Member Article

Knight Frank announces record profits

Global property consultancy Knight Frank, which has offices in Leeds, Sheffield and Harrogate, has announced its financial results for the year ended 31 March 2015 reporting a record £162m profit and £443m turnover.

The highlights are:

Group profit before tax up 19% to £162.0m (2014: £136.6m)

Group turnover up 13% to £443.1m (2014: £392.7m)

Strong balance sheet with net cash balances at £167.8m (2014: £141.7m)

Knight Frank’s two commercial property offices in Leeds and Sheffield had their most successful year ever.

Alistair Elliott, group chairman and senior partner of Knight Frank said: “I am pleased to report another strong set of results for our latest financial year. We have achieved a 19% increase in profit, whilst continuing to invest significantly in recruitment and expanding our global platform.

“We continue to grow our network, recruiting the best people in key markets across the world. We believe it is this approach, as well as our unique partnership model that allows us to maintain a strong unified culture, the benefits of which our clients experience across our network.

“Our priority for the year ahead is to continue to develop our key services in the principal cities of the world. Our global strategy is working and we are winning more best-in-class instructions, especially in capital markets, valuations, residential sales, tenant representation and office leasing.

“The benefits of a balanced business are, I believe, being delivered. At a time when activity in commercial occupier markets is increasing in many cities around the world, we see the return of rental growth drawing more investor interest.

“For many investors, total returns still represent fair value. As yields harden further, we believe this will culminate in an increasingly active development market with investors focussing on development returns to counterbalance the flatter yield profile.

“Cross-border growth in residential development and investment continues. While some of this activity relates to portfolio and risk diversification, in the main it is a reflection of the closer economic interdependence of our key markets.

“In particular our growing presence in prime locations across London and our enhanced coverage of New York, Miami, LA and Sydney has helped to cement our offering to clients looking for access to the world’s leading employment centres.

“The specialist property sectors (including hotels, student property, healthcare, residential capital markets and automotive) are becoming a more central part of investors’ portfolios and solid returns over turbulent periods have increased their appeal. We will continue to invest in these key components of Knight Frank’s global offering.

“In Europe, fortunes are varied. This reflects the reality of the multi-speed markets across the Eurozone. Dublin and Madrid have outperformed while the French and German markets remain mixed. With the exception of Russia, the real estate markets in Central and Eastern Europe remain strong.

“In the UK, commercial real estate activity has increased and there is now significant life in the sector. Our 10 commercial offices across the UK have had their best year ever. The residential market is more mixed, with the prime sector still absorbing the changes to stamp duty made last December, especially in central London. That said, the market continues to be underpinned by a combination of undersupply of housing, the improving economy and the low interest rate environment.”

This was posted in Bdaily's Members' News section by Robert Beaumont .