News

The commercial property market may be approaching its nadir as more workers return to the office, according to Land Securities, one of the UK’s largest landlords.

Mark Allan, CEO of Land Securities, which owns a portfolio worth billions, stated that the values of high-quality properties have “largely bottomed out and will start to grow in the foreseeable future as rents rise.” He noted that the reset of values over the past two years, driven by rising interest rates, has stabilised, with evidence of continued rental growth attracting increased investor interest in the best assets.

Allan’s comments came as the company reported an 18 per cent increase in the number of workers entering its office buildings. The return to office work, combined with employers planning to provide more space per employee, is driving “particularly strong demand for best-located, highly sustainable, and well-amenitised office space.”

Devaluations of Landsec’s office properties in London accounted for £449 million of its total £625 million portfolio writedown last year, bringing its portfolio’s value to £9.96 billion. Central London offices and office developments make up about 60 per cent of Landsec’s portfolio, with another 20 per cent comprising shopping centres and retail outlets.

These devaluations contributed to a pre-tax loss of £341 million for the 12 months ending in March, a narrower loss compared to the £622 million loss from the previous year, thanks to rising rents and stable values in the second half. The company’s net asset value per share fell from 936p to 859p, but it still increased its total dividend by 2.6 per cent to 39.6p per share.

Landsec, which owns notable properties such as the Bluewater shopping centre in Kent and the Dominion Theatre in London’s West End, is progressing towards its goal of selling £4 billion of “non-core” property. Recently, it sold its remaining hotel portfolio to Los Angeles-based Ares Management for £400 million, and it plans to sell approximately £400 million of retail parks and a small number of standalone London assets not located in its core areas. In the longer term, Landsec aims to dispose of its “sub-scale” out-of-town leisure parks.

Proceeds from these disposals have provided Landsec with about £1 billion to invest in its committed development pipeline and other properties over the next 12 months. The company’s other top priority is investing in prime retail, driven by confidence in the performance of its existing retail locations, where it sees “really attractive” returns.

Read more:
Commercial Property Values Poised for Growth as Office Return Accelerates

Challenging economic conditions have led to an 18 per cent surge in company insolvencies during April, as rising debt levels, higher interest rates, and spending cuts took their toll.

According to data from Companies House, company insolvencies rose to 2,177 in April, up from 1,838 in March. Over the 12 months leading to the end of April, the insolvency rate increased to 57 per 10,000 companies, compared to 52.6 per 10,000 in the previous year.

The current level of insolvencies remains significantly higher than during the pandemic and the 2014-2019 period. However, it is still below the peak of 113.1 insolvencies per 10,000 companies seen during the 2008-2009 recession.

The construction sector was particularly affected, with 4,273 insolvencies reported in the 12 months to the end of March. This sector accounted for approximately 17 per cent of all insolvencies, as companies grappled with inflation and rising labour costs.

Kelly Boorman, national head of construction at RSM UK, noted that many construction businesses are “still recovering from legacy contracts, procured as fixed-cost contracts pre-Covid and subject to litigation.”

Compulsory liquidations in April rose to 300, the highest since January 2019, reflecting the ongoing struggle with increasing debt levels.

Amid this surge in insolvencies, FRP Advisory, the restructuring group, has reported a beneficial outcome. The London-based firm expects its annual profits to rise to £37 million, with projected revenue of £128 million for the year ending April, marking a 23 per cent increase from the previous year.

FRP Advisory has been involved in high-profile restructuring cases, including The Body Shop, Inland Homes, and the parent company of Reader’s Digest. The firm has expanded its market share to 16 per cent from 14 per cent in 2023, handling 76 transactions with a total deal value of £1.4 billion over the year, down from £1.8 billion the previous year.

As the economic landscape continues to present challenges, the rise in company insolvencies underscores the pressing need for businesses to adapt and seek expert advice to navigate these turbulent times.

