Our Senior Portfolio Manager, Francis Ribeiro talks you through his process in identifying key area’s to help you invest early and reap the benefits.
Royal Arsenal and Manchester Regent Plaza
Finding a development in advance of the wider investor audience can reap large rewards for investors, a location that is yet to reach its full potential but with all the foundations in place to send capital growth soaring whilst attracting professional tenants.
Ten years ago I chose to invest in the Royal Arsenal development. Located on the south bank of the River Thames in Woolwich, the area was relatively unknown as an investment prospect. Back then, as an early bird investor, you could have secured a one-bedroom apartment for circa £160,000-£180,000. Today you will be lucky to find anything under £450,000.
Royal Arsenal – a brief history
The Royal Arsenal was originally used by the British armed forces to armaments manufacturing, ammunition proofing and explosives research. At the time of the First World War, the site covered 1,285 acres and employed 80,000 people, after the war operations were scaled down and it finally closed as a factory in 1967 with the Ministry of Defence moving out in 1994.
Since the Ministry of Defence left the area has seen considerable regeneration as one of the largest sites to undergo such a program in the country.
Investment with similar credentials
This brings me to a similar area which is seeing major regeneration, located right on the edge of Manchester City centre, that offers solid fundamentals as an investment prospect, ultimately allowing astute investors to benefit from a similar experience to mine with the investment at The Royal Arsenal.
This led me to do a comparison and identify what to expect from this area:
The Royal Arsenal has seen success due to its proximity to major European employment centres; London Docklands which is one of the world’s leading global internet hubs, The City of London, home to the global corporate businesses and Canary Wharf< which is the secondary central business district of London. Regent Plaza is close to two major Northern Powerhouse employment centres; Manchester city centre which is home to many FTSE100 companies and Salford’sMediaCityUK whose primary tenants are the likes of the BBC and ITV amongst other large media companies.
Royal Arsenal was earmarked for large scale regeneration from the offset and has doubled in value in less than 10 years.
Regent’s Plaza is going through a similar regeneration program and has massive growth potential with the growing population, jobs creation, major employers moving into Manchester. Furthermore, student retainment is on the increase, the traditional mass migration South of those completing their studies is not taking place as mature students are attracted to the great quality of life offered at their doorstep.
The city has a global presence, with Manchester airport within 9 miles of the development, allowing international operations and travel to take place seamlessly.
Not to forget that Manchester City is the actual “epicentre of the Northern Powerhouse” and to add to the credentials, Manchester has not one but two premier league football teams.
Infrastructure and transport connections
One of the big attractions for investors at the Royal Arsenal is Crossrail, one of Europe’s largest infrastructure projects, allowing commuters to travel across central London within minutes; Woolwich has its own stop.
Manchester is expecting High-speed rail to arrive in the coming years. HS2 will dramatically reduce travel times between Manchester and London along with many other important hubs across the UK. Being a short distance from the city centre the Regent Plaza development will benefit from overall improvements to Manchester’s infrastructure.
In terms of localised transport, the Regent Plaza development is located on the Regent Road which is the linking arterial route between the Mancunian Way running around the southern half of Manchester City Centre and the M62, with transport links west to Warrington and Liverpool making it exceptionally well connected.
Manchester property prices
Manchester has one of the UK’s more established property markets, with an excellent track record in terms of price growth; prices in Manchester are reported to have grown by over 25% in the past 5 years.
Rental yields are also solid with Manchester having a great deal of appeal and a strong, growing economy.
Why Regent Plaza?
It’s easy to see why an opportunity such as Regent Plaza is appealing to any investor who missed the London boat 10 years ago or anyone who finds themselves priced out of the London market now. This opportunity is a golden ticket for investors to grab and build their wealth.
Regent Plaza is a luxury development, with state-of-the-art facilities for the residents including a gymnasium, lounge and communal gardens and a rental higher yield than the Royal Arsenal was offering 10 years ago.
The development has been exceptionally well priced at just below the current market price by almost 5% to 10% making it an attractive prospect. The developer has also given an additional discount to savvy investors as an extra equity buffer from the list price to act as a cushion during the current market climate.
It’s easy to see why we’re so enthusiastic about this development, actively encouraging our clients to consider such a great opportunity, an opportunity of lifetime similar to the one I was offered 10 years ago.