As the seventh anniversary approaches of the takeover of independent property adviser Drivers Jonas by accountancy giant Deloitte, Manchester partner Simon Bedford says the deal has been a success but not without suffering some pain along the way.
The January 2010 deal saw the 670-strong Drivers Jonas partnership absorbed into a global group of 17,000 staff. At its pre-takeover peak Drivers Jonas employed more than 100 people in Manchester. There are now 70 people in Deloitte Real Estate’s base in Spinningfields, headed by five partners. Nationally there are 280 in Deloitte Real Estate. The Drivers Jonas Deloitte brand was replaced by Deloitte Real Estate in 2013.
The firm has suffered a series of notable departures in recent months. Partner and head of office, Michele Steel, joined client Select Property Group. Ellie Philcox reunited with ex-Drivers Jonas colleagues Euan Kellie and Kelly Paddick at Euan Kellie Property Solutions. James Sidlow moved to Allied London, working on the developer’s St John’s project. Deloitte sold its transactions business in parcels to Knight Frank, Savills and Gerald Eve, four staff moving across to the latter in Manchester as part of the last deal in May.
Bedford, who is spending more time in Manchester these days after a spell concentrated in London, reflects: “Real estate has gone through a difficult period and we have lost some very talented people. We would have liked them to stay.”
He added: “It is fair to say Drivers Jonas was one thing and Deloitte is something very different.”
Bedford said the real estate business remains in good shape in Manchester with an annual turnover of £7m and a strong order book. Clients include the Co-op, Nuclear Decommissioning Authority, Diageo, Transport for Greater Manchester.
Instead of transactional agency advice, which often found Deloitte conflicted in deals for audit clients, according to national reports, the real estate division is now focused on valuation, planning and construction advice, including quantity surveying and project management.
Adding Drivers Jonas to the group did not result in the sorts of fee generation from selling land holdings for tax clients that the premise for the tie-up predicted. “We thought that would be the main opportunity but it hasn’t been. What we have got instead is much more than that,” Bedford says. The model now is about “connecting real estate back into the core business,” through “assurance” work, taking the risk out of property projects. “Our clients are looking for more than professional services.”
He continues: “I firmly believe [the acquisition] has been successful. A lot of our people know a hell of lot.”
Manchester is the second biggest UK office, after London, says Bedford, but “half of the people here don’t work on projects in the North West”, a source of frustration due to the relative lack of regional recognition he believes the property team receives for their efforts.
One area the firm is extremely well known for in Manchester is for its planning team advising developers on major city centre projects. Certain rivals accuse them of having a near monopoly in this area, and the council of “bumping off” other consultants to be replaced by Deloitte, which both parties deny. Asked why Deloitte’s name appears for the applicant on so many planning applications in the city core, Bedford responds: “Because we’re good.”
He continues: “We have worked hard on keeping a good working relationship with Manchester City Council, and we have got a healthy relationship, not cosy.”
This close relationship goes back 15 to 20 years, the baton handed down periodically from one head of planning to the next; John Adams, now national head of planning based in London, to Graham Stock, now an entrepreneurial importer of carbon mountain bike parts in South Manchester, to the current head of the 20-strong planning team, John Cooper.
The list of live projects Deloitte is advising on in the city include Mayfield for U+I, Allied London’s St John’s and XYZ, Circle Square for Select and Bruntwood, as well as others at Murray’s Mills, New Unions Street, Cambridge Street, First Street South, Oxygen Tower, Angel Gardens and more. A quick tally by Place North West found Deloitte instructed on 15 out of 20 of the biggest schemes approved or moving on site for construction recently in the city centre.
With a case load like that perhaps there is no need to worry about recognition. Meanwhile, the business has been hiring locally. Three graduate planners joined in September. Planning assistant director, Ed Britton, joined from GL Hearn and Rachel Poole relocated from Deloitte London.