Politics and the weather threatened to upstage the real estate conversation at this year’s UKREiiF conference. As the Prime Minister called a snap general election on Wednesday, delegates, in stark contrast with Rishi Sunak, took refuge from torrential rain in the pavilions surrounding the Royal Armouries Museum in Leeds.

In the end it merely added an extra layer of urgency to the many discussions around leasing deals, property sales and the challenges confronting the industry that were had at Leeds Dock, which hosted almost 13,000 delegates.

CoStar News reviews the key talking points and participants at an increasingly essential annual conference that was most focused on the challenges that are holding back investment and development, as well as the impact of the upcoming July general election and market trends across the regions.

The 2024 edition of the UK Real Estate Investment and Infrastructure Forum was already primed for a heavy political focus.

A day before the Prime Minister called a surprise 4 July general election, JLL chief executive office, markets advisory, UK and EMEA, Stephanie Hyde had called for stability from the UK’s leaders in a session which discussed the ambition and appetite for UK investment over the next five years.

Hyde stressed that existing and potential property investors needed to see stability within UK politics to create the confidence they needed to push the button on significant regional projects, such as large regeneration schemes.

She said: “I was talking to someone yesterday who said 'stability is the new sexy'. I wouldn’t quite use those words, but I get what they mean in that it is important that we have that clarity for businesses to know about investing.

“When capital was cheap, it was hard enough, but with interest rates where they are, that is increasingly important and something which people are looking for. So, we need to make sure that is something that is there.”

You are never too far away from plans being marketed for the redevelopment of large regional sites at UKREiiF, with the conference an increasingly important opportunity for the regions to pitch their investment opportunities and landlords to market properties.

On Thursday, a masterplan for a redevelopment of the Broad Marsh area of Nottingham including its former Intu shopping centre, The Broadmarsh Centre, was unveiled by the city council.

The plan will be used to help the local authority continue its dialogue with Homes England and the new East Midlands Combined County Authority area to de-risk and prepare the area ready to take to the market.

Hyde added that the UK remained attractive to international investors due to its transparency, the strength of the dollar compared with the pound and quicker repricing compared to continental peers. She also mentioned the strength of the country’s developing knowledge industries, such as life sciences and data centres.

But she admitted the UK faced challenges which needed addressing to ensure it moved in the right direction during the next half-a-decade. Ensuring sufficient energy and expanding grid capacity was one of the challenges highlighted by the JLL chief, who also appealed for a national infrastructure plan.

Hyde also said that multiple schemes in Cambridge had been held back by the Environment Agency due to concerns around a lack of water supply, but she highlighted planning as one of the main barriers to development in the UK.

She added: “We can’t forget the fact that we’ve got, on average, five year-plans that local authorities are taking seven years to do, that was according to the chief planner at a recent conference, and there’s been a 36% drop in funding, which makes it really difficult to get those resources.”

One sector focused on planning is industrial. On Wednesday, the British Property Federation published a logistics manifesto in which it asked Number 10 to treat logistics accommodation as “critical national infrastructure”.

The proposals are backed by some of the biggest names in the sector, including Segro, Amazon, DHL, Prologis, and Savills, all of whom form part of the BPF’s Industrial Committee and Logistics Property Board.

One of the recommendations made by the BPF in its "Building the UK’s Critical Infrastructure" logistics manifesto is for the government to adopt a strategic planning approach. This would see decisions are taken at the “appropriate national or regional level, rather than by local authorities alone”.

Paul Weston, regional head of Prologis UK, stressed the role played by the logistics sector in the UK economy, referring to job creation and placemaking in an interview with CoStar News at the firm's pavilion. “You are creating spaces that people and the community can use,” he said.

“Around 7% of the UK population work in logistics and 91% of the people we surveyed who work in our buildings are on full-time contracts. The jobs in logistics are above the median average for salaries in the UK."

He added: "There are a lot of misconceptions around the sector, and we are really working hard now with other big owners through the BPF, and also off our own bat, talking to government and with shadow government, around what opportunity they should be taking as far as this sector is concerned because it can create jobs and growth, and it can be right at the forefront of sustainability."

In a separate conversation, Savills’ head of EMEA industrial and logistics research, Kevin Mofid, echoed comments made by JLL’s Hyde by saying that concerns around power at UK industrial sites had replaced planning as the number one issue for everyone involved with developments.

He said it was becoming “another bottleneck” for the logistics sector, with the majority of substations lacking the capacity to support a warehouse of 750,000 square feet or over.

