonable timeframe.

Advantages of Having a Local Government Council Buy the Final Units

In the south-east of England, local government councils are increasingly looking to purchase units in new residential developments. This trend has several advantages for property developers looking to build a residential property portfolio.

Firstly, having a local government council buy the final units can provide developers with greater financial security. Local councils are often stable, long-term purchasers who can provide developers with a guaranteed sale for the remaining units in the development. This can help developers to manage their cash flow and ensure that the development project is completed on time and within budget.

Secondly, selling units to local government councils can help developers to meet their affordable housing quotas. Many local councils require developers to provide a certain percentage of affordable housing units in new developments, and by selling to the council, developers can meet these requirements without compromising their profit margins.

Thirdly, selling units to local government councils can provide developers with an additional source of demand. This can help developers to sell units quickly and efficiently, reducing the time and costs associated with marketing and selling units on the open market.

Conclusion

In conclusion, the GDV is a crucial metric for property developers looking to build a residential property portfolio. It provides developers with an estimate of the total value of a development project, helping them to determine the viability and profitability of the project. Furthermore, in the south-east of England, selling final units to local government councils can provide developers with several advantages, including financial security, meeting affordable housing quotas, and additional sources of demand. By understanding the importance of GDV and the advantages of selling to local government councils, property developers can optimize their returns and build successful residential property portfolios.

 

Investing in property development projects can be a lucrative venture for investors, and understanding the Gross Development Value (GDV) is an essential part of evaluating the potential return on investment. Here are some of the advantages for investors in property development projects:

  1. Potential for High Returns: Property development projects have the potential to provide high returns on investment, especially when the project is successful and achieves a high GDV. The GDV provides an estimate of the total value of the project, which can help investors evaluate the potential return on their investment.
  2. Mitigating Risk: By understanding the GDV, investors can assess the level of risk associated with a property development project. This can help investors to make informed decisions about whether to invest in a project or not. Additionally, investors can assess the level of risk by considering other factors such as location, demand, and the reputation of the developer.
  3. Diversification: Investing in property development projects can provide investors with diversification, which is essential for managing risk in a portfolio. By investing in different projects, investors can spread their risk across different markets and reduce the impact of any losses in a single investment.
  4. Access to New Markets: Investing in property development projects can provide investors with access to new markets that they may not have been able to access otherwise. This can provide investors with opportunities to diversify their portfolio and take advantage of emerging trends in the property market.
  5. Control: Unlike investing in traditional property assets such as buy-to-let properties, investing in property development projects can provide investors with greater control over the investment. Investors can work closely with developers to manage the project and ensure that it is completed within budget and on time.

In conclusion, investing in property development projects can provide investors with several advantages, including high potential returns, diversification, access to new markets, and greater control over the investment. By understanding the importance of GDV and other factors that impact the success of a property development project, investors can make informed decisions and build successful property portfolios.

Why JVing with an existing developer is better for UK property development

March 10, 2023  buy to let, inflation proof investments, Investments, joint venture, property development, property investment, property joint venture, uk property development, Uncategorized, what to invest in now, what to invest in this quarter

The UK property market is notoriously difficult to navigate, with high costs, complex regulations, and a shortage of affordable housing. For those looking to enter the market, there are two main options: to start a property development project from scratch or to joint venture (JV) with an existing developer. While both options have their advantages, there are several compelling reasons why JVing with an existing developer is the better choice for UK property development.

JV
JV

Entering the UK property market can be a challenging task for anyone. However, JVing with an existing developer can provide access to valuable expertise. An experienced developer will have a wealth of knowledge regarding the local market, contacts with suppliers and contractors, and a deep understanding of the complex regulatory landscape. Trying to build this expertise from scratch is time-consuming and costly, and mistakes can be costly. A JV partner can provide a valuable shortcut to success.

Another benefit of JVing with an existing developer is the sharing of risk. Property development is a high-risk business, with a significant amount of capital and time invested in each project. By JVing with an existing developer, you can share this risk, minimizing your exposure to financial losses. Sharing risk with a partner also provides an opportunity to leverage each other’s strengths, expertise, and resources to ensure project success.