Read more:
Company Insolvencies Surge by Nearly 20% in April

The forthcoming election presents a significant opportunity to rethink the role of business in society, according to Chris Turner, campaign director of the Better Business Act.

Speaking to a Barbican audience during a panel event celebrating the third Better Business Day, Turner emphasised the potential for the Better Business Act to fundamentally change how firms engage with their stakeholders.

The Better Business Act seeks to amend Section 172 of the Companies Act, which currently outlines the responsibilities of company directors. The proposed changes aim to empower directors to make decisions that consider the interests of people, the planet, and profit, rather than focusing solely on profit.

Holly Branson, Virgin’s chief purpose officer and a long-time supporter of the Better Business Act, spoke about the positive impact of embedding purpose within her multi-billion pound business. She highlighted the implementation of a “purpose filter” at Virgin, ensuring that only decisions aligned with their purpose proceed.

Branson was joined on the panel by ethical consumer and fashion campaigner Safia Minney, and Josephine Phillips, founder and CEO of Sojo — a company providing easy repair solutions for pre-owned items. Phillips noted that changes to the Companies Act would contribute to a cultural shift in businesses, reflecting the global challenges faced today.

New research by B Lab UK, the organisation behind the B Corp movement and the Better Business Act, shows strong public support for the proposed changes. According to the data, 76% of the UK public believe that company law should be amended to give businesses a legal responsibility to prioritize people and the planet alongside making a profit.

The Better Business Act also enjoys robust support from the business community, with nearly 3,000 organisations backing the initiative, including Tony’s Chocolonely, Iceland, the Institute of Directors, and Lucky Saint.

Read more:
The General Election is a perfect ‘Window of Opportunity’ for Better Business Act Campaigners

After losing twice in the protracted ‘mega marshmallows’ tax case, HM Revenue and Customs (HMRC) has announced its intention to file yet another appeal.

Last month, the Upper Tax Tribunal upheld a lower tribunal’s ruling that ‘mega marshmallows’ sold by London-based wholesaler Innovative Bites are not considered confectionery and therefore are exempt from VAT.

The case revolves around the classification of ‘mega marshmallows’ for VAT purposes. The Upper Tax Tribunal agreed with the lower tribunal’s findings that the product was marketed and sold specifically for roasting, and its large size differentiated it from standard rated smaller marshmallows.

Despite these rulings, HMRC maintains that ‘mega marshmallows’ should be classified as confectionery and subject to standard VAT. On Thursday, HMRC updated its VAT appeals, stating it is seeking permission to appeal the decision, continuing its argument against the current classification.

Glyn Edwards, VAT Director at accountancy firm MHA, expressed surprise at HMRC’s persistence: “We all thought this was the end of the giant marshmallows tax debate, but HMRC have decided to appeal again in the hope of finally persuading the tax authorities that size isn’t everything.”

Edwards also raised concerns about the public perception of this prolonged legal battle: “The general public might question whether this is really the best use of taxpayer’s money when we all know that making any sense of the VAT dividing lines on food has defeated the best legal minds for decades.”

Jilly McCullagh, director at the VAT consultancy working with Innovative Bites, echoed this sentiment, calling HMRC’s decision “disappointing.” She questioned the practicality and financial sense of continuing the appeal: “Is it really in the best interest of taxpayer’s money? Where and when does this stop?”

An HMRC spokesperson confirmed the department’s intentions: “We are seeking permission to appeal the (Upper Tribunal) decision to the Court of Appeal.”

As HMRC seeks another round in the ‘mega marshmallows’ tax case, the debate continues over the classification of the product and the use of public funds in prolonged legal disputes. With the Court of Appeal as the next potential battleground, the final resolution of this VAT issue remains uncertain.

Read more:
HMRC Seeks Another Bite in ‘Mega Marshmallow’ Tax Case

Hey there, future investor! You’re prepared to dive into the exciting realm of investing, but where do you even start? It’s natural to feel overpowered with numerous choices, isn’t that right?

