Acre Properties

A Message from Lord Pickles and Lord Blunkett, followed by Acre Properties's best practice article

The ability to listen and learn from one another has always been vital in parliament, in business and in most aspects of daily life. But at this particular moment in time, as national and global events continue to reiterate, it is uncommonly crucial that we forge new channels of communication and reinforce existing ones. The following article from Acre Properties is an attempt to do just that. We would welcome your thoughts on this or any other Parliamentary Review article.

Blunkett signature Rt Hon The Lord David Blunkett, MP
Pickles signature Rt Hon The Lord Eric Pickles, MP

www.acreproperties.com

1ACRE PROPERTIES |
BEST PRACTICE REPRESENTATIVE
Director Alastair Kerr
Iona Ledwidge, CEO of
Resurgo, working with Acre
on a SPEAR initiative
Alastair Kerr founded Acre Properties in 1988, but the
business really took off in the mid-1990s when buy-
to-let products started to appear. Originally, Alastair
and his team started by acquiring studio and one-bedroom
flats, but they then gradually moved towards larger flats –
both ex-council and private mansion blocks in west London.
By 2009, Acre Properties diversified into houses and property
rental companies. Alastair elaborates on their journey and tells
TheParliamentary Review
why his firm believes it’s important to
treat all tenants as if they are brothers and sisters.
From 2000 onwards – the financial crash
Between 2000 and 2008, we moved from taking on just private individuals to also
working with DSS and housing association tenants.
While this was a successful move, we soon saw lending criteria start to relax.
Around 2006, we became aware of something called “sub-prime lending”
occurring in the UK; we consequently declined facilities from Northern Rock, for
various reasons, and even advised them not to lend in excess of the value of a given
property as times were likely to change.
In April 2008, we wrote to two broadsheets concerning the base rate, stating that
it needed to drop quickly otherwise property prices would plummet. We could see
the cost of money and its yield on property was negative; in direct contrast to the
Bank of England’s stance at the time, we let our borrowing float above base rate,
FACTS ABOUT
ACRE PROPERTIES
»Director: Alastair Kerr
»Founded in 1988
»Based in Chiswick, west London
»Services: Property sales and
lettings
»No. of staff: 11
»Occupancy rate for DSS
tenants is 100 per cent
»Occupancy rate for professional
sharers is 98.65 per cent
»TrustPilot score of 9.9/10
Acre Properties
THE PARLIAMENTARY REVIEW
Highlighting best practice
2| ACRE PROPERTIES
rather than accepting fixed-rate loans.
Six months after the crash, the rate
dropped from five to 0.5 per cent.
What this stance did
As a result of the base rate drop,
the business transformed, and
consequently lenders began to seek
out our views on both the economy
itself and their general lending
structure.
Four lenders enhanced their terms and
conditions with our assistance. Two of
them worked on totally new products,
and one subsequently sold around
£250 million in new buy-to-let loans.
This was not the case for all lenders,
however; many suffered badly and
either went under or were prevented
from trading. Alongside these issues
and a new DSS rule which could have
resulted in us receiving rent as low as
just 50p a week, we had no alternative
but to restructure and cater for new
young professionals working in London.
After four years of this renewed focus,
we are now the UK’s largest provider
of single rooms in individual shared
residential properties. We roll all bills –
including cleaning, TV and wifi – into
monthly rent to make things easier for
busy young professionals.
Fighting homelessness
Our extensive, longstanding knowledge
of local authorities, DSS tenants and
funding has led us to observe a few
key areas in the property sector where
we believe things could be altered or
tweaked for the benefit of those who
truly need it.
Firstly, consider landlord taxation. To
look at the NHS for comparison, we
can arguably say that nobody would
suggest across the country that we
need fewer beds; many state regularly
that we need more. Considering our
population is rapidly expanding, and
that a sizeable chunk of that population
is, according to homelessness charity
Shelter, just one paycheck away from
sleeping rough, clearly we need more
individual, private landlords, not fewer.
Consider this alongside the fact that the
government’s 2015 budget introduced
measures to tax landlords progressively
– making it a less appealing prospect
for some – and revisiting taxation soon
feels like a prudent move.
We have also found that nearly 70 per
cent of our DSS tenants ended up in
arrears within the first few months of
benefits being paid to them directly.
Before and after,
14weeks on
We are now
the UK’s
largest
provider of
single rooms
in individual
shared
residential
properties
»RECRUITMENT
Many have commented on the unusual way we recruit people, which
results in long-term quality colleagues. The steps are:
1. A person known to an existing Acre employee is nominated.
2. They are invited in for an open and frank day’s experience.
3. A seven to 14-day break is taken.
4. If both parties wish to proceed then a second day is undertaken.
5. Ideally both parties proceed.
This method is tried and tested; 64 per cent of staff have 100 per cent
attendance records, and 55 per cent have been here more than ten years.
3ACRE PROPERTIES |
BEST PRACTICE REPRESENTATIVE
Our view at Acre is that no landlord
can ever have a tenant evicted for rent
arrears if they receive 100 per cent of
rent due – it’s a very simple principle.
We, and I personally, fail to understand
why providers do not receive rent
directly; it affects not only the tenants
in question but also the owner of
the property, whose mortgage or
income is adversely impacted as a
result. The system we use – and one
we recommend other providers adopt
– protects both parties and helps to
prevent avoidable homelessness.
First-time buyers, council
properties and youth mentoring:
helping the community
We also feel we are well positioned to
advise on issues which don’t just cover
avoidable homelessness.
Longer-term, ultra-low fixed-rate
products for 20 to 50 years could be
introduced to help first-time buyers.
These products, with their reduced
early repayment charges, would
progressively underpin people’s homes
and help the UK economy in general.
This would prevent lenders churning
fees every two to three years while
also giving new homeowners peace of
mind. Lending long-term reduces risk,
therefore meaning that lending against
higher income multiples becomes far
more feasible.
We have also seen issues with council
housing stock. Experience of council
properties, prior to purchase, is that
they are deficient in many basic safety
features. We conform to and exceed
the criteria and regulation that local
authorities use and are happy to, but
we feel this is something the council
themselves should also look at with
regards to their own stock.
Finally, the future of our workforce:
national apprenticeship schemes exist,
but as of yet, mentoring the young and
unemployed has not been promoted in
the same way. We have worked closely
with local charity SPEAR, an offshoot
of Resurgo, and the transformation we
have seen in two young individuals has
been a hugely uplifting experience.
Continuing apace
So far, we have not been impacted by
Brexit and remain confident in what
we do. We will continue to improve
our stock and are dedicated to extend
our vision for an eco-friendly future to
becoming a paperless office by 2021.
We want to keep helping our
community by mentoring an additional
two young and unemployed individuals
every year, and by making available a
specific number of rooms for London
key workers at subsidised rent rates.
Finally, we will continue to support
charity work across three continents
and, with The Africa Trust’s Ian
Thorpe, we will deliver 12 water
pumps to provide safe drinking water
to a minimum of ten new people for
every day in 2019, and at least 24
people every day in 2020.
Across all of these initiatives we can
see our central philosophy expanding:
while we enjoyed previous success by
treating our tenants as if they were our
brothers and sisters, I firmly believe it is
time we expand that familial approach
to cover everybody in our local,
national and international community.
We will continue
to improve our
stock and are
dedicated to
extend our vision
for an eco-
friendly future
The Africa Trust CEO,
Ian Thorpe, and an Acre
pump