JVing with an existing developer can also help to reduce costs. An experienced developer will have established relationships with contractors and suppliers, as well as access to financing at favorable rates. They may also have economies of scale that can reduce the costs of materials and labor, which can be particularly beneficial when working on larger projects.

Developing a property from scratch can be a complex process involving numerous stakeholders, including architects, contractors, lenders, and regulatory bodies. With a JV partner, many of these processes will have already been streamlined and optimized, reducing the time and effort required to get a project off the ground.

Lastly, JVing with an existing developer can also provide improved exit options. By partnering with an established developer, you may be able to sell your share of the property development project more quickly and easily, freeing up capital to invest in other projects or diversify your portfolio.

In conclusion, JVing with an existing developer is the better option for UK property development. It provides access to expertise, reduces costs, streamlines processes, shares risk, and offers improved exit options. By working with a JV partner, you can leverage their knowledge, experience, and resources to achieve success in the competitive UK property market.

Is the Cambridge laboratory space a good investment ?

February 6, 2023  biotech, Investments, property investment

The Cambridge laboratory space market is currently experiencing a high level of demand, making it an attractive option for property investors. This demand is driven by a number of factors, including the growing number of technology companies and start-ups in the area, as well as the presence of a number of prestigious universities and research institutions.
Cambridge lab space
Cambridge laboratory space.
One of the key advantages of investing in laboratory space in Cambridge is the quality of the tenant base. Many of the companies and institutions located in the area are leaders in their respective fields, and have a strong track record of success. This can help to ensure that rental income remains stable, even during times of economic uncertainty.
Another factor that makes Cambridge an attractive option for property investors is the relatively low vacancy rate. The demand for laboratory space in the area has been consistently high in recent years, which has helped to keep vacancy rates low. This can help to ensure that properties remain occupied, and that rental income remains steady.
Despite the strong demand for laboratory space in Cambridge, there are still a number of challenges that property investors need to be aware of. One of the main challenges is the high cost of land and construction. This can make it difficult for investors to find properties that offer good value for money.
Another challenge is the competition for properties in the area. Because the Cambridge laboratory space market is so popular, investors may need to be prepared to compete with other buyers in order to secure the properties they are interested in.
Despite these challenges, the Cambridge laboratory space market remains an attractive option for property investors. The high demand for space in the area, coupled with the quality of the tenant base and the relatively low vacancy rate, make it an ideal location for investors looking to invest in laboratory space.
Overall, the Cambridge laboratory space market is a great option for property investors who are looking for a stable and reliable investment opportunity. With the right approach, investors can find properties that offer good value for money, and which are likely to generate a steady stream of rental income.

How To Profit From Inflation.

May 21, 2021  FinTech, Green Technology, GreenTech, How to invest for inflation, How to profit from inflation, inflation proof investments, Investments, property development, property investment, PropTech, Solar

How To Profit From Inflation.

 

Unless you have been living under a rock for the last few weeks, you will have seen that the markets have been spooked by the prospects of higher inflation. This has come about due to the post Covid bounce we predicted back in January, in our Roaring 20s article. https://willowrivers.com/the-roaring-20s-are-back/ This latest article looks at how to profit from inflation.

Just in case you don’t know what inflation is. I have borrowed a definition from Robbert Kiyosakis website: The simple definition of inflation is when prices rise and the purchasing power of a currency drops. It means that you can buy less with your money than you used to be able to. Simple!

So we are all getting poorer. Our money goes less far and this is bad news unless our income is linked to inflation.

Luckily there are ways of beating this. Some assets perform better than others in an inflationary environment and we are lucky enough to have a number of these on our books here at Willow Rivers Wealth Ltd.

How to profit from inflation
How to profit from inflation

Long-term (since 1950) correlation between inflation & various financial/real assets.

So lets first look at what not to do!

The worse thing you can do, is hold all your net worth in cash in an inflationary environment. You are effectively making a negative return. With some analyst stating inflation could pass 5% this is a very real threat.

