VICTORIAFOCUSREAPPRAISING THE NEIGHBOURHOOD

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Kings Gate Development

Following significant regeneration over the past decade, Victoria is now benefiting from major investment and redevelopment with the unlocking of over three million square feet of new offices, retail and residential spaces.

Traditionally seen as a transport hub for commuters and office workers, Victoria is now establishing itself as a destination in its own right. High end homes, restaurants and boutiques as well as improvements to the public realm are bringing new vibrancy to the area.

Victoria’s lower entry costs for office tenants and improvements to the area are making it an increasingly attractive destination for a number of eclectic companies. This has created a major migration from more traditional locations such as Mayfair and The City. Fashion houses such as Burberry, Armani, Tom Ford and Jimmy Choo, financial institutions including Wellington Hedge Fund and Italian investment bank Mediobanca, luxury car maker Rolls Royce and philanthropic establishment, The Bill & Melinda Gates Foundation now all have offices in SW1.

A number of new high end developments are now being delivered, yet average values remain significantly lower than surrounding prime neighbourhoods such as Belgravia and Knightsbridge. A wealth of new prime residential spaces are providing the catalyst for improved retail and leisure spaces in Victoria, a previously overlooked central London location. Driving this change is the main landowner Land Securities, who are developing more than 2 million sq ft, meshing the innovation and elegance of world-class architecture with quality craftsmanship and design. New upmarket residences are a key part of Land Securities’ plan to create an area to rival London’s most prestigious neighbourhoods. Land Securities isn’t alone in its ambition to transform SW1 into a vibrant new neighbourhood. Amongst others, Northacre, a high end developer, is busy creating its own raft of luxury apartments by Buckingham Palace at No.1 Palace Street.

VICTORIALONDON

For the first time, this busy central London hub is emerging as a destination in its own right,

unlocking a place for Londoners to enjoy and businesses to migrate to, surrounded by

striking architecture and world famous landmarks

St James Park

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Victoria’s enviable position in central London means that it has always been a hive of activity. It rubs shoulders with Buckingham Palace, the Houses of Parliament, Westminster Cathedral and The Goring, London’s last family run luxury hotel. It is surrounded by some of the best parks in the capital and sits alongside some of the most desirable postcodes in London including Belgravia to the north west, Chelsea to the south west and Westminster to the east. Its location also gives easy access to the bustling West End and beyond.

AN ICONIC LOCATION

Victoria is home to 98 acresof Royal Parks

3 underground lines

c.700 overground trains per day

£700 million investment in Victoria Station Upgrade

30 minutes to Gatwick Airport

The Goring Hotel

Buckingham Palace

Victoria has welcomed an influx of places to shop, drink and socialise. Land Securities’ mixed use scheme Nova will complete the area’s transformation. In addition to five buildings encompassing a huge pedestrianised, landscaped public space, a vibrant new restaurant quarter will quickly become an integral part of London’s latest foodie scene.

Hosting an Italian restaurant by Michelin starred icon, Jason Atherton, who is best known for Pollen Street Social and Berners Tavern, an all-day offering from Adam White, the restaurateur behind venues including the Riding House Café and The Garrison, and a Ramen bar and Okonomiyaki restaurant from Ross Shonhan of Bone Daddies fame.

Victoria Street is now home to Curzon’s newest cinema in the capital, an upscale flagship venue with five state-of-the art screens and chic lounge bars.

A SOCIAL SPACE

Computer generated image for illustrative purposes only

Curzon

Royal Quarter Café

Land Securities, The Nova Building

VICT

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RESEARCH

SOURCE: EXPERIAN

202020192018201720162015201420132012

WESTMINSTERGREATER LONDONFORECAST

Economic performance Annual GVA growth

3.0%

1.8%

1.5% 1.6%

3.9%

3.8%

3.2%

2.9%

3.5%

3.4%

3.2%

3.2%3.3%

2.8%

2.8%2.9%

2.9%3.0%

SOURCE: KNIGHT FRANK WEALTH REPORT

Most important cities to the ultra-wealthy 2015

LOND

ON

NEW

YOR

K

HONG

KON

G

SING

APOR

E

SHAN

GHAI

MIA

MI

PARI

S

DUBA

I

BEIJ

ING

ZURI

CH

1 2 3

10

45

6 7 8 9

SOURCE: KNIGHT FRANK RESEARCH

Annual growth in Prime central London prices(forecasts 2015 - 2019)

2019201820172016201520142013201220112010

FORECAST

1%

4% 5% 5%5%

8%9%

12%

10%

6%

SOURCE: KNIGHT FRANK RESEARCH

How residential price performance in Victoria compares Growth in prices, indexed 100=January 2000

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

0

50

100

150

200

250

300

350

400

PRIME CENTRAL LONDON ENGLAND & WALES GREATER LONDON VICTORIA

Residential prices in prime central London have climbed by 76% since the trough of the market in early 2009, averaging just under a growth of 9% a year over the last five years. The pace of growth has eased in recent months as more normal market conditions have resumed. The market is also absorbing changes to stamp duty for properties worth £1.1m and more made in December 2014. Knight Frank forecasts further cumulative growth of 25.8% from 2015 to the end of 2019.

