SURVEYORS JOURNALVOLUME 9 - RETAIL REALITIES - Society of Chartered Surveyors Ireland
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SURVEYORS
JOURNAL
V O LU M E 9
I S S U E 4
W I N T E R
2019
RETAIL
REALITIES
ALSO IN THIS ISSUE
INTERVIEW: BOBBY KERR
SCSI NATIONAL CONFERENCE
REGIONAL FOCUS: ENNIS
NEWS
PRESIDENT’S MESSAGE CONTENTS
n President’s message 4
n Editorial 5
n Business news 6
n Shake up and smell the coffee
FEATURE
12
EDITORIAL
n At your service 16
n Retail realities 18
n Raising the Banner 20
n Future work 22
n Managing the standard 24
INTERVIEW
n Building for better 26
n Society news 30
THE LAST WORD n Surveyor profile 33
n The last word 34
REPORT SURVEYOR PROFILE
Society of Chartered Surveyors Ireland, EDITORIAL BOARD PUBLISHERS
38 Merrion Square, Tom Dunne Chairman Published on behalf of the Society
Dublin 2. John Costello Costello Commercial of Chartered Surveyors Ireland
Tom Cullen Think Media by Think Media
Tel: 01-644 5500 Brian Gilson Lisney
Email: info@scsi.ie Ann-Marie Hardiman Think Media
Web: www.scsi.ie Frank Harrington Smith Harrington Editorial: Ann-Marie Hardiman
Patrick King SCSI Paul O’Grady
Edward McAuley SCSI Colm Quinn
Paul Mooney Benchmark Property Design: Tony Byrne
Paul O'Grady Think Media Tom Cullen
www.scsi.ie Rowena Quinn Hunters Niamh Short
Views expressed by contributors or correspondents Andrew Ramsey Module Surveying and Design Ltd Advertising: Paul O’Grady
are not necessarily those of the Society of Chartered Sarah Sherlock Murphy Surveys
Surveyors Ireland or the publisher and neither the Paddy Shine Dublin City Council ETTERS, COMMENTS AND ARTICLES WELCOME
Society of Chartered Surveyors Ireland nor the Claire Solon Greystar Ireland All submissions will be considered by
publisher accept any responsibility for them. John Vaudin Round Hill Capital the Editorial Board: editor@scsi.ie
SURVEYORS JOURNAL Volume 9, Issue 4, Winter 2019 3
BUILDING
THE FUTURE
IT HAS BEEN A BUSY AUTUMN FOR SOCIETY
STAFF AND MEMBERS ALIKE.
W ith conference and events season truly in full swing, I had the pleasure of meeting
members at our September Property Seminar, and at our National Conference in
November. Our Young Surveyors Annual Dinner was a huge success thanks to Catherine
Connolly, YSCSI Chair, and the wider Committee, as indeed was our PMFM Conference in Croke Park. Attendance
and engagement at these events were exceptional this year, and I would like to thank everyone who attended and
organised – I do hope you enjoyed yourselves.
Last year, our National Conference focused on encouraging connectivity and joined-up thinking. This collaboration
is the foundation we needed to progress to the next stage: Building for Better, the theme of our National Conference
this year. Building a more sustainable future is a goal we must face with action and accountability. The Society needs
to lead the way, and to empower members to connect with opportunities to learn and share ideas. Better buildings
help to build better communities and, as we heard at the Conference, with our population expected to increase
dramatically in the coming years – an additional one million by 2040 and a further million by 2050 – the need for
urgent action is clear. That’s a 42% increase, but crucially, 75% of that growth is earmarked to take place outside
Dublin. Over 360 attendees heard how we need to focus on balanced growth, design-led densified living, and to build
at scale. The challenges are daunting, but they also provide opportunities for Irish society to build a sustainable
future, a future in which surveyors will play a critical role.
New year, new start
We have faced challenging times over the last quarter. The “two Bs” – Brexit and Budget 2020 – have dominated our
conversations inside and outside of work. It is easy to feel fatigued and overwhelmed by these issues and the
conversations surrounding them. Therefore, I encourage all our members to take a real break over Christmas to
recover, rest and reflect on the year gone by. I hope that we can all return in 2020 re-energised, and ready to face
these challenges with renewed vigour.
On this note, we are incredibly excited to kick off the New Year with our new Chief Executive, Shirley Coulter. Shirley
joins the Society from The Bar of Ireland (Law Library), where she was Director of Membership and Public Affairs. I
know Shirley is looking forward to getting to know our members, and to working with the Board and SCSI staff to
support and promote the highest professional standards, to ensure that the profession is strongly positioned to meet
the challenges that lie ahead.
We look forward to seeing you in 2020.
POPULATION EXPLOSION
Ireland’s population is set to rise by two
PRESIDENT’S MESSAGE million people by 2050.
Johanna Gill
President
4 SURVEYORS JOURNAL Volume 9, Issue 4, Winter 2019
SAVING THE WATER WATER EVERYWHERE,
BUT NOT A DROP TO DRINK
HIGH STREET
RETAIL AT BOTH MACRO AND MICRO LEVEL
IS A FOCUS FOR THIS EDITION.
I think readers of this issue of the Surveyors Journal will be particularly
interested in the interview with Bobby Kerr. Well known for his engagement
with high streets, and for his thought-provoking radio programmes covering
the issue where he talks to people at the coalface, Bobby makes some insightful
points about what can and should be done. This chimes with the awareness of many
practising surveyors across the whole of the island, and the recent work done by the
SCSI on the topic. The decline of high streets is not confined to towns in rural areas,
equivalent to:
as is evident from Bobby’s observations about his home town of Dún Laoghaire and
the potential of increasing residential conversion as a solution there.
Bobby also says that the current rates model should be scrapped, and notes that
the SCSI could use its expertise and influence to come up with a workable rates
model. Certainly, putting this together with the dysfunctional Local Property Tax,
and the need to properly resource local authorities, there is a need to reform the
funding of city and county councils.
Lest readers think it’s all over for retail, Neil Bannon’s article, which considers
what’s happening in retail in Ireland, provides some informed insights. Neil notes
the prevailing negativity associated with retail, which does seem pervasive. Drawing
however on his own experience, Neil observes that whereas the demand for retail
units in Ireland has dropped due to the current retail recession in the UK,
there is an increasing presence from European retailers, a trend he says will be
reinforced by Brexit. This is something positive and points to Ireland’s future, with
an economy more closely integrated with the EU and less of an extension of a
dominant nearest neighbour.
