rural estates

Ever since my work for EMDA on rural estates and their contribution to the economy of the East Midlands I have been a fan (leaving noblese oblige and all that to one side) of the model of the estate as a rural business structure. This article demonstrates how their diversified base and their ability to take long sighted investment decisions has put them in good stead. Drawings its findings from a report by Savilles, it tells us:

From an investment perspective rural assets continue to outperform most alternative assets with a healthy investment performance recorded by our survey. In the year to 05April 2012 the average total return for all estates was 9.4%. However, like most property assets, the total return was primarily made up of capital growth at 7.9% and just 1.5% of income return.

At a regional level the survey shows that location is a key contributing factor to the opportunities presented to individual estates.

Agriculture is the main income stream in the eastern regions of England whereas income from non-agricultural assets squeezed the agricultural contribution in the southern regions to less than a quarter of gross income.

On average in the South East estates derive 47% of their income from residential property and a further 20% from commercial assets. While in the South West the proportion of gross income from leisure was higher than in any other region at 7%.

I think there is lots of scope for local authorities to get alongside estates on a complementary basis and I would be happy to chat to you in more detail about it if you drop me an email.

With the move of our good friend Rob Hindle to Rural Solutions a multi-faceted rural consultancy with a strong RICS component focused on estates I am sure we will have scope for some deeper insights into this agenda as time progresses. I might even be able to tempt him to pen something for us.