Average residential prices in the area within a 1km radius of Victoria station have outperformed those in prime central London, as well as Greater London since 2000. The average property has risen in value by 88% between the trough of the market, compared in 2009 to Q1 in 2015, to an average 56% increase in the Greater London market. Looking at activity, Victoria has seen the biggest increase in the volume of £1m+ sales in any area of London in the last 12 months once prices are inflation-adjusted, underlining its status as a prime residential area.

The prime London market is underpinned by London’s eco-nomic power, boosting domestic demand, as well as its po-sition as a key global city, attracting international attention. London was ranked as the top destination for the world’s ultra-wealthy in Knight Frank’s 2015 Wealth Report, beating New York, Hong Kong and Singapore.

Looking at Victoria in more detail, it is situated in one of the most vibrant boroughs in London. Westminster is expected to outperform the wider London market in terms of job creation and economic output over the next five years.

SOURCE: EXPERIAN

202020192018201720162015201420132012

WESTMINSTERGREATER LONDONFORECAST

Economic performance Annual GVA growth

3.0%

1.8%

1.5% 1.6%

3.9%

3.8%

3.2%

2.9%

3.5%

3.4%

3.2%

3.2%3.3%

2.8%

2.8%2.9%

2.9%3.0%

SOURCE: KNIGHT FRANK WEALTH REPORT

Most important cities to the ultra-wealthy 2015

LOND

ON

NEW

YOR

K

HONG

KON

G

SING

APOR

E

SHAN

GHAI

MIA

MI

PARI

S

DUBA

I

BEIJ

ING

ZURI

CH

1 2 3

10

45

6 7 8 9

SOURCE: KNIGHT FRANK RESEARCH

Annual growth in Prime central London prices(forecasts 2015 - 2019)

2019201820172016201520142013201220112010

FORECAST

1%

4% 5% 5%5%

8%9%

12%

10%

6%

SOURCE: KNIGHT FRANK RESEARCH

How residential price performance in Victoria compares Growth in prices, indexed 100=January 2000

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

0

50

100

150

200

250

300

350

400

PRIME CENTRAL LONDON ENGLAND & WALES GREATER LONDON VICTORIA

SOURCE: EXPERIAN

202020192018201720162015201420132012

WESTMINSTERGREATER LONDONFORECAST

Economic performance Annual GVA growth

3.0%

1.8%

1.5% 1.6%

3.9%

3.8%

3.2%

2.9%

3.5%

3.4%

3.2%

3.2%3.3%

2.8%

2.8%2.9%

2.9%3.0%

SOURCE: KNIGHT FRANK WEALTH REPORT

Most important cities to the ultra-wealthy 2015

LOND

ON

NEW

YOR

K

HONG

KON

G

SING

APOR

E

SHAN

GHAI

MIA

MI

PARI

S

DUBA

I

BEIJ

ING

ZURI

CH

1 2 3

10

45

6 7 8 9

SOURCE: KNIGHT FRANK RESEARCH

Annual growth in Prime central London prices(forecasts 2015 - 2019)

2019201820172016201520142013201220112010

FORECAST

1%

4% 5% 5%5%

8%9%

12%

10%

6%

SOURCE: KNIGHT FRANK RESEARCH

How residential price performance in Victoria compares Growth in prices, indexed 100=January 2000

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

0

50

100

150

200

250

300

350

400

PRIME CENTRAL LONDON ENGLAND & WALES GREATER LONDON VICTORIA

SOURCE: EXPERIAN

202020192018201720162015201420132012

WESTMINSTERGREATER LONDONFORECAST

Economic performance Annual GVA growth

3.0%

1.8%

1.5% 1.6%

3.9%

3.8%

3.2%

2.9%

3.5%

3.4%

3.2%

3.2%3.3%

2.8%

2.8%2.9%

2.9%3.0%

SOURCE: KNIGHT FRANK WEALTH REPORT

Most important cities to the ultra-wealthy 2015

LOND

ON

NEW

YOR

K

HONG

KON

G

SING

APOR

E

SHAN

GHAI

MIA

MI

PARI

S

DUBA

I

BEIJ

ING

ZURI

CH

1 2 3

10

45

6 7 8 9

SOURCE: KNIGHT FRANK RESEARCH

Annual growth in Prime central London prices(forecasts 2015 - 2019)