EDITORIAL
Tom Dunne The recent boil water notices affecting parts of Dublin, Meath and
Editor Kildare have once again raised the issue of our water infrastructure.
Source: www.thejournal.ie; www.citizensinformation.ie
SURVEYORS JOURNAL Volume 9, Issue 4, Winter 2019 5
MODULE WELCOMES NEW DEVELOPMENTS AT
NICKY MACKIN MYHOME.IE
MyHome.ie has announced a number of new features, implemented for
both users and agents. The company states that it has recently posted record
numbers of visitors, with an increased number of property searches
and property alerts delivered. MyHome.ie relaunched its website during
Surveying and design practice Module has announced the appointment of the summer.
Nicky Mackin to its expanding team. Nicky will work alongside Director of According to MyHome.ie, among the new features it offers are: bigger
Professional Services Andrew Ramsey. According to Module, Nicky is an images; local insights, featuring market trends for an area; and, more
experienced surveyor with a solid background in technical due diligence, information on properties and their surrounds, such as neighbourhood
dilapidation surveying and area measurement reports. Andrew guides, schools, amenities and transport links.
comments: “I’m delighted to welcome Nicky to Module as we expand our In late August, the company launched its weekly estate agent newsletter,
team and foothold in the market. It is great to have someone of Nicky’s which it states is in a bid to keep people up to date and informed about all
calibre join us and assist in providing that extra service to our clients”. that is happening not only on MyHome.ie, but in the wider property market.
This coincided with a new marketing campaign. The site also launched its
Property of the Day feature on the home page, new map search features and
its Inside the Showhouse segment. According to the company, this coincided
with an increase in leads, more agents advertising on the site, and the biggest
engagement rates for any property platform on social media.
MyHome.ie states that it has a range of offers on the way for agents before
the end of the year and new plans on social media.
NEW HIRE AT
SCOTT MURPHY
Scott Murphy Chartered Building Surveyors has announced
the appointment of Simon Ray as a senior Chartered
Building Surveyor. Simon joins the practice following a two-
year stint in New Zealand, where he was employed as a
Chartered Building Surveyor at Veron Building Consultants
in Auckland. There, he was mainly engaged in defect
diagnosis and contract administration on large-
scale domestic remedial projects, focusing on
weathertightness and passive fire issues. Prior to that Simon was with
international consultancy Colliers in their London office.
Stephen Scott, Director of Scott Murphy said: “We are delighted to announce
Simon’s arrival at the practice to supplement our existing team of building
surveyors. Simon’s breadth of experience across a range of sectors and
services will only enhance our ability to continue to provide a first-class
service offering for our many clients”.
6 SURVEYORS JOURNAL Volume 9, Issue 4, Winter 2019
CLAIRE SOLON APPOINTED
MD AT GREYSTAR IRELAND
Claire Solon was recently
appointed Managing Director
of Greystar Ireland, responsible
for private rental sector
(PRS) operations within the
country. Greystar is the
global leader in rental
housing, offering expertise
in investment management,
property management, and
development and construction
worldwide. The company is
actively seeking development
and investment multi-family and student opportunities within the Irish
market, with a main focus on Dublin. Prior to joining Greystar, Claire was
Head of Property at Aviva, where she managed commercial funds of over
€600m, and was responsible for strategy formulation and implementation
within the extensive property portfolio. Claire has held roles as Head of
Estate Management for ESB, and Development Director in Bennetts.
She is a past President of the SCSI.
8 SURVEYORS JOURNAL Volume 9, Issue 4, Winter 2019
A LOGICAL REFURBISHMENT
EXPANSION FOR MAZARS
Logical has announced the appointment of
architect Marian Kelly and building surveyor
Matthew Flood to its team. The company states
that it has spent the past five years growing its
contracting and fit-out division, and both
Marian and Matthew will be instrumental in
driving this growth in the months ahead.
Managing Director Barry O’Halloran states: “It The Building Consultancy has completed the refurbishment
was important to us as a small business to of Mazars’ Irish headquarters.
have a big ambition, and one of those was Mazars’ 35,000 sq ft Dublin office is located at Block 3, The
expanding our business from consulting to Harcourt Centre, Dublin 2. The Building Consultancy states that
contracting. As real estate consultants, MEETING CLIENT NEEDS over seven phases, and within an eight-month period, it
Logical has recently appointed building
supporting our customers in all aspects of completed the refurbishment works, including new mechanical
surveyor Matthew Flood and architect
their business was critical, and increasingly we Marian Kelly. and electrical installations, LED lighting, the construction of
were asked to manage not only their consulting requirements but also their new cellular office spaces, meeting and conference rooms, and
contracting and fit-out needs”. staff showers. Mazars Ireland is a professional services firm
Logical has also recently launched a fire safety business as a direct response to specialising in audit and assurance, consultancy, corporate
customer needs. According to the company, this has proved to be a strong strategic finance and tax. Based in Dublin, Galway and Limerick, Mazars
move as the business is already yielding significant results. Ireland is part of an integrated partnership.
10 SURVEYORS JOURNAL Volume 9, Issue 4, Winter 2019SHAKE UP AND
SMELL THE COFFEE
DRAGONS’ DEN STAR AND FORMER CEO, CHAIRMAN AND CO-OWNER OF INSOMNIA
BOBBY KERR IS PASSIONATE ABOUT IRELAND’S TOWNS AND WHAT CAN BE DONE
TO REINVIGORATE THEM AND MAKE THEM VIBRANT PLACES AGAIN.
B obby Kerr is an entrepreneur and broadcaster, who
appeared on Dragons’ Den and hosts Down to Business on
Newstalk. Before he began life in the public eye and ear,
he was CEO, Chairman and Co-owner of the Insomnia coffee chain. He sold
his share of the business in 2018 to focus on other projects and says even
now, he never wakes up in the morning without something to do.
