Three months ago, I wrote about the need to prepare for a very socialist Labour government. Since then, both the Labour party and the Tories have inflicted all sorts of harm on themselves thanks to their respective associations with antisemitism and Windrush. All this without even considering Brexit.
What is clear is that events can move so fast that anything can happen in politics at the moment, and this is likely to continue for some time. Both main parties are riddled with internal splits and factions on Brexit, which has now surely won the prize for being the most boring subject for the vast majority of voters up and down the country who just want the government to get on with it.
Both main parties are also obsessed with rumours about their leaders: how long they will last, who might replace them and the manoeuvring being done by potential successors. Although in theory Theresa May looks stronger after the local elections, she is actually weaker. Tory MPs are now a bit less worried that Corbyn would win a general election, if somehow one became inevitable after a Tory leadership battle.
From what I am seeing, up and down the country businesses are pushing on regardless and rightly so. We have been letting space across many regions and have been seeing that companies are investing in both staff and equipment. The vast majority of businesspeople I speak to, in London and elsewhere, are busy.
That is why I am sceptical about the accuracy of the first quarter’s GDP figures, which surprised everyone on the downside. According to serious economists whom I rate, there are real concerns that the Office for National Statistics (ONS) fails to properly capture the digital economy and online retail activity.
Certainly, the strong employment figures across the country do not reconcile easily with the weak ONS data. Unemployment is at a 40-year low and the numbers employed are around record highs.
There is plenty of positive news in the property world. Housebuilding numbers are increasing, with the latest data showing completions in 2017 up 17% on the previous year at more than 163,000 and up 7% on the previous quarter. In South East offices, Colliers International reports that vacancy levels are falling despite lower leasing levels.
Importantly, investment volumes were over 80% up on the Q1 figure in 2017, with a very broad range of domestic and international buyers. In industrial, Colliers International is forecasting near-record take-up of big sheds this year, while investment levels in 2017 were up 80% on 2016 at a new record of £11bn. Surely this confirms that the problems in retailing are due to structural issues, changing customer dynamics and free-market forces moving demand to lower-cost provision.
Meanwhile, London may be experiencing a rare and slight lack of confidence in itself while the regions press on. It doesn’t help that the mayor just complains and whinges, blaming every woe as the fault of the government, Brexit or the US president. He should be highlighting the outstanding investment opportunities; he must provide bold solutions to the challenges of rising violent crime in the city to reassure Londoners.
Fortunately, non-UK occupiers have ignored the politicians, with 90% higher take-up of offices in 2017 than the previous year. European occupiers have rented the highest amount of space for 15 years, and triple the 10-year average… Brexit? What on earth is Brexit? These are classic signs that business folk are ignoring the short-term noise and taking a positive medium-term view about London and the UK.
To finish back with politics, if you want a long-term, slightly speculative investment opportunity, then check out the odds of the next general election being between Emily Thornberry and Ruth Davidson as the two main party leaders.