You’re not on your own, so don’t fret over! Many others are attempting to figure out what to do with their money and are in a similar situation.

Imagine this: You want to watch the money you’ve saved grow. But as soon as you begin exploring your options, terms like stocks, bonds, mutual funds, real estate, and cryptocurrencies will be thrown at you. It’s like trying to decipher a secret code!  But fear not, my friend, because this piece has got a little secret to share with you. Ever heard of copy trading? No? Want to learn what is copy trading meaning? Well, buckle up because this piece is about to take a deep dive into this game-changing investment strategy that’s perfect for beginners like yourself.

The Perplexing World of Investments

Let’s talk about the aspiration for monetary success. Who wouldn’t enjoy seeing their hard-earned cash grow? Nonetheless, the idea of investing may be frightening to a lot of people. Like trying to navigate a maze while wearing a blindfold!

Most likely, you’ve heard of traditional investment products like bonds, stocks, and real estate. Even though these can be excellent wealth-building techniques, they frequently come with a high degree of risk and a difficult learning curve. Let’s not overlook the challenges. Ignorance? Check.  Fear of being lost? Check once again.  Not even the hardest-core of people won’t want to hide their cash under the mattress! Nevertheless, there is hope; the end is in sight. Come into the copy trade, shining armoured hero! This unconventional investment approach provides a straightforward process that is ideal for novice investors.

Introducing Copy Trading

Now, let’s get down to the nitty-gritty: To learn what is copy trading meaning, and how can it help you grow your wealth? Let’s dive into the specifics now. Find out how copy trading could contribute to your wealth accumulation. Think of this as a “set it and forget it” approach to investing. You can trade like a pro with copy trading without actually moving anything.

Doesn’t that sound amazing? Well, things are getting better! Copy trading simplifies the process and lets you benefit from seasoned traders’ knowledge without having to put in a lot of work, in contrast to traditional trading methods that require hours of research and analysis. But hold on, there’s more! In addition, copy trading offers several advantages such as a quicker learning curve, time savings, and expert-level portfolio diversification. It’s also an excellent way to learn trading without having to risk any of your own money.

What is the process of copy trading?

Hooked your interest now, let’s talk about mechanics. Copy trading platforms serve as middlemen, bringing together global expert traders and investors. After locating a trader whose strategy aligns with your financial objectives, you can relax and watch the magic happen. But make sure you are aware of the risks before you take a chance. Even though copy trading is simple, you still need to choose your traders wisely and do extensive due diligence to make sure they are reliable.

Don’t forget to do a thorough study! Even though copy trading may make investing easier, it’s still important to comprehend the strategies used by the traders you decide to follow. Information is after all very powerful!

Start your copy trading journey now

Are you prepared to make the move? This is the way to get going. You must first register with a trustworthy copy trade platform. After that, you’ll fund your account and begin searching for traders to model yourself after. Don’t stop there, though! Maintaining the direction of your investment requires closely observing the performance of the traders you have selected. Recall that investing is a process rather than a final goal. Don’t be afraid to keep learning and looking for new opportunities as your self-assurance and knowledge grow.

Conclusion:

That’s it for now, everyone! Investing doesn’t have to be a scary endeavour. You and other novice investors can safely dabble in the world of investing with copy trading and crypto trading.

Therefore, keep in mind that taking action is the first step towards financial empowerment, regardless of your level of experience with investing. You’ll quickly reach your financial objectives if you have copy trading on your side. Happy investing

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Searching Profitable Avenues

Shares in Reddit have surged more than 10% following the announcement of a partnership deal with artificial intelligence (AI) start-up OpenAI.

This agreement grants OpenAI access to Reddit’s content while introducing AI-powered features to the social media platform.

The partnership underscores Reddit’s strategic move to diversify its income streams beyond traditional advertising. By leveraging AI, Reddit aims to enhance user experience and introduce innovative features powered by OpenAI’s technology.