Bobby is originally from Kilkenny, and his background got him interested in how
Ireland’s small towns could be helped. He has also worked in commerce for most
of his career and opened many shops all over the country. These circumstances
mean that the decline in rural towns has affected him more than others: “I’m
more interested because I’m saddened to see the demise. When you look at all
the boarded-up shops, you look at people moving to the cities, people moving
out. You kind of wonder is this all just going to pass us by? Are we going to wake
A passion for towns up someday and have no villages and wonder where it all went wrong?
Bobby shares a similar interest to the SCSI. He has a passion for the “I would have grown up steeped in rural life. I would have seen small towns,
regeneration of Ireland’s small towns. The Society released a report last small businesses particularly. My father was a businessman in the city of
year entitled ‘Rejuvenating Ireland’s Small Town Centres’. Bobby dedicates Kilkenny and I would have had a great interest in the working commerce
one radio show in every five to this issue. of a place like that”.
INTERVIEW
Colm Quinn
Journalist and Sub-editor,
Think Media
12 SURVEYORS JOURNAL Volume 9, Issue 4, Winter 2019His position as a respected broadcaster allows him to highlight the issue using a regular segment on his radio
programme. He started it around eight years ago and it is called Your Town, Your Main Street, which involves him
and his crew visiting a different town every five weeks: “We arrive into the town on the Friday. We bring a series
of experts with us – town planners, retail experts, landscape gardeners – and they do a positive evaluation of the
space and of the mix of retail, etc., and then we have an open broadcast on the Saturday morning, where all the
traders come and all the business people and, indeed, people who aren’t in business. It’s not a business thing.
We debate it and we talk about it and it has been immensely powerful. I know towns such as Ennis have been
really grateful for us coming and almost being
the glue that gets everybody spurred into action. Life at sea
People really appreciate you coming. That’s what Early in his career, Bobby worked for two years as a chef on
really surprises me, the actual value to the oil rigs in the North Sea: “I worked there in the early eighties.
station for us physically going down is massive”. The money was fantastic and we got paid in Sterling and
lived in Dublin: two weeks on, two weeks off”.
Driven out of town He worked across a range of oilfields: “I worked on the Beryl,
By opening shops in all corners of the country for the Cormorant, and the Brent field. I was there for two years
years, he kept very connected to these issues: “I and it was tough work but very well paid and it was the
also saw the damage that out-of-town shopping school of life more so than anything else. Work hard, play
was doing to these main streets in our towns. It’s hard. Two weeks of heaven, two weeks of hell. That was the
been happening for 20 years”. cycle but it was good. I enjoyed it and the company I was with
Out-of-town shopping centres are just one of the then transferred me to America, so I stayed with them
problems affecting Ireland’s towns, he says: overall for nearly six years. It was great but I was out there
“Parking and restrictions is a second … I think in 60ft waves and God knows what”.
SURVEYORS JOURNAL Volume 9, Issue 4, Winter 2019 13you should forget about charging for parking. As They’ve got a harbour development, which isn’t a workable rates model. I think they’d be the
long as someone parks legally and doesn’t park to everybody’s taste but at least it’s a best placed and best qualified people to advise
there indefinitely, I think they should be allowed development and it’s in proximity to the town. and recommend on that”.
to park safely”. You also have individual retailers, which aren’t Bobby has spoken to the SCSI in the past and
If you are trying to get people to come into towns chains, and the retail drag is short enough. says: “I know lots of Chartered Surveyors and
to shop and use local businesses, he thinks it’s If you look at my own town of Dún Laoghaire, one of my nieces is studying it at the moment.
counterproductive to charge people. He gives his the retail drag is one and a half kilometres. I’ve a lot of friends in the business and people
local town of Dún Laoghaire as an example: It should be a third of that. That’s all I’ve worked with over the years, so I know lots of
“There’s seven parking wardens patrolling the we need and then let people live in the other people in it and I think it’s a great profession”.
streets waiting for someone to pull up and get two-thirds. I saw something recently that
their messages or whatever it is they’re doing. told me that if a shop has been lying idle The long and winding career
That’s so counterproductive to promoting for two years, you can acquire that shop Bobby has had a long career in business and
retailing and business in a town”. and convert it back into residential without broadcasting, and a few accomplishments stand
It is important that towns and businesses are open the need for planning permission. I think if out for him: “I graduated in business and
to change and willing to deliver what people want: that was to happen in Dún Laoghaire, it catering in DIT, worked as a chef on the North
“You have to change according to the marketplace. would solve two problems. It would bring Sea oil rigs for two years, worked in Canada,
That’s one thing I learned a long time ago. If you’re people back into the town centre, living there, worked in America, came back and was the
in a small town in a shop waiting for someone else and it would shorten the main street managing director of Bewley’s when it had 50
“
to sort out your problems, it ain’t going to happen”. considerably”. shops. That was where I cut my teeth. I was 13
years there. I didn’t go out on my own until I was
38. I started with Perk, which became Insomnia
and I’m very proud of the fact that I started with
WHAT ABOUT RESTAURANTS? WHAT ABOUT BARS? one shop and we ended up with 500 over a 20-
year period, which was a lot of work, a lot of
WHAT ABOUT NIGHTLIFE? THAT’S ALL IMPORTANT IN twists and turns along the way but we got there
in the end. I was very happy then to sell my part
THE OVERALL CHEMISTRY OF THE VIBRANCY OF A PLACE. of the business to the existing management
I THINK TO LOOK AT IT AS A RETAIL-ONLY FOCUS IS A
because I want to do a few new things.
“I’m also very proud of my broadcasting career
in Newstalk and Dragons’ Den, which I was on for
MISTAKE. IT NEEDS TO BE MUCH MORE THAN THAT. four years. I did a maritime documentary called
Along Home Shores, so I’ve done plenty of things.
