About us
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FEATURED PROPERTY
One Curzon Street
London W1
Business model
Following are the key elements of our business model which, for the past 15 years, has enabled us to emerge through severe market conditions in a better position than many of our competitors.
01 Low-risk financing & funding
Development Securities PLC maintains a conservative use of debt. It seldom owns the major projects it actively develops, although it may have a modest financial involvement in some schemes. The Company typically derives project management fees through the development process and a participation in the potential gain arising to our development partner when the project is completed.
We never accept sole development risk in relation to our complex and substantial projects, sharing the majority of the project risk with major financial institutions and partners who are the more appropriate long-term investors.
Our funding partners have included:
Standard Life Investments
The Prudential Assurance Company
Legal & General Assurance Society
Universities Superannuation Scheme Limited
Aviva Investors
DEKA Immobilien Investment GmbH
Commerz Grundbesitz Investmentgesellschaft
Deutsche Grundbesitz Investmentgesellschaft
Corpus Sireo Immobilienfonds
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02 Value creation through development activity
Our strong track record, which includes the successful multi-phase developments at PaddingtonCentral, gives us a competitive advantage when seeking large-scale projects in central London. In the current market, however, it seems to us that the weight of money seeking prime central London property has driven land values to a level where we are rarely able to justify the rental tone and exit yields that would be required for an economic, risk adjusted return.
In the current marketplace, where bank debt is constrained and equity capital is not yet comfortable in being deployed meaningfully outside central London, we apply our expertise and cash in selected properties and projects with strong fundamental characteristics that have been constrained by lack of capital and expertise. Our aim in these instances is to identify opportunities to transform secondary assets, whether through change of use, refurbishment or redevelopment, into higher quality real estate that will appeal to the ultimate cash investor.
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03 Focus with balance & diversity
To provide a sustainable business model through unpredictable property and business cycles, we aim to combine opportunities for both short-term and multi-phase development projects, with the stability of, our investment portfolio. To ensure focus of expertise we restrict our activities to the UK, remaining largely within the commercial property market, and working with carefully selected partners in sectors where additional expertise is required.
Our balanced, diversified business model typically includes:
Regional urban regeneration projects
Food-anchored retail development projects
Mixed-use developments
Prime residential
Single, prestige office developments
Multi-phase office developments
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04 Investment portfolio
We allocate a significant element of our equity to the ownership of a diverse investment portfolio as we know that large development projects lasting through several property cycles can create uneven profits and cash flow.
Our investment portfolio consists of properties spread across the UK, covering retail, office and industrial sectors. This mix is driven by market conditions, availability and stock selection, focusing always on the potential for asset improvement. It provides a steady and predictable flow of rental income, contributing significantly towards central overheads and finance costs.
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05 Geographic focus
All of our development and investment activity is conducted within the United Kingdom.
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