Mofid said industrial take-up in the first half of 2024 was buoyed by the return of big-box deals, with Amazon committing to building a circa 2 million-square-foot fulfillment centre in Northampton and GLP signing Nike to 1.3 million square feet at Magna Park Corby.

Mofid said: “It’s a two-pronged market at the minute. The occupational market is doing better than I thought it would at the start of the year and what’s interesting is that we are starting to see bigger deals happen and built-to-suit deals happen.

“Amazon are obviously a bellwether for the market, so the fact that they are back viewing buildings and signing deals is a really good sign, particularly for the continued growth of ecommerce and the impact that has on the market.

“Capital markets have started slowly this year. I think that is not because there are no buyers, there are also very few sellers at the minute and there’s very little distress, so why would you sell at this point in the cycle when you think that values are going to go up.”

With attendees greatly up on last year, the atrium of the Royal Armouries Museum was bustling, with public and private sector professionals mixing with developers and contractors for the three-day event. But perhaps the biggest crowd was drawn by Angela Rayner, the shadow deputy mrime Minister.

The MP for Ashton-under-Lyne, Greater Manchester, generated a crowd that stretched the length of the narrow conference centre as she delivered a keynote speech in the Bury Theatre on housing and planning.

In her address, Rayner said that Labour would “get Britain building again”, if elected, adding that the current planning system was “gummed up”. She said that fewer developments were approved in the last quarter of 2023 than during the height of the pandemic.

“I am sure you all know better than most that getting applications over the line can be like swimming through treacle and it’s absolutely right that local people get a say, but a failing system is not in the local or national interest.”

Other glimpses of what a Labour government would promise included a scheme to build the next generation of “new towns”, generating more social and affordable homes. She also said that Labour would “end the medieval leasehold system” with a “root and branch reform” and reintroduce local housing targets axed by the government in December 2022.

A day later, outside 10 Downing Street in London the Prime Minister vowed the government had “tackled inflation” and “controlled debt” as he announced the UK would hold a general election on 4 July, Independence Day in the US.

Sunak added that the country’s new-found freedoms through its exit from the EU in January 2020 had made the UK the “best country in the world to grow a business”, but dedicated a large part of his speech to highlighting the security threats posed by various states.

The reaction from the property section to the calling of the general election has been cautious, although some property experts told CoStar News that the country learning its fate sooner that expected is a good outcome.

Holding the fort back in London, CoStar News’ COVID-struck managing editor for Europe, Paul Norman, gathered the views of a number of real estate commentators in this piece. Mat Oakley, head of commercial property research at Savills, told him that “political change seldom impacts the commercial property market”.

"The UK is one of 40 countries that are likely to have an election in 2024, and the question always comes round as to whether this heightens investor uncertainty.

“Our analyses suggest that transactional activity is generally lower than normal in the three months prior to the election date, and then recovered in the following six-month period.

"There is little evidence that a UK general election has ever had a measurable impact on commercial property pricing.”

Among all the talk about politics, there was still opportunity to discuss the regional markets. Heading into the conference, the host city had the strongest office take-up figures during the first quarter at circa 250,000 square feet.

Jeff Pearey, head of UK regional office agency at JLL, told CoStar News that although Leeds had not seen large deals, it had enjoyed a number of “strong ones” which helped to sustain leasing momentum from last year.

He said that the good news for Leeds and the regional office market was that “occupiers want space”, and increasingly better offices to drive a return to the office post COVID. But Pearey said that the challenge was in the levels of stock.

He listed Bristol, Edinburgh and Leeds as having tight supply, saying that regional agents had been discussing the importance of prelets to show investors the demand for offices in the hope of driving additional development.

Pearey tipped Manchester to have a “thumping year”, with good-quality schemes such as NOMA and the new Eden development in Salford likely to attract further attention. In places where there is a limited pipeline of schemes coming through, he said talk was turning to rents.

“The big discussion is when is £50 going to be the headline rent. No one is at that at the moment, but it is being talked about in Edinburgh and Bristol. Those two markets aren’t especially huge, but they are already at the circa £45 level with refurbishments happening. They could be the first markets to reach that £50 climb.”

There were also a number of large regional office trophies placed on the market in the weeks running up to UKREiiF. One of the biggest players regionally is M&G, which is looking to sell some £260 million of office across the UK, including Leeds' Central Square offices for circa £78 million.

Despite good-quality stock being put on the block, Pearey said the office investment market was challenged by a lack of buyers. “You do need that sentiment shift to happen and I think that could still be another six to 12 months, where we need yields to start looking a bit more attractive for people.”