He also believes that the towns that have a The SCSI’s role But I want to do lots more. I want to do a bit more
vision and collective thinking around the assets The level of rates is an issue that Bobby travelling, I want to do a few more bits, not all
that they have, and have some sort of plan for believes is in need of an overhaul: “The current business related. That’s the plan”.
their town “are streets ahead of the ones that model should be scrapped. I think rates should
haven’t. I’ve seen towns where traders on one be paid on the basis of a turnover-based A bit about Bobby
street don’t talk to traders on another street payment. They should only be paid on Although not officially retired yet, Bobby plans to
and wonder why then they’re going backwards”. businesses that have turnover … there could be keep working while spending a bit more of his
With a lot of shopping now being delivered to different bands of percentages agreed for time on leisure: “I’m actively involved now in the
our doorsteps, town centres need to offer more different types of shops, such as a convenience Cliffs of Moher. It’s Ireland’s second busiest
options than retail: “What about restaurants? store versus a furniture shop, whereby the tourist attraction. It’s a UNESCO World Heritage
What about bars? What about nightlife? That’s average spend could be taken into site. We’ve big plans for that, to make it even
all important in the overall chemistry of the consideration. It seems to me to be crazy that bigger and better than it is, and I’m going to be
vibrancy of a place. I think to look at it as a it’s a better use for the property owner to leave very involved in that. I’m excited about that”.
retail-only focus is a mistake. It needs to be the upper floors of his building empty, so he Bobby lives in Dún Laoghaire with his wife Mary
much more than that”. doesn’t have to pay rates, than let somebody and their four daughters and enjoys the
Bobby gives some examples of towns that into them. Crazy stuff”. pleasures life by the sea brings, being a keen
are doing well in the country such as Clonakilty, This is an area where he believes the SCSI sailor. He also owns a house near Key West in
Kinsale, Malahide, Westport and Greystones: could use its expertise and influence: “I think Florida and says he is going to spend more time
“If you look at somewhere like Greystones. maybe they could help around coming up with there and travelling around the United States.
14 SURVEYORS JOURNAL Volume 9, Issue 4, Winter 2019AT YOUR
SERVICE
NEW REGULATIONS WILL SET HIGH PROFESSIONAL STANDARDS
FOR THE MANAGEMENT OF SERVICE CHARGES.
T he new Professional Statement for
Service Charges in Commercial
Property, which will come into
effect on April 1, 2020, will be a major step
forward in commercial property management and
will, for the first time, set out mandatory
requirements for SCSI/RICS professionals. It will
Mandatory requirements
1. All expenditure that the owner and manager seek to recover must be in accordance with the
terms of the lease.
2. Owners and managers must seek to recover no more than 100% of the proper and actual costs
of the provision or supply of services.
3. Owners and managers must ensure that service charge budgets, including appropriate
explanatory commentary, are issued annually to all tenants.
reinforce the need for professionals involved in 4. Owners and managers must ensure that an approved set of service charge accounts, showing
managing these charges to perform their roles a true and accurate record of the actual expenditure constituting the service charge, is provided
with professional scrupulousness, diligence, annually to all tenants.
integrity and impartiality. 5. Owners and managers must ensure that a service charge apportionment matrix is provided
Introducing the Professional Statement annually to all tenants.
with mandatory requirements underlines 6. Service charge monies (including reserve and sinking funds) must be held in one or more
the SCSI/RICS’ intention to set the highest discrete (or virtual) bank accounts.
level of professional standards, and recognises 7. For interest earned on service charge accounts, or where separate accounts per property
the demand in the market for such standards are not operated, a proper and reasonable amount of interest calculated on normal
in the management and administration of commercial rates must be credited to the service charge account after appropriate deductions
service charges. have been made.
The service charge code, as it stands, is 8. Where acting on behalf of a tenant, practitioners must advise their clients that if a dispute
consistently one of the most downloaded exists any service charge payment withheld by the tenant should reflect only the actual sums
documents from the SCSI website. Reference to in dispute.
code-compliant clauses in leases is becoming 9. When acting on behalf of a landlord, practitioners must advise their clients that following
increasingly common and more acceptable to resolution of a dispute, any service charge that has been raised incorrectly should be adjusted
landlords. Indeed, many landlords now require to reflect the error without undue delay.
their managing agents to comply with the code.
Following the introduction of the fourth edition, Core principles
it is expected that the level of compliance across In addition to the mandatory requirements, which represent the minimum acceptable standards
the industry will increase dramatically. of performance, practitioners must also have regard to the best practice principles.
FEATURE
Jerome O’Connor
Specialist Service Charge Consultant,
Mansard Property Consultants
16 SURVEYORS JOURNAL Volume 9, Issue 4, Winter 20191. Service costs n The industry standard cost classifications should be
n All costs should be transparent. Management fees used in reporting budget and actual expenditure.
should be on a fixed-price basis with no hidden
mark-ups. 6. Occupier responsibilities
n Best practice recommends that services are procured n Occupiers should ensure prompt payment of all
on an appropriate value-for-money basis, and that legitimate service charge on-account and balancing
competitive quotations are obtained or the costs charges.
benchmarked. n Occupiers should recognise that the service charge
n Owners should not profit from the provision or supply provision of any lease has legal effect, and should
of services. ensure that any representatives involved in
discussions, meetings, etc., have an appropriate level
2. Allocation and apportionments of responsibility and authority to make decisions
n Costs should be allocated to the relevant expenditure concerning service charge matters.
category. n In recognition that value for money and maintenance
n The basis and method of apportionment should be of quality standards will be enhanced through
demonstrably fair and reasonable to ensure that partnership, occupiers should be proactive in assisting
individual occupiers bear an appropriate proportion of owners in the operation and utilisation of services and
the total service charge expenditure that clearly service systems – for example, by separating waste,
reflects the availability, benefit and use of services. adopting energy-saving measures, etc.
3. Communication and consultation 7. Right to challenge/alternative dispute resolution
n While the owner has the right to set the standards by n All new leases (including renewals) should make
which the investment will be managed, managers provision for either party to require the resolution of
should consult with occupiers with regard to the disagreements through the use of alternative dispute
standard and quality of service charge provision resolution (ADR).
required. n If the parties cannot agree a mediator or independent
n Managers should communicate with occupiers to expert to determine the dispute, the President of the
ensure that services are delivered effectively for the SCSI will, on request, nominate a suitable person.
benefit of all, and to ensure that occupiers understand
what they can expect to receive and how much they 8. Timeliness
are required to pay. n Communication and consultation between managers
n Managers claiming compliance with the principles of and occupiers should be timely and regular to
this Professional Statement should be transparent in encourage and promote good working relationships
demonstrating how they comply with it. and understanding with regard to the provision,
relevance, cost and quality of services.