The deal comes amidst a growing wave of legal challenges from copyright owners concerning the use of their material by AI firms. On Thursday, Sony, the world’s largest music publisher, sent letters to Google, Microsoft, and OpenAI, demanding clarification on whether its songs had been used to develop AI systems.

In recent months, OpenAI has secured agreements with several publishers, including the Associated Press and the Financial Times. Similarly, Google announced in February a partnership allowing it to access Reddit data to train its AI models.

In both the European Union and the United States, questions persist about whether using copyrighted content to train AI tools constitutes copyright infringement or falls under fair use and “temporary copying” exceptions. This issue is currently being tested in multiple US court cases, representing high-profile figures like “Game of Thrones” author George RR Martin, comedian Sarah Silverman, and the New York Times.

Advancements in AI Technology

This week, OpenAI unveiled GPT-4, the latest version of the technology behind ChatGPT. GPT-4 offers faster processing, more conversational responses, and advanced features such as image reading, language translation, and emotion identification from visual expressions. Notably, it includes memory capabilities to recall previous prompts, enhancing user interactions.

The announcement has positively impacted Reddit’s stock, reflecting investor optimism about the potential benefits of integrating advanced AI technology into the platform. As AI continues to evolve and reshape various industries, partnerships like this highlight the importance of innovative solutions in staying competitive.

The Reddit-OpenAI partnership represents a significant step in the growing collaboration between social media platforms and AI developers. As Reddit continues to explore new avenues for growth and user engagement, the integration of AI-powered features promises to enhance the platform’s functionality and appeal.

Read more:
Reddit Shares Surge Following OpenAI ChatGPT Partnership

Chancellor Jeremy Hunt has pledged further tax cuts for the autumn, asserting that the UK economy has “turned a corner.”

In a bid to draw clear distinctions ahead of the next election, Hunt accused Labour of planning to raise taxes while positioning the Conservatives as committed tax-cutters.

In a speech on Friday, Hunt acknowledged the significant financial challenges faced by families due to the global pandemic and the energy crisis exacerbated by the war in Ukraine. He argued that the Conservative government had protected people’s finances during these turbulent times. Hunt highlighted that inflation had dropped to 3% and claimed the country was emerging from a shallow recession.

Hunt suggested that a cut to national insurance could be expected in the autumn and promised that the Conservatives would focus on reducing the overall tax burden in the next parliament. He emphasised, “The economy is doing well, and further tax cuts are on the way as we continue to recover.”

Criticism of Labour’s Financial Plans

The Conservative Party released a dossier alleging that Labour had a £38bn gap in its financial costings, which they argued would necessitate tax increases. Hunt criticized Labour leader Keir Starmer for making vague promises, describing them as “motherhood and apple pie” without concrete plans.

In response, a Labour spokesperson accused the Conservatives of attempting to deflect attention from their own £46bn unfunded tax plan. They argued that this plan could lead to higher borrowing, increased taxes on pensioners, or potentially threaten the state pension system. The spokesperson stated, “All of Labour’s policies are fully costed and fully funded. Unlike the Conservatives who crashed the economy, Labour will never play fast and loose with the public finances.”

Election Battle Lines

Hunt’s remarks are part of a broader effort by the Conservatives to set the agenda for the upcoming election. He accused Labour of spreading “fake news” regarding the state pension, aiming to reassure older voters about their financial security under a Conservative government.

This speech follows significant press conferences by other key political figures, including the shadow chancellor Rachel Reeves, Prime Minister Rishi Sunak, and Labour leader Keir Starmer, indicating that both parties are gearing up for the election campaign.

As the political landscape heats up, Hunt’s promise of further tax cuts and his criticisms of Labour’s financial plans are designed to bolster the Conservative’s position as the party of economic prudence and tax reduction. The upcoming autumn budget and the details of these promised tax cuts will likely play a crucial role in shaping voter sentiment as the election approaches.

