This year’s Mipim is set to be just as jam-packed as 2016, with about 23,000 participants from 90 countries
Theresa May has outlined a ‘hard Brexit’ but we are still not that much clearer on what that really means. It is going to take years of negotiation, re-ordering of institutions and mandate until we understand what the real consequences of separating ourselves from the EU are.
So, what impact does this have for Mipim and the swarms of leaders in property that make their way to Cannes every year? Well, this might just be Mipim’s most important year yet as what we are witnessing is not a blip – it is a shift in world order and the implications will cascade through all stratas, economies, institutions and businesses. More than ever before, we need to remain innovative, flexible and challenge historical norms to make it work no matter what.
The property sector has many issues to address and solve that will not disappear because of interest rates, exchange rates or any geopolitical issues. For example, health, education, housing, infrastructure all need appropriate strategies and solutions, along with the ongoing requirement to attract fresh talent into the industry to fill the skills shortage.
What we know
The perception and reality of risk is often very different but equally persuasive in influencing behavior, so it is important to deal with the facts and this is what we know so far:
Sure, employment costs will rise along with material costs due to inflation, but the falling value in the pound has made Britain a more attractive proposition
The Brexit vote hasn’t resulted in a mass exodus of financial institutions, on the contrary it has continued to attract significant investments with Arm pledging a £24bn boost to UK business, GlaxoSmithKline investing in three of its UK manufacturing sites, Apple taking space at Battersea Power Station Development, Hinkley Point go the go ahead and Nissan, Google and IBM all on the record as saying they are investing further in the UK.
GDP growth figures show an increase with the economy growing by 0.7% in the last quarter of 2016. Employment is also up with ONS figures also showing an increase of 74.6% up form 74.1% in the last quester of 2015.
Sure, employment costs will rise along with material costs due to inflation, but the falling value in the pound has made Britain a more attractive proposition, with the Dollar going 15% further than eight months ago.
What we don’t know - yet
Brexit or no Brexit there is still plenty to do and consider; how we design, procure, build, and capture innovation in the built environment – right now one of the biggest risks is inertia so we really need to take advantage of the many influencers all gathered together and address key issues for now and the future.
I expect hot topics will include the expanding “gig” economy that could have real implications in how we procure skills, and the surge in successful organisations like Airbnb who have a huge impact on the residential and hotel sector but don’t actually own any fixed property assets. In the office sector , WeWork, Instant Office and The Office Group are also challenging the traditional view the market, where occupiers are demanding more flexible space and shorter-term leases.
Other subjects at the top of the agenda will include solving the housing crisis, London charging towards mega-city status by 2030 and what needs to happen to guarantee the infrastructure is in place to support its burgeoning population and the continued investment required in regional hubs as their importance is recognised for the parity of prosperity.
We need to work out a way to continue to collaborate with our European counterparts so we can share knowledge and crucially workers that are supporting commerce, as well as attracting homegrown talent by making the construction sector more attractive to the brightest and best graduates.
Mipim is a forum for creating opportunities and ensuring positive outcomes from the challenges that we need to overcome. The UK is in a unique position of being able to shape its own destiny to ensure that we remain the most attractive country to invest in.
It starts here.
Rennie Dalrymple, Managing Partner at Bruceshaw