4. Duty of care n Managers should issue budgets to occupiers,
n Those certifying service charge accounts should including an explanatory commentary, at least one
recognise that they have a duty of care to both owners month prior to the start of the service charge year.
and occupiers to act with professional care, diligence, Detailed statements of actual expenditure, together
integrity and objectivity. with accounting policies and explanatory text, should
n The manager has a duty to manage the property, as well be issued within four months of the service charge
as a duty of care to both the occupiers and the owner. year end.
n There should be clear policies as to how the service
charge will be managed. 9. Transparency
n Transparency is essential to achieving good
5. Financial competence communication.
n When issuing statements of accounts and/or certifying
expenditure, managers should do so in a non-partisan 10. Value for money
spirit, acting as experts. n Service quality should be appropriate to the location,
n The annual statement of service charge expenditure use and character of the property. The aim is to
should be supported by an independent accountant’s achieve effective, value-for-money service rather than
review. merely the lowest price.
SURVEYORS JOURNAL Volume 9, Issue 4, Winter 2019 17RETAIL
REALITIES
CONSUMER DEMAND IN IRELAND IS UP, BUT NEW RETAIL OUTLETS
ARE FEW AND FAR BETWEEN, AND RENTAL
GROWTH IS MODEST.
B efore writing a piece on the retail market, I
should address the elephant in the room:
retail has become a dirty word in the property
market. Investors are happy to buy private rental sector
(PRS), sheds, hotels and offices without recourse to supply-
demand dynamics or potential technological disruption, but
they are spooked by retail. The impact of technology on
The danger of comparison
Now that we have outed the evil internet,
let’s consider what’s happening in
Ireland’s retail market and
this compares to other markets in
how
Europe. Except that’s quite difficult.
Retail is local and consequently direct
Searching for common statistics in such
widely different markets is dangerous.
In a recent representation to a European
institutional investor, we were quoted
vacancy rates that they had been
sent indicating that Ireland suffered
from similar vacancy rates to the
remote working is ignored in the office market, but the ability line comparisons expose different UK. As Bannon is instructed on about
to buy from home has become the obsession of the approaches across Europe and can be 25% of Ireland’s stock of shopping
investment community. Like many issues in the world today very misleading. For example, in Ireland centres and retail parks, we were able
the narrative has drowned out the reality. Retail real estate, we have retail parks – collections of to advise that our composite vacancy
like all other markets, is driven by the dynamics of supply and large sheds beside big car parks where rate was only 7%, significantly lower
demand. What has spooked the market is the arrival of a new in most cases you can only sell bulky than they had been advised, meaning
element of supply it doesn’t understand – the internet. goods due to strict planning restrictions. that either the stats they had been given
Online shopping is just another form of supply into the In France they have a lot of retail were incorrect or the rest of the Irish
market, another conduit through which consumers can warehouses but they can sell anything market is having a torrid time and the
purchase products and services. It has a different impact on from shoes to deckchairs, and in most owners of these assets should appoint
different products and services because some, such as cases they are stand-alone boxes. Bannon quickly to sort out their vacancy
music, are easily supplied online, whereas others like getting In the UK, shopping parks with the same issues. The same problems arise with
your hair cut or buying a cup of coffee are clearly not. Most form of development but with much respect to rates per square metre,
things we buy fall somewhere in between and can be acquired greater open use are more common. growth in rents and yields. Euro-wide
through multiple channels, and it is in this non-binary world In Germany, the supermarket business stats should be taken as a broad
that retailers are targeting consumers. A simple way to think is dominated by discounters who in large guideline only. We look beyond the
of the impact of online is as additional supply into the market part rent their stores, whereas in Ireland statistical morass to what makes retail
because, as with all markets, the supply-demand dynamic around 90% of the supermarkets are really tick, which brings us back to the
will ultimately determine value. owner occupied. supply-demand dynamic.
FEATURE
Neil Bannon
Chairman and Head of Consultancy,
Bannon Property Consultants
18 SURVEYORS JOURNAL Volume 9, Issue 4, Winter 2019“
Stagnant supply
Supply in the Irish retail market has been stagnant for over a decade.
Other than a couple of stragglers that were committed to construction
STRIKINGLY, THE US, WHERE
when the lights came on in the casino in 2008, nothing has opened and
nothing new has been started. This makes physical supply very easy to
ALL THE SCARY MOOD MUSIC IS
measure. During the recession Bannon databased the entire market,
and keeping it up to date to accommodate new supply has been
COMING FROM THAT THE INTERNET
depressingly easy. There have been some stand-alone supermarkets IS GOING TO KILL SHOPS,
but the pace of new development here has also been light and mainly
focused on openings by the discounters Lidl and Aldi. The mainstream HAS SIX TIMES THE SUPPLY OF
supermarket players are currently opening stores at the rate of one
every five years. THE IRISH MARKET.
Goodbody Stockbrokers measured the supply in the Irish market per
capita in 2017, which showed us to be mid table in Europe, and 20% less
than the UK. Strikingly, the US, where all the scary mood music is
coming from that the internet is going to kill shops, has six times the The current retail recession in the UK means that this demand has
supply of the Irish market. Think of the five biggest shopping centres dropped dramatically. We lease a retail portfolio for Oaktree and Sigma
near you and then imagine there’s five more of each of them within easy Retail Partners, and recent analysis of their portfolio shows that only 18%
reach and you get a sense of the oversupply in that market. Since the of leasing has originated from the UK, with increasing presence from
Goodbody report the supply ratio has further improved as the population European retailers. This trend is likely to be reinforced by Brexit.
continues to grow, whereas new retail supply is minimal. There are now So, in summary, the Irish retail market is in good shape, largely full and
500,000 more people in Ireland since we last built a new shopping centre supported by an excellent demand-supply dynamic in terms of consumer
and the pipeline for new retail centres is limited to the Special demand and muted development. However, rental growth is modest as we
Development Zones (SDZs) where retail is required to match the large wean ourselves off an over-reliance on the UK-based retailers. When
increase in housing supply. investors will get over their irrational fear of the sector is anyone’s guess.
UK woes
Since the low point of the recession in 2012, retail sales have grown by 34%,
household disposable income has grown by 7%, and consumer savings are
now at an all-time high, as is household net worth.
Supply is stagnant but consumer demand has grown strongly, so
rents should be charging ahead.
But growth has been modest.