2019201820172016201520142013201220112010

FORECAST

1%

4% 5% 5%5%

8%9%

12%

10%

6%

SOURCE: KNIGHT FRANK RESEARCH

How residential price performance in Victoria compares Growth in prices, indexed 100=January 2000

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

0

50

100

150

200

250

300

350

400

PRIME CENTRAL LONDON ENGLAND & WALES GREATER LONDON VICTORIA

HORSEFERRY ROAD

VICTORIA STREET

BELGRAVE ROAD

BUCK

INGH

AM P

ALAC

E RO

AD

EATON GATE

A202

A302

A302

A302

A4

A3212

A3212

A3205

A3213

B324

B323

A3211

A3216

A3214

Cad

og

an Place

TateBritain

B302

B310

ST JAMES’SPARK

VICTORIA

PIMLICO

LondonVictoria

BuckinghamPalace

Gardens

ParkLane

GreenPark

Houses ofParliment

St James’sPark

HM Treasury

ForeignCommonwealth

Office

Victoria Gardens

Vincent Square

Vauxhall BridgeIndustrial

Estate

WandsworthRoad

IndustrialEstateSouthbank

BusinessCentre

BurtonsCourt

RoyalHospitalChelsea

BelgraviaSquare

WESTMINSTER

BELGRAVIA

PUBLIC TRANSPORTACCESSABILITY LEVELS

HIGH CONNECTIVITY

LOW CONNECTIVITY

Victoria

Sloane Square

Pimlico

St James’s Park

Westminster

For the latest news, views and analysison the world of prime property, visit

KnightFrankblog.com/global-briefing

GLOBAL BRIEFING

Please refer to the important notice at the end of this report.

TRANSPORT CONNECTIVITY. There is also evi-dence that residential prices benefit from an augmentation in transport infrastructure as well as the public realm around a transport hub. Work has already started on the upgrade of Victoria station, and this will be completed in 2018. The area is already enviable in terms of connectivity, scoring 6b, the highest possible score in Transport for London’s Public Trans-port Accessibility Level (PTAL) measure, which measures the connectivity of an area.

KEY DEVELOPMENTS OF 40+ UNITSSchemes shown are in planning, have planning permission granted, are currently under construction or just completed

VincentSquare

10 DowningStreet

Metropolitan Police

21 DARTMOUTH STREET Developer: Henley HomesTotal units: 46Planning status: Permission - FullConstruction status: Not Started

55 BROADWAY Developer: Transport for LondonTotal units: 112Planning status: Permission - FullConstruction status: Not Started

NO. 1 PALACE STREET Developer: NorthacreTotal units: 72Planning status: Permission - FullConstruction status: Not Started

55VS Developer: Alchemi GroupTotal units: 57Planning status: Permission - FullConstruction status: Under Construction

KINGS GATE Developer: Land SecuritiesTotal units: 100Planning status: Permission - FullConstruction status: Build Complete

THE NOVA BUILDING Developer: Land SecuritiesTotal units: 170Planning status: Permission - FullConstruction status: Under Construction

GROSVENOR GARDENS HOUSE Developer: Key Platinum Investments LimitedTotal units: 42Planning status: Permission - FullConstruction status: Not Started

130 WILTON ROAD (STOCKLEY HOUSE) Developer: Victoria Gardens Development LimitedTotal units: 109Planning status: Permission - FullConstruction status: Not Started

84 ECCLESTON SQUARE Developer: Mosaic Properties InternationalTotal units: 99Planning status: ApplicationConstruction status: Not Started

63 BUCKINGHAM GATE Developer: Anquila CorporationTotal units: 65Planning status: Permission - FullConstruction status: Not Started

KNIGHTSBRIDGE

BELGRAVIA

CHELSEA

Victoria

Hyde Park Corner

Sloane Square

Pimlico

Saatchi Gallery

Royal HospitalChelsea

Tate Britain

Big Ben

BuckinghamPalace

LondonVictoria

St James’s Park

St James’s Park

Westminster

Green Park

BelgraveSquareGarden

Hyde Park

ECCLESTON ST

A202

GROSVENOR ROAD

BIRDCAGE WALK

A3217

A4

A302

A321

4

CHELSEA BRIDGE RD

Key developments of 40+ units in planning, with planning permission granted or currently under construction

