More Thoughts

How are business practices different in the UK and in each of its regions?
My view on this is limited given most of my time was in London, and the time in Cambridge was
more focused on real estate and academics. I think the main differences lie in the populations of
people and businesses among regions. London, being by far the most international city, has far
more expats and service-based businesses than other cities. Any non-manufacturing
multinational firm based in the UK is seemingly required to have a presence in London. The
diverse population base of the primary city also has a large impact on the difference in business
landscapes between it and the other metropolitan areas. From what Ive read it doesnt seem that
there are significant differences in business cultures between the different parts of England, but
vastly different business landscapes. This might not be the case when looking at Scotland,
Wales, Northern Ireland, etc.
How is business etiquette different from the U.S.?
The main differences I observed were regarding how small talk comes about and the topics of
conversation. It seemed British business people were more inclined to start conversations about
politics or world events than back home. Maybe it was because they didnt expect us to follow
the same teams and sports as them, but I was shocked that none of the British businesspeople we
met with brought up sports in casual conversation. Based on the format of presentations/meetings
I was a part of, it also seemed there was a little bit more time devoted to each party getting to
know one another.
How is classroom etiquette different?
Given we didnt attend any lectures with UK students, I cant answer this extremely well.
However, I learned about some very interesting differences related to how the education systems
are structured differently. The most noteworthy part was that British secondary and university
students focus on their ultimate field of study much earlier and with fewer general education
courses to spend time on. Also along the lines of more intense academic focus, working while in
school (excluding summer internships) does not seem to be popular at all in the UK. In fact,
some schools like Cambridge prohibit students from having a job while enrolled in classes.
How important is London to the UKs other large cities, and vice versa?
During the KPMG presentation, we were show residential and job migration patterns for the UK
over the last several years. In summary, essentially every UK city other than London has recently
seen people and jobs leave it for London on the aggregate. There have been efforts to spur
development in cities like Manchester and Liverpool in order to reverse this trend, but only time
will tell if they are successful. Looking in the opposite direction, as London struggles to cope
with a growing population and rising housing prices, it would actually stand to benefit in many
ways from strong secondary UK cities. I think it would be unfair to characterize one side as
being dependent on the other, but they do influence one another. As a couple British folks I
spoke with put it, in many aspects London is virtually its own country.

How problematic are the quickly rising average home prices in and around London?
Along with anticipated negative impacts of a potential Brexit, this is probably Londons largest
economic problem. While the economy has been relatively stable over the last few years, many
believe that a lack of affordable housing has the potential to be an enormous problem in the
intermediate and long-term. Slowly, there is rising sentiment that many people and businesses
will soon begin to explore the possibility of relocating if real estate continues to quickly become
more expensive. Given the lack of available land and numerous building restrictions, the supply
side of the equation has little room to change. As such, it would take a decrease in demand
(which would probably be spurred in part by Britain choosing to leave the EU) for prices to
lower.
How dependent is Londons economy on the continued success of its luxury property
market?
Given the price levels across the market, it would probably depend how you define luxury.
Generally speaking, though, the answer is probably not as much as most would expect. One of
the more interesting things relating to real estate I learned on this trip was that London (at least
compared to the US) has far more corporate and institutional investment interest and ownership
in its commercial property than residential. At the higher end of the residential real estate there is
very little institutional ownership, so the biggest impact of any luxury property market shifts
would be on the ultra-wealthy.
In terms of property and business environment, how does London compare to New York?
In terms of business environment they are very similar. London, largely because it is smaller and
geographically closer to many more countries, seems to be the more international market. The
two also have very similar rankings in terms of how business friendly they are. The US has much
higher business income tax rates, but significantly lower personal income tax rates than the UK.
In terms of property, London is more expensive, more heavily regulated, far more impacted by
history, more internationally-controlled, and less corporate-owned in the residential property
space. UK laws governing real estate investment trusts (REITs) are also far less favorable for the
companies than US rules. Apartments and residential units for rent are far less common in
London. Because of the higher prices and demand, commercial property in London is also
operated under terms generally more favorable for the lessor than in New York.
What future developments are in the works?
The biggest, at least in terms of size, is the Kings Cross re-development we had the chance to
tour. Located just a few miles north of the city center of London, this area is comprised of 67
acres and over 50 buildings either finished or in process. Per their official website, What was an
underused industrial wasteland is being transformed into a new part of the city with homes,
shops, offices, galleries, bars, restaurants, schools and even a university. When completed, this
mixed-use city within a city will house tens of thousands of workers, residents, and students in a
modern landscape. There are plenty of developments in progress around the city, but this will

probably be the most impactful due to its enormous size and scope. Its the largest urban
redevelopment in all of Europe, and will transform previously little-used space into much needed
areas to live, work, and play.
How exactly does the federal structure with the UK and England/Scotland/Wales/Northern
Ireland work?
In a system somewhat similar to America, the UK features a combination of a national
government and subsequent lower levels of government. Since the late 1990s Scotland, Wales,
and Northern Ireland all have a form of devolved government (similar to the 50 state
governments in the US) within the UK as well as representation in the overall
Parliament/government for the United Kingdom. England is governed directly by the Parliament
of the UK. The UK government has authority over a number of explicit matters such as UK
taxes, international relations, and defense. Each country governs all other matters within its
jurisdiction through its devolved government. Scotland and Northern Ireland each have distinct
legal systems from the combined one of England and Wales. Within each country, counties and
cities/boroughs have local governments just as American municipalities do.
How does London compare with the other large western European cities like Paris and
Berlin?
Even though some of the businessmen here may be biased, but it seems pretty clear that London
is at the top of the list in terms of its status as a global business, property, and financial center.
Beyond this, without having firsthand experience in any other major European cities, it would
probably be foolish of me to attempt to answer this further.

Notes about some other topics of interest:

-Sustainability
Through the Kings Cross visit, I got some good insight into how UK developers and landowners
think about sustainability and environmental issues, especially when redeveloping former
industrial space. Im not an environmental engineer, but there is so much that goes into this
beyond my level of understanding. From those in the field it sounds like nearly all developers
property owners are at least somewhat mindful of their environmental footprint, whether it is a
box they want to check or a central part of their mission. Similar local and/or national tax
incentives also help encourage land-owners to strive for efficient structures that will minimize
environmental impact. With land as limited and valuable as it is, this becomes even more
important.
-Urbanization/Gentrification
It seems there is a lot more migration between cities than from rural areas to urban ones. As of
2015 about 83% of the UK population was urban with an annual urbanization rate of less than
one percent. Within London, cars are popular enough (and the streets small/old enough) that the
city has some of the worlds worst traffic. However with the worlds largest subway system (in

terms of distance covered), a major bus network, and train lines to many other parts of the
country and continent, public transportation is fairly simple for those who dont wish to drive. As
much as London has grown, the city preserves a great deal of its historic architecture and a very
large network of public and private parks. As the city evolves and becomes more expensive,
there dont really seem to be bad neighborhoods in the heart of or very close to the city. The
land is almost too expensive to not be desirable When talking with students at Cass Business
School, it was amazing how far away most of them lived from their school. In the US, even in
New York City, students who dont live with their families usually find housing within walking
distance of campus. In London it seemed relatively common for international and local students
not living with their families to be a 20-minute train ride or further away from school. Certainly
other lower-income people would be in a similar situation as these students in reference to their
jobs. In general, the more affordable housing you want the farther outside the city center you
have to look.
*All answers subject to some bias and lack of complete information.