The reason has been the poor
demand for space from UK
retailers. Traditionally, UK
retailers dominated demand
for Irish shops, in many cases squeezing out
domestic players. By way of example, 11 shopping
centres opened in Ireland in 2007 (Bannon let seven
of them). They all opened fully let and UK retailers
dominated, especially in the fashion space.
In Athlone Towncentre over 70% of the space was
occupied by UK-based retailers.
SURVEYORS JOURNAL Volume 9, Issue 4, Winter 2019 19RAISING
THE BANNER
ENNIS IS THE COUNTY TOWN OF CLARE AND A €1.6M
PROJECT IS ABOUT TO GET UNDERWAY TO
REGENERATE ITS MEDIEVAL CORE.
E nnis residential surveyor Tomás
Lees’ view is that the property
market is performing well in the
town. However, he says that it was stronger last
year: “There are seven or eight residential
schemes ranging in density from 10 or 12
houses to 50 houses. They’re selling but not at
There is not much industry in Ennis but its location makes it ideal for those who work in Ireland’s
western cities but prefer living in a smaller urban area. Limerick and Galway are within easy drive
and the industry around Shannon and Shannon Airport is even closer.
Tomás says that the rental market in Ennis is starved for supply: “It’s so difficult for anyone on the
ground down here. I had an open viewing of a two-bedroom apartment last Friday. The rent on it was
€850 and I think we had something like 13 or 14 people turn up. It’s really difficult, and it’s hard to see
how they’re going to tackle that because a lot of the landlords we have would have one or two units.
a great pace. I think that’s mirrored in a lot of They’re accidental landlords more than anything and they’re selling up and moving out of things”.
satellite towns like we are”. At the time of writing, an internet search on Daft.ie showed just 16 properties for rent in Ennis, while
A major transformation of the picturesque there were 202 for sale.
medieval streets of Ennis town centre is due
to get underway in early 2020. The Ennis Issues in Ennis
Town Centre Public Realm Regeneration While the proximity to Limerick and Galway offers job opportunities, those cities also offer shopping,
Project will see €1.6m invested in two projects. which can take away from the retail in Ennis. But Tomás says there are steps that could be taken
One will regenerate one of the main shopping that could kick-start retail: “I find rates a particular barrier for anyone to come in and set up or take
streets, Parnell Street, and its lanes and a chance on anything. They’re excessive. To give people a chance to get going, I think if there was
bow-ways, and another will cover Barrack some rebate or something done on that, it might entice people to come in and have a go”.
Square, Old Barrack Street, O’Connell Street Tomás was asked where he would like to see Ennis in five years’ time: “The ideal scenario for our
and High Street. own industry would be to have a functioning, level property market, where everyone gets a fair crack
Tomás says: “That’s starting in January or at things. There’s talk again of wheels in motion for a data centre where Clare County Council has
February next year. That’ll really help that part rezoned land outside of the town here for a proposed €400m data centre, in light of the Athenry one
of town. It’s a long time coming but it’s en route that didn’t happen. Something like that would certainly be very welcome if we got someone in to
now. That’ll help rejuvenate it certainly”. take that up … it would give the area a massive boost”.
FEATURE
Colm Quinn
Journalist and Sub-editor,
Think Media
20 SURVEYORS JOURNAL Volume 9, Issue 4, Winter 2019Rental and house prices Parnell St Tulla Road
Average three-bed semi asking price in redevelopment Planning permission has
Co. Clare: €200,000; 11.7% increase on €1.6m has been allocated to been sought to build 68 units at
last year; third largest rise in the country Clare County Council for the Ennis Roslevan, off Tulla Road. Datcha
after Donegal and Westmeath. Town Centre Public Realm Construction wants to build one
MyHome.ie Q3 2019 Property Report Regeneration Project to rejuvenate detached, 18 semi-detached and 41
Parnell St, Barrack Square, Old
terraced houses, along with an
Barrack St, O’Connell St
Average rent in Co. Clare: apartment block of eight
and High St.
€858 (quarter-on-quarter units.
change 3.1%/yearly change
11.2%).
Daft.ie Irish Rental Report Q2 2019
Ennis Trad Fest
Each November, the town holds
the Ennis Trad Fest, which brings
trad musicians from all over Ireland
to different venues around the
town and draws tourists for
a celebration of
Irish music.
M18
Ennis – a good base
Ennis lies 20 minutes
from Shannon, 30 minutes from
Limerick and an hour from Galway.
These are three main centres of
industry in the west and many
people living in Ennis work in
one of these places.
Ashline
Ballymacaula social housing Sycamore Drive
View €7.8m has been allocated for the 47 A-rated houses, with air
42 family homes are now building of 40 social houses on this pumps for heating. Phase 1, of
available here. There are site under the Rebuilding Ireland semi-detached houses, was
two-, three- and four-bed scheme. Clare County Council completed in summer 2019. Phase
2 is two terraces. The final phase
semi-detached and detached recently won a court case against
will feature detached four-
houses available. people opposed to the
and five-bedroom
development.
houses.
SURVEYORS JOURNAL Volume 9, Issue 4, Winter 2019 21FUTURE
WORK
BUSINESSES AND PROPERTY PROFESSIONALS NEED TO WORK TOGETHER
TO CREATE SUSTAINABLE WORKING ENVIRONMENTS THAT ATTRACT
TALENT AND REDUCE CARBON FOOTPRINT.
T his is a unique period in the history of the workforce.
Today’s workplaces employ as many as four different
generations under one roof (Gen Z, Millennials, Gen X, and
Baby Boomers), all with distinctly different experiences and expectations
of what their ideal workplace should consist of. In addition, as
globalisation continues, the wage gap between the rich and poor nations
is narrowing, and the cost and availability of qualified employees is
Businesses recognise that they must adjust
their workplace landscape so that they
competitively position themselves to retain and
attract new talent by creating a workplace where
people want to work.
Businesses who engage in sustainable practices
not only achieve happier employees, which leads
increasing while, simultaneously, competition for the most qualified to increased productivity, but can also achieve
employees is also increasing. As a result of this, businesses are rapidly greater profits as a result of operational
evolving their workplaces to embrace the diversification of the workforce efficiencies. For example:
and win the war for talent.