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RESEARCH

WestminsterAbbey

BuckinghamPalace

WestminsterCathedral

The Goring hotel

EatonSquare

The Guards Museum

VincentSquare

SloaneSquare

Elizabeth Street

BelgraveSquare

Curzon Victoria

Cardinal Place

VictoriaStation

HorseGuardsparade

St. James Theatre

BuckinghamPalace

Gardens

Victoria PalaceTheatre

HYDEPARK

GREENPARK ST JAMES’S

PARK

PIMLICO

V ICTORIA

BELGRAVIA

MAYFAIR

WALK TIMES0-6 MINUTES

6-12 MINUTES

12-18 MINUTES

Houses of ParliamentBig Ben

Annual rental value growth in prime central London was 2.4% in September. Rents have been growing in the prime central market for 14 consecutive months after a period of declining rents. The pace of rental growth has moderated in recent months against the backdrop of jittery financial markets and concerns about the global economy. This has been reflected in more uncertainty among companies about recruiting, and led to more conservative relocation budgets for senior executives. However, this trend is less marked in both lower and higher price brackets. Demand among younger professionals remains strong while demand at the super-prime level of £5,000 per week and above has been buoyed by the fact tenants have moved across from the sales market due to last December’s stamp duty increase.

SOURCE: KNIGHT FRANK RESEARCH

96

98

100

102

104

106

108

Prime Central London Rental Index

Sep-

15

Jun-

15

Mar

-15

Dec-

14

Sep-

14

Jun-

14

Mar

-14

Dec-

13

Sep-

13

Jun-

13

Mar

-13

Dec-

12

Sep-

12

Jun-

12

Mar

-12

Dec-

11

Sep-

11

Jun-

11

Mar

-11

Dec-

10

RENTAL GROWTHJAN - SEP 2015

HOUSE

FLAT

2.10%

1.30%

Walk mapVictoria: Highly Connected. Walk-time map from Victoria Station

Prime Central London Rental Index

Victoria is well connected to the whole of central London, with Westminster, Harrods and the River all accessible within 20 minutes on foot.

For the latest news, views and analysison the world of prime property, visit

KnightFrankblog.com/global-briefing

GLOBAL BRIEFING

Please refer to the important notice at the end of this report.

Average sales price

above £5m

£1.25m - £2m

£2m - £3m

12 months to Sept. 2015

£3m - £5m

sub £750k

£750k - £1.25m

1 mile

0.5

miles

M A Y F A I R

G R N R K

E EP A

K N I G H T S B R I D G E

B E L G R A V I A

V I C T O R I A

P I M L I C O

V A U X H A L L

C H E L S E A

S T . J A M E S 'P A R K

H Y D E P A R K

Price performance Local over and underperformance compared to average growth in 1.5 mile radius. Price performance measured since January 2010

Sales price map Average capital values of all sales (new-build and secondary market) in 12 months to September 2015.

This map shows how average prices have performed in and around Victoria since 2010. The average growth is taken from all sales within the area shown on the map, and the red areas show where prices have grown by more than average, and blue the areas where capital value growth has yet to catch up.

This snapshot of average capital values of all residential property, new-build and existing stock, shows the highly localised nature of the central London market.Source Knight Frank

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0 CONTACTSLONDON RESIDENTIAL DEVELOPMENT

Richard Klein+44 20 7861 5105richard.klein@knightfrank.com

James Cohen+44 20 7861 5377james.cohen@knightfrank.com

Seb Warner+44 20 7861 5426seb.warner@knightfrank.com

Gráinne Gilmore+44 20 7861 5102grainne.gilmore@knightfrank.com

INTERNATIONAL PROJECT MARKETING RESEARCH

Important Notice© Knight Frank LLP 2015 – This report is published for general information only and not to be relied upon in any way. Although high standards have been used in the preparation of the information, analysis, views and projections presented in this report, no responsibility or liability whatsoever can be accepted by Knight Frank LLP for any loss or damage resultant from any use of, reliance on or reference to the contents of this document. As a general report, this material does not necessarily represent the view of Knight Frank LLP in relation to particular proper-ties or projects. Reproduction of this report in whole or in part is not allowed without prior written approval of Knight Frank LLP to the form and content within which it appears. Knight Frank LLP is a limited liability partnership registered in England with registered number OC305934. Our registered office is 55 Baker Street, London, W1U 8AN, where you may look at a list of members’ names.