A year after taking over the residential arm of property firm Keppie Massie, Berkeley Shaw Group is now stepping up its expansion by opening a new 10,000 sq ft Liverpool HQ. Tony McDonough reports
Residential sales and letting business Berkeley Shaw Group is relocating to a new 10,000 sq ft headquarters in Liverpool city centre.
And, in an interview with LBN, Berkeley Shaw managing director John Baybut has laid out ambitious expansion plans for the business saying he wants to double its turnover in the next three years.
John took over Berkeley Shaw from Mike Shaw in 2014. At that time it had just one estate agency in Crosby. Now it has opened further outlets in Formby and Southport and has also been operating in Rumford Place in Liverpool city centre since acquiring the residential arm of Keppie Massie a year ago.
Now it is moving into 10,000 sq ft of office space in a former dance school called The Ternary in Old Haymarket. John said: “That is a flagship statement office in the heart of the city centre. Rumford Place is a lovely building but you don’t get enough people walking past when it comes to promoting residential property.
“We now have almost £1bn of properties under management. We manage around 70 different blocks and lots of individual properties – that is a lot for a local agency. It has around 3,000 units under management across Liverpool city region.”
John’s ambitions for the expansion of the business will almost certainly mean a growth in headcount and John is already making Berkeley Shaw an attractive proposition in what is a competitive recruitment market.
In the last few weeks Berkeley Shaw has raised its staff salaries by 10% as inflation has soared. John explained: “How do people afford to live, how can they afford to eat and heat their homes?”
And on the working from home debate, he added: “There is a lot of discussion around whether people are better working from home or working in the office. My view is that there isn’t a straightforward answer to that and that people are different. You have to be able to accommodate different work-life balances.
“But what I want to create is a place where people really want to come into work. I can have a great day working from home and get a lot done. But it is not always the best thing for culture and for leadership and meeting clients and building a business.
“You have to have a central focus but you also have to motivate people to come in and enjoy working with each other. We want this to be a place where staff and clients are enthused to come here and do business.”
Berkeley Shaw acquired KM Real Estate from Keppie Massie owner Ged Massie in April 2021. Keppie Massie is best known in Liverpool for its work in the commercial property sector. John has kept the two distinct brands in the group – Berkeley Shaw Estate Agents and KM Real Estate.
“Berkeley Shaw focuses on residential sales, residential lettings and landlord management and also what we call block management. Its city centre block management deals include Wapping, City Quay Park Central, Quay Central and Beetham Tower,” said John.
“These are really good city centre flagship developments. We are positioning ourselves as the go-to agent in the city region for those types of developments. We are not a huge big corporate beast but we are doing pretty well.
“Our traditional sales and lettings patch has been Crosby and Formby. We have sold footballers’ houses in places such as Formby and Blundellsands. When I took over I wanted it to be a little more user-friendly. I took the edge off the highbrow brand a little bit. We can sell £150,000 houses and we can sell million-pound houses.
“Discretion is always important when you are selling an expensive house for high-profile customers but you also need to make sure you can market it. So it is always a delicate balance. We have done deals for Liverpool and Everton footballers.”
In October last year Alan Bevan, managing director of another agency, City Residential, warned the pipeline for quality apartments in the city centre had slowed down and that the supply of new homes for sale and rent in Liverpool city centre had hit a 10-year low.
John agrees about the lack of quality stock in the city centre. Potential first-time buyers who were struggling to raise deposits have turned in higher numbers to renting. And they are insisting on higher standards. And he added delays in getting developments through the planning system was exacerbating the problem.
He explained: “Expectations of renters now are much higher than they used to be. People are much less prepared to live in poor quality accommodation. There are some good quality, fantastic apartments in the city centre. But there is too much stock not meeting that standard.
“There is a supply problem in the city centre right now. Everything that is coming in is flying out again. I would love to have more properties on the market to let. We will get 15 to 20 applicants for a city centre apartment if it is any good.
“Developers are being refused permission on developments. The planning process is now so long in Liverpool and this is adding to the problem. It is right that there should be a process but because of how slow it is, it is putting off investors and developers from doing deals in the city.”
John is broadly supportive of landlord licensing schemes, such as the one just re-introduced in Liverpool. However, he also acknowledges that, in many cases, landlords will pass on the cost to renters – pushing up rents further and adding to the cost of living.
“Landlord licensing schemes do focus the minds of landlords in making sure the property is of the right quality,” said John. “There are rogue landlords out there but not as many as people imagine. Even then they want their assets to rise in value.
“If I, as a landlord, have to spend £500 per property on a licence then it is likely most or all of that will be passed on to the tenants. Those costs will always pay for the better quality and better standards.
“What Liverpool really needs right now is good property professionals in all parts of the market. We are proud of the fact that we are highly-qualified RICS-regulated professionals. I am a chartered surveyor as are a number of people on my team. We need more of that in the city.”
During the pandemic there was a “flight to the suburbs” in Liverpool city region with people seeking green space. But with lockdowns now behind us, John is seeing signs of a strong return of city centre living. He said the cladding issue was still holding back the sales market, with lenders reluctant to offer mortgages until it is sorted out.
“A lot of people say to me ‘you must be raking it in at the moment’,” he said. “Berkeley Shaw as a business has done really well over the last few years. But there is a misconception about how estate agents are doing at the moment.
“Don’t get me wrong, we have done quite nicely in recent times – stuff is selling at much higher prices. But it is also about the number of transactions and, at the moment, stock levels are quite low.
“It is a basic supply and demand issue. Everything that comes in it is a good fee for us but as agents we would like to see a higher volume of transactions. In terms of where the market will go, I don’t see a cliff edge.
“Despite rising interest rates, in an historical context, they are still really low. They will probably increase but I don’t see them going up hugely. The current growth of our sector is not sustainable but I see it plateauing out rather than falling off a cliff edge.
“Since the financial crash the stress tests and and financial eligibility checks done by the banks are much more stringent so buyers aren’t able to overstretch themselves as they once did.
“I think we will see more properties coming to the market but, unless there is a big rise in interest rates, then I don’t think we will see a big fall in the market.”