Real Estate EP4: Brexit and the UK real estate market

In this podcast, Herbert Smith Freehills’ Matthew Bonye and Tom Leech QC  discuss the important Canary Wharf Group v European Medicines Agency court case.  This case is highly relevant to real estate development. The tenant, the European Medicines Agency (EMA), argues that Brexit is a frustrating event for its lease and that it can assert that the lease is thereby terminated. If EMA wins, then it can only be on the basis that the law of frustration is considerably wider than it is currently thought to be: until now, there is no English case where a lease has ended due to frustration. If a lease can come to an end due to frustration, then how will this affect investment values and therefore development appraisals, particularly for longer-term commercial leases such as those for anchor tenants or whole building lets to major banks and other institutions, often a key element of a development scheme? Matthew Bonye and Tom Leech QC discuss how the law of frustration has developed and whether this may open the floodgates for other claims by tenants where the parties have not legislated in their lease for an unexpected turn of events in the future.

Our Brexit Hub has further in-depth, sector-by-sector Brexit analysis.

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Communal living – flexible renting within a rigid planning system

Co-living is perhaps a concept traditionally associated with the shoestring lifestyle of students. But what about curated workspaces, well-equipped gyms or perhaps even a trip to the spa – all under the same roof?  New flexible living models have already started to spawn across London.  In this post, we look at how law and policy are playing catch up as these new products challenge traditional methods of defining land use.

The capital’s leading developers are taking notice of co-living. There is an unwavering desire amongst the world’s transient young population to work in London. However, traditional home ownership aspirations have been replaced by a realism around the cost of buying property in London. The market for new rental products, focussing on access to luxury facilities and large social networks, carries an obvious attraction.

So what happens when co-living models don’t fit within an existing land use category – where a property may be occupied by different types of users, some for only one night and others for perhaps several years? How should these applications be treated by the planning authority, particularly where they address an identified need?

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