An idea born of trouble at the mill
Developers are dreaming up new ways of making property pay. Sharon Dale reports.
THERE’S nothing like a crisis for prompting the most creative ideas.
So when banks tightened their grip on mortgages and buyers dried up, hard-hit developers had to think of new ways of making property pay.
Newmason had just staged the wrap party for their highly successful Victoria Mills development in Shipley when the economic climate changed.
Five years in the making and with over 300 flats already sold to investors and owneroccupiers, there were 150 remaining when the market went into meltdown.
“We’d exchanged on most of these but then the lenders stopped lending or they changed the goal posts on what they would allow people to borrow, so buyers struggled to complete,” says Andrew Mason.
“We tried to take a humane view because we didn’t want to bankrupt people. We did deals like if they had agreed to buy two properties we allowed them to buy just one. We gave loyal investors five per cent discounts. We certainly didn’t go down the route some developers did of offering 30 per cent off.”
After helping struggling buyers over the finishing line, Newmason were left with 88 apartments.
Andrew and business partner Alec kept some for their own portfolios, while others were rented on conventional let. Another was turned into a boardroom to let for business meetings and they came up the idea of making 30 into short-stay serviced apartments.
“We’d already commissioned some research in 2006, which showed that people preferred staying in apartments rather than hotels, so the idea was always in the back of our minds and this situation brought it to the fore,” says Andrew.
They enlisted the help of friend Jo Brown, a hotel and hospitality specialist, and between them they came up with Vivo serviced apartments.
“We were lucky to have a very supportive bank that was receptive to the idea,” says Andrew.
We’ve now got regulars who say it’s like coming home and that’s just what it is.
from Taiwan and Japan to Mexico and Sweden,” says Jo.
“We offer everything from picking them up at the airport to food shopping for them.
“We’ve now got regulars who say it’s like coming home and that’s just what it is.
“They have all the home comforts unlike hotels, and there’s a real community here.”
They’ve proved so popular that Newmason is planning to roll Vivo out to other Northern towns and cities.
Although the initial outlay is high as the flats need a “wow factor” decor and furnishings, the yield is far better than on a conventional six-month let.
“We’ve been delighted with Vivo,” says Andrew, who is considering taking on another large mill development nearby.
“It has been a real success born out of adversity.
“I think we’ve been very fortunate all the way round really because had the crisis hit six months earlier I’m not sure we would’ve survived.
“As it is we’re looking forward to the future with confidence.”
Vivo: www.stayvivo.com. Tel: 08700 607044
The Victoria Mills development in Shipley. Top right, Andrew Newmason and Jo Brown, below, Vivo apartments offer “wow factor” decor and furnishings.