Thread by @TihoBrkan

1/ We believe a fantastic investment opportunity exists in the #London luxury real estate market today.

This is a thread for those interested in investing alongside our family business.

Here is what we see and why we like it. 👇

2/ Our family has worked in the single-family luxury market for over two decades but has never done anything in London (yet).

So naturally, as we watch London's prime center go through a 5-year correction of -20%,

We've started paying attention!

3/ Since most private investors aren't cross-broader allocators, they aren't focused on relative price changes between markets.

Before #Brexit, before UK's stamp duty hikes & before COVID-19,

London was the most expensive luxury market in the world on a $USD sq/ft pricing.

4/ A lot has changed in the UK since, including a massive drop in the British Pound.

This is making the UK's real estate more attractive for the global investors whose capital does cross borders in search of relative value and outstanding deals.

$GBPUSD

5/ London's prime central market is one of the few cities where prices have corrected meaningfully for $USD denominated investors — falling from $5,600 per sqft towards $3,300.

A fantastic discount, which obviously won't last forever!

6/ The famous central suburbs of the city, which you probably remember from Monopoly, have been discounted aggressively!

Mayfair down -25.2%
Earl's Court -22.7%
Chelsea -23.8%
Knightsbridge -21.0%
Belgravia -20.5%
Kensington down -20.9%
Notting Hill down -15.6%

7/ As they say in Economics 101, the cure for high prices is high prices. London center has corrected since the summer of 2014.

However, the correction also depressed sentiment, with future planned supply remaining depressed for the 4th year running.

Shortages are now looming!

8/ @Savills and @knightfrank are forecasting pretty similar outcomes for London's luxury market over the coming 5 years.

The base case view is:

Prices are making a bottom in 2020, with a strong rebound occurring in 2021, '22, and '23.

9/ We believe there is a possibility the recovery ends up moving back towards all-time highs (1st chart).

In that case scenario, there is a potential for at least a 25% to 30% increase over 5-6 years from the current levels, just to return back to par in 2014.

#buylowsellhigh

10/ However, price increases aren't apart of our strategy — it's are just a bonus for those who invest wisely.

Our family business is luxury construction and we have a multi-decade proven track record of adding value to prime location projects (pictures below).

11/ Furthermore, we have been investing in London's resi-developments for years, sponsored by "best in class" developers, while we've held passive exposure via mezzanine debt.

As a result, we've gained a load of great connections, giving us the confidence to proceed on our own.

12/ Currently, we have some very attractive deal flow with lower entry project values from £5 million single door rehabs,

All the way to £60 million for heritage-listed development projects pictured below — located meters from Hyde Park.

13/ If you are an HNW investor, a family office, or a family business with luxury RE experience,

We are looking for partner(s) to take on London's bargains.

Please contact us via direct message here on Twitter or by visiting our landing page.

theatlasinvestor.com