THE LONDON PROPERTY MARKET
‘It’s a feeding frenzy.
There’s so much money’
Judi Bevan meets a top estate agent who thinks only a
terrorist bomb can stop the capital’s house prices soaring
Peter Rollings is one of those glowingly fit and forceful people who emit an unrelenting positive energy into the air around them. ‘Yes, energy is my big thing,’ he says, enthusiastically. ‘I don’t see the point of being down. Energy is infectious but so is negativity.’ He’s instantly friendly, the sort of chap who can strike up a rapport with anyone from a secretary looking for her first flat to a Russian oligarch wanting a Regency stucco pile in Belgravia. Yet behind the smile, his brown eyes are as hard as marbles.
Rollings is an estate agent; in fact he’s probably the luckiest estate agent in Britain. In June 2005, after 20 years running Foxtons, an agency known for its controversial hard-sell practices, he fell out with its founder Jon Hunt. ‘I felt we were too hard on the people,’ he says. More crucially Hunt refused to give him an equity stake in the business. Rollings walked out, borrowed a sack of money and bought the Marsh & Parsons agency in a joint venture with the Irish group Sherry FitzGerald run by Mark FitzGerald, son of the Irish politician Garret FitzGerald. Rollings owns 24 per cent.
Six months later the London house market lifted off a four-year plateau and in 2006 it blasted towards the stars. Rollings reckons that prices rose overall by 30 per cent in two years – but for properties worth more than £5 million, the rise is as much as 70 per cent.
The über-rich, in particular ‘non-domi ciled’ residents who live here but pay taxes elsewhere, had arrived from Russia, China and India with a callous disregard for anything other than getting what they want. In Kensington, Chelsea and Holland Park £10 million houses are now almost commonplace. ‘A flat in The Knightsbridge went for £25 million in an off-market deal the other day — that’s £4,000 per square foot,’ Rollings says in hushed tones. And then there was the sale of a vast 20,000 sq. ft apartment for £82 million in Number 1 Knightsbridge, a development by the thirtysomething Candy brothers. ‘It’s a feeding frenzy. Something comes on the market with the right position, right lease, right rooms and you can almost name your price.’ Rollings found himself in exactly the right position at the right time. When he arrived at Marsh & Parsons it was an old-fashioned, gentlemanly firm with six offices plum in the middle of the Royal Borough of Kensington and Chelsea, encompassing Notting Hill and Holland Park — a crucible of London property hot-spots. He instilled what he regards as the best of the Foxtons’ culture while leaving out what he had come to loathe, and bought Vanstons, a smaller agency, for £3 million, to bring the number of offices to 12.
Hunt is now selling Foxtons to privateequity buyers for about £400 million — so surely he did something right? ‘Jon had a terrific work ethic and he taught me attention to detail and keeping costs under control,’ he says. ‘Foxtons became an amazing money-making machine. It was like a cult, but we got too big, too impersonal.’ The window of the Marsh & Parsons’ Kensington Church Street office has details of a one-bedroom flat for more than £500,000. Inside, the agents sit in two long rows, wearing headphones. It reminds me of a City trading floor. Rollings sees it as the best of both worlds. ‘What I hate is you walk into most estate agents and you’re left standing there like an embarrassed schoolboy — it all feels kind of scuzzy.’ So why have prices gone so mad? Is it the City bonuses, the Russians, the Chinese? ‘Yes all of those, and the Indians, the filmmakers and the lawyers — lawyers big time,’ he says. ‘London is a renaissance city. Twenty years ago it was inward-looking; now it is the cosmopolitan capital of Europe and possibly the world.’ Strangely for someone who heaps such praise on the capital, he grew up on a farm in West Sussex, the youngest of four children. He describes it as a ‘magnificent place to grow up’, but it soon bored him. At Cranleigh School in Surrey he excelled at sport, particularly cricket and after A-levels he won an English-Speaking Union scholarship to the Hill School in Pennsylvania. Afterwards he joined Lane Fox in North Audley Street, where he was the only person in the country-house department who hadn’t been to Eton. After three years there, a squash partner put him in touch with Jon Hunt.
The basic pay of estate agents remains low at around £18,000 a year, so picking good people is vital. ‘If you’re good at estate agency you can be great at it because the competition is not that good,’ says Rollings. ‘The leadership bit is really important.’ He’s happy to pit his branches against each other, as happened at Foxtons. ‘Your client is the seller,’ he says firmly, looking pained when we move to the tricky subject of gazumping. ‘The problem is: it’s illegal not to pass on an offer to a client.’ Since he rebranded Marsh & Parsons, turnover has shot up from £3 million to £20 million and he boasts a 17 per cent profit margin. House prices are already up another 7 per cent this year. ‘There is just so much money chasing a limited supply of property. I think the market is sustainable. I don’t see interest rates going to 15 per cent like 1992.’ So what could stop it? ‘Terrorism,’ he says in a low voice. ‘A dirty bomb — but you can’t live your life thinking like that.’ Intriguingly. though, he has moved his wife and two sons from Wandsworth back to West Sussex and doesn’t even have a flat in town. Instead he rises at six a.m. every day to drive his Volkswagen Touareg to work. Could that be telling us that the risks of London property now exceed the potential rewards? Mr Positive Energy would never countenance such a thought. But as I ponder the particulars of that half-million pound one-bedroom flat in his window, I just can’t help wondering.
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