Read more:
Jeremy Hunt Promises Further Tax Cuts and Criticises Labour’s Plans

The number of UK bank branches that have permanently closed their doors over the past nine years will surpass 6,000 on Friday, a milestone that highlights the significant impact on local communities.

The consumer group Which? has published these figures as part of its effort to bring attention to the widespread closures and their detrimental effects, urging this issue to become a focal point in the upcoming general election.

Eight Barclays branches are set to close on Friday, bringing the total number of closures since 2015 to 6,005. Barclays alone is responsible for approximately 20% (1,216) of these closures, leading the tally among major banks.

Surge in Closures

The rate of closures peaked in 2017 but seemed to slow down until a recent surge. Which? accuses banks of engaging in a “race to close branches” following the government’s 2020 announcement of potential laws to protect access to cash, which could complicate branch closures if alternative provisions are lacking.

Banks justify these closures by pointing to a significant shift in customer behavior, with more people favoring online and mobile banking over traditional counter services. However, the trend has left many without convenient access to in-person banking services.

Future Banking Blackspots

By the end of the year, 33 parliamentary constituencies, including Erith and Thamesmead, Dagenham and Rainham in London, and Sedgefield, the former seat of Tony Blair, are expected to be without a single bank branch.

Impact on Communities

While millions have transitioned to digital banking, a considerable number of people, particularly those less tech-savvy, still rely on physical branches. The closures have forced some customers to travel long distances for essential services, such as registering power of attorney, which many banks require to be done in person.

Sam Richardson, Deputy Editor of Which? Money, noted that while some might not notice the closure of their local branch, “for others reliant on face-to-face services, the impact can be disastrous.”

Call to Action

With a general election on the horizon, Which? is advocating for the next government to commit to establishing at least 200 banking hubs within the first two years post-election. These hubs, managed by Post Office staff, offer services such as cash withdrawals, deposits, bill payments, and other regular transactions, essentially functioning as standard bank branches.

Response from Banks

Barclays, named as the bank with the most closures, stated: “As visits to branches continue to fall, we need to adapt to provide the best service for all our customers. Where levels of demand don’t support a branch, we maintain an in-person presence through our Barclays Local network, live in over 350 locations, based in libraries, town halls, mobile vans, and our banking pods.”

Constituencies Expected to Have No Bank Branches by Year-End

Barnsley East (Population: 94,000)
Bolton West (98,000)
Bradford South (106,000)
Bury South (103,000)
Central Suffolk and North Ipswich (102,000)
Chatham and Aylesford (103,000)
Clwyd South (70,000)
Colne Valley (112,000)
Dagenham and Rainham (117,000)
Denton and Reddish (88,000)
Don Valley (99,000)
East Worthing and Shoreham (99,000)
Erith and Thamesmead (117,000)
Glasgow North East (88,000)
Liverpool, West Derby (94,000)
Mid Bedfordshire (121,000)
Mid Derbyshire (83,000)
Newport East (84,000)
North East Derbyshire (92,000)
Nottingham East (98,000)
Penistone and Stocksbridge (89,000)
Plymouth Moor View (94,000)
Reading West (112,000)
Rhondda (68,000)
Sedgefield (85,000)
Sheffield Hallam (85,000)
St Helens North (100,000)
Stone (86,000)
Swansea East (81,000)
Warrington North (95,000)
Wentworth and Dearne (100,000)
Wirral West (68,000)
York Outer (92,000)

The ongoing wave of branch closures underscores the urgent need for solutions to ensure accessible banking services for all communities, particularly those who rely heavily on face-to-face interactions.

Read more:
More Than 6,000 UK Bank Branches Closed in Nine Years Amidst ‘Disastrous’ Impact

Inflation has significantly reshaped the UK economy, steering households towards the highest savings rate in three decades and reducing spending by £50 billion, according to the Resolution Foundation.

