Jeremy, you started your career with Grosvenor in 1976 as a graduate. What advice would you give to our new graduates about how they and Grosvenor should face up to such a changing world?
We all have to find a way to embrace change because it is constant, inside and outside the Grosvenor Estate. My approach is never to feel satisfied with the status quo, to think carefully about the future and to try to make continuous improvements. For me, this works as career advice as much as how to manage my relationship with a customer or make better investment decisions. I confess, I really like change. I find it thrilling to think about how many stables there were on the London estate in 1890 and how our predecessors had to grapple with the vast ramifications of the motor vehicle; when I started work here, it was unthinkable that I had to type anything myself – and not all the typewriters were electric; £12 per square foot was the best rent you could expect for office space and that was a lot more valuable than residential. The next 25 years will be about intelligent machines as more and more professional tasks are handed over to ‘robots’. If this gives a sense of the dramatic changes centred on technology, the changes in society will not be much less.
I do have advice for senior management: listen and learn from our younger people. They may yet lack some of the slick ways we find to engage easily in the business planning process but they have all the ideas we need.
We often talk about ‘placemaking’ at Grosvenor. What are the most important factors that contribute to the making of a place? How can our international experience inform us better?
Places can be defined physically, but they are made by the way people relate to them. We assess them instinctively by the degree to which they inspire. Think of the Grand Mosque in Abu Dhabi, Lan Kwai Fong in Hong Kong and Hyde Park in London – all very different and, of course, all part of larger places. The trap that developers can fall into is thinking about places with hard boundaries. Few of us operate on such a scale that complete places are involved. This means we must absorb and engage with outside influences. A wonderful place can be where people live or work or just pass through and it might even be ‘ugly’. The inspiration can be stimulated by people alone but, more often, I think spaces and shapes are the catalyst and this means that design is important. We British have an embarrassing tendency to think we know the answers and can be a bit dismissive of ‘foreign’ influences and cultures. This is so wrong. Grosvenor gains enormously from working in so many successful places around the world, in cities that are regularly cited as among the best; cities like Vancouver, Stockholm and San Francisco.
How do you feel about the way Grosvenor Group’s thinking on ‘Living cities’ has evolved?
First, I remind myself that ‘Living cities’ is essentially a strapline – but it is a great one for us. It is like a panoramic window from which we can see back to our heritage and our deep understanding of places, accumulated over hundreds of years; and can see forward to the way people want to live in cities and how we must help to shape their future. More than this, as cities must tread more lightly on our planet if they are to remain living for future generations, we can observe how we must improve building materials, design to promote health, use all resources more efficiently and so on.
Those looking in through the window must see our commitment, must be able to trust us that these are not merely words. Stamping ‘Living cities’ on everything we do is very demanding on us. We have to earn others’ trust and not just cloak ourselves in fine words. I have always believed that if we can satisfy our own high standards, we will have a good story to tell.
Why has it remained so unusual for property companies to attempt our international reach?
For me, the biggest underlying influence is the short-term outlook of investors (and, by the way, I would never say they were wrong from their perspective). The need for shorter-term certainty encourages specialisation.
Add to this there being no greater business challenge than to manage globally, and you can see why staying in one country has become a requirement for listed property companies. In our case, our Shareholders think long term and want diversification – not just the geographic dispersion of assets but the diversity of cultural influences and multiplicity of decision-making points around the world. We are not a single global business, we are an internationally diversified group of businesses. By devolving all decision-making to local companies, I think we have found a way to combine short- and long-term thinking into our model.
What is long-termism and why is it so important to Grosvenor?
Long-termism is simply placing the long term ahead of the short term. It doesn’t mean no interest in the short term but all decisions are easier when considered against the long-term objective. I think abstract notions like ‘long-termism’ can be dangerous and timescales should always be articulated. Ultimately, we are all stewards and our responsibilities are to the future, not to ourselves. This is the Grosvenor family philosophy and it is our business philosophy. Of all the things I could get evangelical about, this is the main one because I believe our places, our politics and our society would be better with more genuine respect paid to the long term. It’s a great advantage for us to stick to our long-term view.
For more, please see our Annual Review 2015.