That's right on Friday 24th July we witnessed three evictions. With referendum votes counted Great Britain vacated the EU; Prime Minister David Cameron left Number 10 and Natalie bid farewell to the Big Brother house.
It’s with no surprise that commercial property, amongst many things, will be affected by the referendum.
It's important to look at why investors choose UK real estate in the first place:
1. Generally, commercial property retains its value if it doesn't increase;
2. The UK economy is considered to be relatively stable, with a rich culture and diversity of people, which makes the UK a good place to do business and therefore invest;
3. There is a steady rent from commercial property tenants who have secure, growing businesses.
And it’s not just commercial use properties that catch the attention of investors. Many will have large commercial portfolios made up of residential lettings.
The future is uncertain. It was uncertain prior to the referendum and continues to be so.
The analysts will speculate, but let's face it nobody has that crystal ball! Who knows what will happen in two years time when negotiations are complete and the exit strategy is defined; it's hard enough to predict what's happening tomorrow let alone what will happen in the medium or long term future.
It's this unpredictability which may have a negative impact on large scale investment in commercial property in London. It could be said that where property, both residential and commercial, prices fall as the pound weakens, the time for even more foreign investment may be ripe, almost like a real estate bargain hunt in the capital!
My hope is that SME’s have considered the potential outcome of each scenario and where needed, have contingency plans in place. For those that were relying solely on a 'remain’ result, it’s vital that preparations begin for stability and business growth.
I have heard various business commentators in the build up to the vote talk about the benefits of this new environment for SME’s. Will they thrive in the absence of the so-called ‘red tape’ of EU legislation? Or, will the impact of retracted EU grants, loans and finance only suppress our SMEs? Will this financial tide go out and never come back in?
One would hope that funding will be pumped back in to provide the SME infrastructure with the financial support it needs to thrive. But whilst the leave party has stated that there will be 'big savings' as a result of Brexit, nobody has actually said how and where these 'big savings’ will be allocated.
Many argue that it’s “business as usual’. Time will tell. The true consequences of this historic moment won't be realised for many years - whether they be good or bad!