www.acreproperties.com

This article was sponsored by Acre Properties. The Parliamentary Review is wholly funded by the representatives who write for it. The publication in which this article originally appeared contained the following foreword from Rt Hon Michael Gove.

Rt Hon Michael Gove's Foreword For The Parliamentary Review

By Rt Hon Michael Gove

This year's Parliamentary Review comes at a momentous time for parliament, as we collectively determine the destiny of the United Kingdom. 

On October 31, the UK will leave the European Union. The successful implementation of this process is this government's number-one priority.

Three years after a historic referendum vote, we will deliver on the decisive mandate from the British people. Trust in our democracy depends on it. Until that final hour, we will work determinedly and diligently to negotiate a deal, one that abolishes the backstop and upholds the warm and close relationship we share with our friends, allies and neighbours in the EU. But in the event that the EU refuses to meet us at the table, we must be prepared to leave without a deal.

As the Chancellor of the Duchy of Lancaster, it is my job to lead on this government's approach, should that scenario happen. Preparing for Brexit is my department's driving mission. But while I am leading this turbocharged effort, the whole of government is committed to this endeavour.

Ministers across Whitehall are working together to ensure that every possibility is considered, every plan is scrutinised and every provision is made. A daily drumbeat of meetings means that we are holding departments accountable, so that preparations are completed on time.

The chancellor has confirmed that all necessary funding will be made available. And we have mobilised thecivil service, assigning 15,000 of our most talented civil servants to manage our exit from the EU.

We will make sure that on November 1, there is as little disruption to national life as possible. Our trade relationships will continue to thrive, thanks to agreements with countries around the world worth £70 billion. Our country will remain secure, thanks to nearly 1,000 new officers posted at our borders. And the 3.2 million EU nationals now living and working among us can remain confident, with absolute certainty, of their right to remain in the UK.

Above all, our goal is to be transparent. Soon, we will launch a public information campaign so that citizens, communities and businesses are ready and reassured about what will happen in the event of “no deal”.

In my first few weeks in this role, I have travelled to ports and tarmacs, borders and bridges, all across the UK –from the seaside of Dover to the rolling green hills of County Armagh. I have heard from business owners and border officials, farmers and hauliers. They are ready to put an end to uncertainty. And they are ready to embrace the opportunities ahead.

Our departure from the EU will be a once in a lifetime chance to chart a new course for the United Kingdom. Preparing for that new course will be a herculean effort. But this country has made astounding efforts before. We can do it again.
Rt Hon Michael Gove
Chancellor of the Duchy of Lancaster