In a recent report, the economic think tank highlighted that household consumption had contracted more than the fall in real incomes during the cost of living crisis, with excess cash being deposited into savings accounts. Compared to the final three months of 2019, the last quarter before the Covid-19 pandemic, real household disposable incomes have decreased by 1.1%, or £280 per year. However, real spending has declined by 4.7%, or £1,200 annually.

The nearly £1,000 difference between reduced incomes and spending has been directed into savings, with families saving 6% of their incomes in the final quarter of last year. This represents the highest savings rate outside the pandemic in 30 years. The foundation noted, “Had they instead saved at 2019 levels, this would have boosted aggregate spending by £54 billion a year.”

James Smith, Research Director at the Resolution Foundation, commented on the findings: “The sheer scale of this near-three-year inflation shock has reshaped the economy and public finances and changed what people do with their money. The crisis has made us poorer, with the sharp rise in the cost of essentials hitting lower-income families hardest. It also has turned us from a nation of spenders to a nation of savers, with credit card spending falling by 13% and families saving around £54 billion a year more than we might have expected.”

Inflation peaked at a 42-year high of 11.1% in October 2022 but has since fallen to 3.2%. Concurrently, the Bank of England raised interest rates to 5.25%, the highest in 16 years, making saving more attractive than spending.

The report also pointed out that increased government spending to offset the cost of living crisis and the prevalence of inflation-linked government debt pushed the UK’s debt-to-GDP ratio up by six percentage points during the price surge. Historically, periods of intense inflation have typically seen the nation’s relative debt stock fall.

The Resolution Foundation’s findings suggest that while inflation has imposed financial strains, it has also prompted a significant shift in household financial behavior, leading to increased savings and reduced consumption across the UK.

Read more:
Inflation ‘Turns UK into Nation of Savers,’ Reports Resolution Foundation

German businesses plan to increase investment in people and production in the UK, but more needs to be done to improve post-Brexit trading, say leading business and tax advisory firm, Blick Rothenberg.

Nils Schmidt-Soltau, a Partner at the firm, said: “A recent survey by the German-British Chamber of Commerce found that most UK-based German businesses view the performance of their UK operations positively or very positively with nearly half of the respondent’s expecting growth over the next 12 months.”

He added: “More than 40% of respondents plan to increase their investment in the UK, in a clear sign that business sentiment and the outlook for the UK market amongst German businesses are improving. Respondents noted that the primary reason for German companies to grow their presence in the UK is the size and attractiveness of the local market, but political uncertainty, subdued demand, and trade barriers are listed amongst the challenges that businesses are facing.”

Nils said: “Whilst we are pleased to see resurgent optimism amongst German businesses in the UK, there is clearly more the UK government will have to do to create an environment where international businesses will be confident to invest.”

He added: “More needs to be done to improve the post-Brexit trading arrangements to remove some of the barriers now in place on the movement of people and goods. Business needs clarity and simplicity and avoiding further regulatory friction between the UK and its closest trading partners will be key to enable the UK to achieve its growth agenda.”

Nils said: “Any incoming government needs to be more mindful that the United Kingdom, as a business destination for German and other international businesses, is in competition with other European markets. There needs to be a clear realisation that any further regulatory and legal divergence from EU standards will further reduce the attractiveness of the United Kingdom as a destination for EU businesses.”

He added: “While German businesses in the UK wish to expand their operations, there has been a marked reduction in small to medium sized German businesses establishing operations in the UK in recent years as the cost, both in financial terms and management time, coupled with the perceived regulatory and political uncertainty are considered too significant.”

Nils said: “Whilst for many overseas businesses the UK market remains attractive, more needs to be done to remove barriers to entry and to demonstrate that the UK is open for business with a reinvigorated focus on developing relations with its immediate neighbours.”

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German companies are to increase their investment in the UK