In focus: The lasting value of development advisory for stranded commercial assets
We hit the ground running in 2025 by repositioning our development advisory service. Six months on, development director for special projects Andrew Shaw and real estate director Ben Davis reflect on the fine-tuned offering and the opportunities ahead.
From market and financial feasibility to funding and exit, at Saxbury we cover all development advisory bases. With seasoned hotel and aparthotel development and acquisitions specialist Andrew Shaw joining our team earlier this year, we’ve finessed our offering to deliver lasting value and straight-talking advice at every stage of a project.
Timing of our Q1 2025 launch couldn’t have been more apt, with stranded assets and stalled projects an ongoing reality for many commercial landlords and developers, “In a sticky market where people aren’t necessarily ready to push the button and dispose of an asset, we provide sound advice to help bridge the gap and make informed decisions,” says Ben.
“We cover everything,” adds Andrew. “Whether that’s the adaptive re-use of a building into a hotel, serviced apartments or a co-living scheme, or hotel management agreements, lease structure advice, and exit strategies. There’s a breadth to what we can do.”
Why did you decide to relaunch Saxbury’s development advisory offering?
Ben: It was the right time. Having welcomed Andrew – and his three decades of experience as a development and acquisitions specialist – to the team, we could really elevate and consolidate our services. It’s also the opportune moment in terms of the industry. In the current climate, we’ve noticed owners and developers are looking closely into converting existing buildings from declining use classes – like offices – into hotels. No matter how good a developer they are though, without understanding the intricacies of building and operating a hotel – from space planning to cash flow, how they’re managed, who operates them – it can be a process fraught with unknowns.
Evidently, there’s a void of information out there and we felt that by leveraging Andrew’s extensive experience and track record, we had a renewed and enhanced proposition to offer as a team.
Andrew: The decision was also borne out of the meetings we’ve been having. There is clearly a need for trusted, strategic development advisory guidance. We’re seeing developers who are struggling to figure out what approach they should take and how best to unlock the value of a site. We can help anyone to understand the highest and best use for a particular building, site or project. We’ll sit with a developer or investor and analyse their project in detail to help curate the most appropriate size and scale of scheme, operating structure and exit strategy. We bring full-spectrum development insight from concept to completion.
What does Saxbury bring to the table in this department? How can we help?
Ben: If you’re an owner, obviously you’ve got choices. You could speak directly to a hotel brand, for example, but they’re going to give you a very nuanced scheme. By comparison, we can help you understand what will deliver the best returns. Take the pre-planning stage, it could be a question of keeping a project generic enough to suit multiple operating solutions, rather than being too specific.
Andrew: It’s sense checking, in a way, of all the moving parts that go towards making a viable and successful hotel or serviced apartment scheme, and one that delivers the developer or investor their required returns on exit. There’s potential for confusion among owners and developers right now because there are so many more choices in terms of operating solutions, franchise brands and financial structures. Our role is also about matching the right management company with the right brand in the right location for the right development.
What types of projects do we work on? What’s the scope of the Saxbury service?
Andrew: We can step in at any point in the development process. Let’s picture a developer with a redundant office building, who doesn’t quite know what they should do. It probably isn’t feasible as an office anymore, but is it a hotel, serviced apartments or perhaps some kind of mixed-use scheme? We can steer them through from beginning to end – so from design advice on layouts, guest and staff circulation and value engineering net to gross areas, to working with an architect to ensure a scheme is going to be brand compliant, right through to operator selection, construction, asset management – a full lifecycle of advisory services. We can also help with exit strategies on stalled projects, whether that involves leasing or selling the site as is, with planning consent or as a completed development.
What’s your long-term vision for the offering and where do you see the opportunities in terms of development advisory?
Andrew: In the short-term, we’re positioning ourselves for a more stable economic environment. There’s better availability of debt and stabilising build costs – and overall, a more positive transactional environment. We’re also cognisant of the head winds the hospitality sector is currently facing in terms of increased operating costs, be it wages, employers’ national insurance, energy costs, property taxes – all of which put pressure on P&Ls and profit conversion.
The development market is still challenging but it is becoming more transparent, and we’re well equipped to advise developers who are still uncertain about what they need to do or what they can do with a site. Ultimately, we help them back the right horse in terms of use and structure.
Ben: We’re here for the long-haul though, and the relationships and experience we’ve built will continue to stand us in good stead. Collectively the world is still waiting for a lot of things to happen right now, but interest rates are coming down and hotels remain a good inflationary hedge. From what we’re seeing, there’s still plenty of appetite among developers and investors to build, own and expand within the hospitality sector.
We’ve spent 10 years and counting building relationships within this niche. By working with us, clients can leapfrog a decade of relationship building, giving them a strategic edge both now and in the future.