After the Second World War London was a wreck. Regent Street was desolate and nobody believed shops would ever regain former values. The City of London was a bomb site and there were still craters in the 1970s.
A smart group of tycoons saw the opportunity. Harold Samuel, the founder of Land Securities, Charles Clore, who bought Selfridges, and Max Rayne, founder of London & Merchant Securities, had the vision to see a reconstruction opportunity, not holes in the ground.
Online shopping and the pandemic have had an effect on real estate. Retail parks and shopping centres have suffered, working from home has trashed rents and values of offices.
Shoppers return to Regents Street after lockdown restrictions were eased earlier this year. Private Equity firms have begun targeting struggling landlords and developers
Developers, such as Land Securities, increasingly are turning to housing to revive fringes of city retail parks.
Private equity vultures with bulging wallets and a willingness to use debt are bargain hunting. St Modwen, chaired by Danuta Gray (a rare firm with a female chair and chief executive), is a case in point.
Targeted by Stephen Schwarzman’s sprawling Blackstone group, which made a half-dozen offers before moving in for the kill, Gray and her fellow directors at St Modwen decided to sell out for £1.2billion rather than fight. This, despite the opposition of key investor JO Hambro.
The speed of capitulation by Gray and her advisers is embarrassing. What is particularly dispiriting for the UK, which leads Europe in online shopping, is that at least half of St Modwen’s portfolio is in the fast growing and highly valued logistics and warehouse space.
It would not have been beyond the wit of a more ambitious board to have spun off the under-performing housing arm and focused on building St Modwen into something for the current century.
Instead, if Blackstone buys it on the cheap, it will end up as a small under-appreciated asset owned by the world’s biggest landlord.
Blackstone at least recognises that the havoc wreaked by Covid is an opportunity. It views real estate as the new promised land.
In Asia it is close to snapping up Hong Kong-based office developer Soho China for £2.1billion. Among its assets is the Wangjing Soho in Beijing, designed by Zaha Hadid.
Blackstone is not the only private equity firm looking for bargain properties. Bain Capital has come together with Reef Technology to seize control of car parking giant NCP, built by war hero Donald Gosling.
The initiative, vision and entrepreneurship of a post-war generation of developers is being ceded far too easily to secretive, unaccountable private equity exploiters.
Central banks spent decades restoring trust in money and beating back the scourge of inflation.
Quantitative easing, by the Bank of England and other central banks in the pandemic, helped prevent mass unemployment and bankruptcies in the Covid era.
It also has resulted in bizarre outcomes. The surge in the use of crypto-currencies is a recognition by some investors that the dollar, sterling and other fiat currencies are no longer trusted.
Central banks have argued that there is no need to fear inflation because there is plenty of productive capacity in the global economy.
Is that true any longer? As we come out of Covid, big shortages have developed for raw materials such as timber as well as advanced products such as semi-conductors.
Action by the Western democracies to replace carbon-emitting fuels is slowing oil exploration and production, sending energy prices soaring.
Concern must be that the makings of a new age of inflation are entrenched and far from transitory, as the Bank of England suggests.
The lift in consumer price inflation to 2.1 per cent in May from 1.5 per cent in April is significant, with fuel price a huge driver. Beware!
Antony Jenkins, who sought to set Barclays on an ethical journey after the Bob Diamond era, was bundled out of office in 2015 without ceremony.
He is having the last laugh. Jenkins has put his retail skills to work, creating 10X Future Technologies, which provides cloud-based platforms allowing banks to wean themselves off clunky patchwork IT.
JP Morgan, Blackrock and others believe he is onto something and have taken part in a fundraising, putting a value of £500million on it as it pushes into North America.