The boom on the back of the rapid vaccine rollout is starting to take shape and many assets and commodities are getting swept up in the rapid recovery. None more so than in the construction industry:

https://www.constructionnews.co.uk/supply-chain/construction-materials-shortage-5-key-items-in-short-supply-17-05-2021/

https://www.theconstructionindex.co.uk/news/view/developers-urged-to-start-now-to-beat-build-inflation

Inflation in building materials will lead to higher prices for construction and thus higher property prices down the line. Added to this, demand for property is rising as people come out of look down and look to improve their living standards.

Fuel prices are also rising rapidly as we get back on the roads and start to fly again. Expect $100 oil in the not too distant future. https://financialpost.com/commodities/energy/oil-gas/peak-demand-more-like-a-supply-crisis-propelling-oil-to-us100

So how do we beat and profit from inflation?

How to profit from inflation

  • Property Investment

So the first and most obvious place to look when trying to beat inflation in the property market. Inflation is also a good time to use leverage. One can buy a property with a buy-to-let mortgage and buy an appreciating asset with a 25% deposit but see capital appreciation on the full value of the property. If you fix in your mortgage rate for several years you should be able to see steady capital appreciation and rental growth, while your fixed interest costs remain the same. A very crude example of this would be a if a 100,000 pound flat appreciates by 10% and you have invested 25,000 you have made a paper profit of 40%. (10,000/25,000 x100) comfortably beating inflation. There are obviously other costs to take into account but even when these are added you should still be well clear of any inflation.

  • Property development.

By developing houses and projects now, you can build at the current prices and sell at the new rate of inflation in 6 to 12 months time. We offer a number of property developments around the county all with market beating returns of 15%+. We use a JCT contract https://corporate.jctltd.co.uk/products/about-our-contracts/ which fixes the price of the build at the front end and avoids any uncomfortable surprises for the investor. Get in touch to find out about our latest development opportunities around the county. More details at www.willowrivers.com

 

  • Commodities

You can trade commodities on all the usual platforms such as Etoro and IG. Oil, Copper and Timber are already showing excessive growth, but just about any commodity used in the building process will see substantial growth over the next couple of years.

 

  • Renewable energy with inflation linked returns.

We have been developing renewable energy projects for over ten years now. Feed-in-tariffs linked to inflation are a thing of the past now, however we are still building private projects with a Power Purchase Agreement (PPA). The power generated from wind, solar or geothermal is sold back to the business below and the contract is fixed for 20 to 30 years with an inflation linked kicker to the price. We are able to generate 10% to 15% pa returns which will rise in line with inflation. Get in touch to find out what projects we have available for investors. Projects start from 20,000 pounds to 25m. www.willowrivers.com

  • Farmland and Forestry

UK Farmland will also appreciate again. The combination of the security land ownership offers, zero inheritance tax and yields linked to commodity prices will attract both UK and international investors alike. We work closely with a number of UK land companies and can help with forestry and agricultural land investment.

Conclusion

Don’t just take our word for it, hedge fund manager Michael Burry made famous in the the movie Big Short is also investing for inflation. https://moguldom.com/338484/famous-big-short-investor-michael-burry-warns-weimar-like-hyperinflation-is-coming-to-america/

Now is the time to get your house in order and profit from what is likely to be a bumpy road ahead.

If you have any questions about building an inflation proof portfolio, do get in touch and we can discuss some strategies.

    Additional resources on inflation:

     

    Institute of International Monetary Research has produced a good video on their inflation expectations over the next couple of years.

     

    Good video here on why we can expect higher inflation of the next couple of years.

    https://www.theguardian.com/business/2021/may/15/the-fear-that-haunts-markets-is-inflation-coming-back

    https://www.marketwatch.com/story/the-biggest-inflation-scare-in-40-years-is-coming-what-stock-market-investors-need-to-know-11617846712

    https://www.wsj.com/articles/if-inflation-is-coming-here-is-what-to-do-about-it-11620694235

    Subscribe to receive updates!

    Click below to listen to the Willow Rivers Podcasts

    Address

    90, 2 Lansdowne Row, Mayfair, London W1J 6HL, United Kingdom

    Email

    info@willowrivers.com

    Phone

    020 323 96711