By 2025, Millennials (those born between 1981 and 1996) will comprise 75%
of the total global workforce. Studies indicate that Millennials are looking for
a workplace that not only offers prospects and great leadership, but also
promotes workplace ergonomics and staff well-being, encourages
collaboration and engagement, provides access to experiences, and
champions environmental best practices. Studies have found that Millennials
and Centennials are environmentally conscientious and have a strong desire
to engage in best practice. According to a 2015 survey by the Society for
Human Resource Management (SHRM), 51% of businesses that engage in
environmental and sustainable practices attract top talent, and employees
are more likely to stay longer with a company because of the organisation’s
sustainability programme.
FEATURE
Tara Giles
Director, Aramark Property
22 SURVEYORS JOURNAL Volume 9, Issue 4, Winter 2019“
n controlling air flow by monitoring the carbon ORGANISATIONS HAVE TO SHIFT THEIR MENTALITY FROM
dioxide level in the air will considerably reduce
plant running hours and create a more CREATING A PLACE WHERE THEY ASSUME PEOPLE NEED
welcoming environment;
n providing shower facilities encourages active TO WORK, TO CREATING AN ENVIRONMENT WHERE
PEOPLE WANT TO WORK.
commuting and exercise;
n providing breakout and relaxation areas and
providing healthier food in the office
restaurant/canteen can translate to increased JACOB MORGAN, FOUNDER OF THE FUTURE OF WORK COMMUNITY.
energy levels and encourages staff well-
being; and, Workplace sensors document, drafted by the managing agents, is a
n properly managing waste segregation and Occupancy monitoring good reference document for steering and
switching to LED lighting reduces carbon Motion sensors under desks and in meeting supporting occupiers on their sustainability journey.
footprint and costs. rooms measure real-time occupancy. This data This guidance document, which should form part of
can be used to determine what meeting rooms are the tenant handbook, is intended to provide the
In addition, sensors can provide insight into available and how many desks are unoccupied occupier with realistic measures that will make a
workplace practices in real time. The sensor data, within a particulate date period. This information difference to the environment, as well as delivering
when analytically compiled, can aid operational can be particularly valuable to businesses that are cost efficiencies within their business. The inclusion
decisions and workplace efficiencies. approaching a break option or lease expiry date, of this guidance document in the tenant handbook
and are reviewing their business requirements in demonstrates a landlord’s shared commitment to
terms of quantum of floor space. For example, delivering sustainability best practice.
does a business need the volume of floor space
currently being occupied? Is there a reduction in Landlords’ sustainability plan
desk occupancy due to increased remote working? Developing a strategic sustainability plan forms a
Can a business reduce floor space or the number framework for setting clear, specific and
of desks, and introduce a bank of hot desks? measurable targets for the property, which will
ultimately contribute to the occupier’s sustainable
Predictive cleaning working environment, for example:
Motion sensors in bathrooms, meeting rooms and n reducing energy consumption;
food service areas collect information about usage. n reducing water consumption;
This can provide a more holistic approach to n reducing waste going to landfill;
cleaning by allowing a facilities manager to deploy n improving biodiversity;
a more cost-effective cleaning regime, which will n improving occupier ambience; and,
ultimately improve productivity, and reduce costs n improving on-site services.
and the unnecessary use of cleaning detergents.
The sustainability plan must take account of
Environment monitoring all stakeholder goals and commitments, i.e.,
Sensors located in various parts of a workplace or environmental, social and corporate governance
building can measure humidity, CO2 and light to (ESG) commitments and sustainability
ensure comfortable working spaces for accreditations, and this can only be realised and
employees. Temperature sensors can also add achieved through continual engagement between the
value by monitoring the performance of the landlord and tenant. An example of such
heating and cooling systems with a view to engagement is a tenant travel survey, which might
controlling temperature at the desired set point. identify the demand for common area bicycle storage
and shower facilities/drying room, and the need for
It is important to note that the creation of a improved onsite services such as bicycle repairs.
sustainable workplace does not rest exclusively All stakeholders must engage and work together
with the occupier. Landlords also have a role to to offer the highest-quality environment. This is
play and therefore it is essential that sustainability critical to long-term stakeholder partnerships,
is integral to how property assets are managed. which will lead to enhanced asset value for
A sustainability guidance property investors.
SURVEYORS JOURNAL Volume 9, Issue 4, Winter 2019 23MANAGING
THE STANDARD
A NEW INTERNATIONAL STANDARD WILL HELP FACILITIES
MANAGEMENT PROFESSIONALS TO IMPROVE SERVICES
AND BETTER SUPPORT THEIR CLIENTS.
I am often asked: what is facility management (FM)? Most people don’t realise that
if they are working in an office, visiting a hospital or going to any large building,
they are interfacing with many of the services, such as cleaning, security and
building maintenance, that fall under the discipline of FM.
FM has grown over the last 30 years from being a back of house function that was often managed
across multiple departments to a strategically important function within an organisation.
According to Forbes magazine, the global outsourced FM market will be US$1 trillion by 2025.
Management systems can be deployed for
a variety of reasons, such as quality,
environment, health and safety, or work
environment. These are not systems that
should operate in isolation from each
other, but should be part of an integrated
business system. In many organisations, these
FM is a discipline that needs to balance the rapidly changing needs and demands of the various systems are ‘controlled’ independently of each
stakeholders that it serves with effective, safe and sustainable business needs. It affects the other, which leads to fragmentation and
health and well-being of all those who come in contact with an organisation, and covers a wide inefficiency.
range of areas including occupancy costs (the second highest overhead in almost every
organisation), health and safety, use of space, maintenance, security, cleanliness, environmental How will ISO 41001 improve FM outcomes?
performance, and more. This standard provides a framework for
FM delivers workplace solutions that assist organisations to attract and retain highly skilled integrating the various disciplines and services
employees, and is an essential aspect of organisational success, which is why, in 2018, ISO within FM. The PDCA method is used as a
41001:2018 was published. This management systems standard, with guidance, provides a structure to ensure that policies and measures
framework to help the FM organisation continuously improve services, providing organisations are optimised so that FM can support the
with a structure for FM that can be certified to international best practice. objectives of the client (“demand organisation”
in the use of ISO41001).
