Dealmakers lunch where the customers are, so the City is going west
eoffrey Ackroyd was the partner in Cazenove who developed a strategy for lunching: 'The Savoy,' he
– would say, 'is a jolly nice little place for lunch, and nice and handy, because you can get there on a number 11 bus.' New strategies will now be needed, for the City is drifting westwards, and Angelo Maresca is showing the way. For two decades he was the impresario of the Savoy Grill, Geoffrey Ackroyd's nice little lunch spot and sometimes known as the Dealmakers' Arms. Then the management ordered a revamp, a clash of wills broke out between the Grill's modish new chef and its unreconstructed City customers, and Mr Maresca retired gracefully — but now that he is popping up again, with equal grace, to help Sir Rocco Forte give the kiss of life to Brown's Hotel, will the dealmakers go with him? They would have to hack their way across to the West End of London, but some of them are there already. Lazards, a great City name, has moved out of its nondescript City office and set up shop in suitable style, round the corner from Mr Maresca. The Fleming family sold its bank in the City and has started again in the Bishop of Ely's eighteenth-century town-house in Dover Street. A friend who is moving there says that she will be well placed for the Ritz and the Caviar House. The Hambros moved west long ago, taking the view that dealmakers did not need all of a merchant bank's trappings, and Rupert is based in the floors above Wiltons. the family's restaurant. One motive, even stronger than lunch, drives the dealmakers. They need to be close to the customers.
A bus-ride too far
Times have changed, and although the City stands where it did, the shocking truth is that some of its putative customers now find it a bus-ride too far. Private bankers look after their flocks from behind discreet brass plates in Mayfair and St James's. Clients like theirs may have flown from the Gulf (or even Moscow) and think that they have done enough to reach the part of London where the hotels and shops and restaurants and clubs are — why go further? Tycoons, too, may measure their day's work in terms of distance from the airport. Corporate head offices have been moving in that direc tion. BP has abandoned its Lutyens palazzo in the City for St James's Square. Imperial Chemical Industries wanted to be near the Heathrow Express, which, when on form, Lakes 15 minutes from Paddington Station. Kingfisher and Marks & Spencer have opted for Paddington Basin. A City friend saw this coming when he was urged to move his investment bank to Docklands, 'It's hard enough,' he told me, gesturing down the river, 'to get clients to come this far„ „
Between two fires
Now the City finds itself caught between two fires — between the lures of the West End and the pull of the financial factories on its eastern horizon, clustered round Canary Wharf. Their competitive advantages are real but could not be said to include location. An earlier generation of bankers lost heavily by lending to Canary Wharf, a new generation is thinking of buying it out, something like .E2 billion of public money has been spent on roads and railways to support it, but it still takes 25 stops on the Tube, and one change of line, to get from Canary Wharf to Heathrow. No wonder the investment banks have bought their own townhouses, far from their factories, where they can meet their clients. Dealmakers who still have the choice are likely to go to where the business is, and I expect that more of the City's business will go west.
As good as gold
Gold and governments are in competition, which is why they will always make it hard for you to buy it. Its value does not depend on ministers' promises or central bankers' signatures. Gordon Brown did his best to bomb it, selling off half the nation's reserves on bargain-basement terms. Not long ago you could have been arrested for buying gold, and even now you would set off the alarm which, in theory, is set to catch money-laundrymen. No wonder that the banks cannot be bothered to stock it. They will happily arrange to sell you almost any other store of value, but try asking them for an ingot and see what you get. With a bit of luck they will soon offer you the next best thing: shares in gold bullion. The World Gold Council is launching a fund, backed by gold tucked away in HSBC's vaults. If you would prefer to tuck it away in your own vaults, you might want to know that in Wembley and Southall gold bangles are sold by weight and, because they sometimes help to pay the fare to India, are known as tickets. Indians like to have their gold, or some of it, where they can see it. Promises to pay are not in the same class.
Buyers' market
Poor old Drax. Won't somebody let it in though the cat-flap and give it a saucer of milk? That mewing noise comes from our biggest power station, whose previous owners have turned it out of doors and disavowed it, accusing it of eating them out of mouse and home. Drax's trouble has been that, for the first time in recent history, we have an efficient market in electricity — which sent prices tumbling down, much to the customers' benefit and the suppliers' annoyance. This is a buyers' market in action, and scarcely suggests. any more than New York's blackout does, that we are heading for power cuts. The buyers may now have had the best of it, for the price has begun to edge up, and is bringing spare capacity (this week, at the Isle of Grain) back into action. Drax, too, should find a new owner, though its creditors will have to grin and bear their lot — just as long as we do not expect to keep the lights shining by blowing the heads off dandelions. Drax burns coal.
Bankers' grouse
Grouse are back in the City, in Leadenhall Market, but the bankers are still away, shooting them. These efforts, they sometimes feel, should be more warmly appreciated. When Duncan Mackinnon, the sporting chairman of Smith St Aubyn, returned to White Lion Court in September, his deputy greeted him: 'Had a good holiday, Duncan?' The chairman glowered: 'If you think shooting grouse six days a week is a holiday, you must be mad.'
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