Why is a management system important for FM? An important principle of this standard is that
Management systems are those activities that are used to anticipate, avoid or solve known there is regular co-ordination between the
problems. As such, an FM management system is nothing more or less than a series of senior management (leadership team) of the
agreements for policies and measures that form the basis for continuous improvement and demand organisation and that of the FM
adaptation to the rapidly changing market. It is therefore not a static document but a systematic organisation. Through this “strategic
approach. The ‘Plan-Do-Check-Act’ or PDCA cycle is an important tool in this regard (Figure 1). dialogue”, the objectives of the demand
organisation become clear and it becomes
possible for FM to align its strategy and policy
FEATURE closely with those of its client(s).
David O’Brien Figure 2 is taken directly from the standard. It
Managing Director and Co-Founder
indicates the interrelationship between the
of Acacia Facilities Management
demand organisation and the FM organisation.
24 SURVEYORS JOURNAL Volume 9, Issue 4, Winter 2019“
BY IMPLEMENTING ISO 41001,
THE FM ORGANISATION WILL BE
STRATEGICALLY ALIGNED WITH
THE DEMAND ORGANISATION AND
THEREFORE WILL PROVIDE A
PROACTIVE SERVICE RATHER
THAN A REACTIVE SERVICE.
It’s important to point out that for an in-house PROCESS LEVEL
FM department, the demand organisation is
the organisation that employs the FM team.
OPERATIONAL
By implementing ISO 41001, the FM FIGURE 1: The LEVEL
Plan-Do-Check-
organisation will be strategically aligned with Act or PDCA cycle
the demand organisation and therefore will is an important
tool in FM.
provide a proactive service rather than a
reactive service. For example, through ISO
CORE BUSINESS STRATEGY SUPPORTED BY FM
41001, the FM organisation would have aligned
its strategy to the business needs of the
DEMAND ORGANISATION
demand organisation, which could include FM STRATEGY
expansion or contraction of the property (FM)ORGANISATION
portfolio. All too often the FM organisation is 10. IMPROVEMENT FM POLICY
not aware of changes in the demand
organisation’s requirements that will have a IMPROVE
material impact on the service the FM ACT 4. CONTEXT
department provides, which results in a 9. PERFORMANCE 5. LEADERSHIP
MEASURE CHECK PLAN FM PLANS 6. PLANNING
EVALUATION
reactive response that is inefficient and costly.
7.SUPPORT
DO
FIGURE 2: The
So who is behind developing ISO 41001? interrelationship IMPLEMENT
Technical Committee TC267 develops the ISO between the demand
organisation and the 8. OPERATION
41000 suite of standards. The Committee is FM organisation.
chaired by Stanley Mitchell who, when
questioned about the standard, said: “Every
company, big or small, has some element of Why not get involved? experts for the industry they work in. Without
facility management. It is a complex discipline In June this year Ireland hosted the Technical industry experts becoming involved in the
that directly affects everyone, as it is all about Committee in the headquarters of the National development of standards there wouldn’t be
the spaces that we occupy and how those Standards Authority of Ireland (NSAI) in Santry. any standards for us to use as international
spaces meet the needs of the people who use Technical Committee meetings are held twice a best practice guides for the development of
them on a daily basis. ISO 41001 is the first year in different participating countries across industry-specific management systems.
standard of its kind for facility management the globe and this year was Ireland’s turn. Becoming involved in standards development
and has the potential to make a real difference Many people think of standards being is a great way to network with experts from
to organisations by improving workforce health developed and written by technocrats who are across the globe, to understand the common
and safety, reducing their impact on the supported by bureaucrats, which couldn’t be issues that we have within our industry, and
environment, and making considerable cost further from the truth in my experience. to collaborate to develop internationally
savings and efficiencies”. Standards are written by industry practitioners/ accepted solutions.
SURVEYORS JOURNAL Volume 9, Issue 4, Winter 2019 25BUILDING
FOR BETTER
THE SCSI’S NATIONAL CONFERENCE TOOK PLACE IN A CROWDED
MANSION HOUSE IN DUBLIN ON NOVEMBER 6.
O
Better rental
Iain Murray of LIV Consult spoke on build-to-rent. Ireland stands to
benefit from coming relatively late to this market, learning from
ver 300 delegates from all branches of the profession experiences in other countries. Diversity is key to build-to-rent – the
heard from an impressive array of speakers on the market must supply every tenancy type from five-star to affordable
conference theme of ‘Building for Better: Better rental, and every stage of life, from student accommodation to
Buildings, Better Communities’. retirement housing, with appropriate services for each customer type.
Conference MC Valerie O’Keefe introduced SCSI President Johanna Gill, Iain discussed the long-term nature of the investment in build-to-rent,
who gave a warm welcome to those present, saying she hoped they would another game changer in an industry where the investment often ends
find the conference “enjoyable, beneficial and a bit inspirational”. Johanna when a property is finished and sold. He said that getting from A to Z on
spoke about the changes Ireland has seen in the last 20 years, and what a build-to-rent project is complex, but praised An Bord Pleanála’s
the next 20 might bring. One of the biggest challenges is sustainability, Strategic Housing Developments (SHDs) as having been helpful for
which is no longer about lifestyle/personal choice, but affects every the sector.
section of society. She said that better buildings are better for all
stakeholders, as well as the environment, and surveyors are well placed Better data for operation
to be part of the necessary change: “We need to think big, be ambitious, Enda McGuane of Winters Property Management was up next to talk
start doing, make a difference”. about managing building facilities through technology. He spoke about
She asked delegates to consider getting involved in the SCSI, even in a building information modelling (BIM), and the level of planning needed
small way, saying that while it can be challenging, it is also very rewarding. from the very beginning of a project in order to use BIM to its full
She thanked the event’s sponsors and exhibitors, in particular main potential. He pointed out that in the traditional build-to-sell model,
sponsors Cushman & Wakefield and The Irish Times. property and facilities management professionals typically come into
the process at the end, and by then much valuable data has been lost.
Every professional group of the SCSI has a role to play in making sure
CONFERENCE REPORT that the right data feeds into the right environment. He said that we
Ann-Marie Hardiman should be looking at buildings not just as physical assets, but as data
Managing Editor, assets, and recommended that the SCSI develop a business case for
Think Media
clients on the benefits of BIM.
26 SURVEYORS JOURNAL Volume 9, Issue 4, Winter 2019You can also read
