This month’s decisive, if unexpected, victory for the Tories has given a boost to the UK’s real estate markets. Following an already strong 2014 and now with even higher expectations for continued growth in 2015, the UK is an interesting play. In light of this amiable confluence of factors and the increasing difficulty of finding yield here in the States, it’s perhaps time for a rousing rendition of George M. Cohan’s “Over There.”
And hey, legally speaking, it’s a terrific place to invest. It’s a hot bed of red in a tooth and claw capitalism (at least compared to our other European friends). The UK has a robust and broadly understandable legal system and a respect for property rights soundly rooted in the common law; all in all, a genial environment for investment.
But before we pack our kit (okay, perhaps I’m pushing the WWI thing a bit far now), we should take a moment to remember George Bernard Shaw’s famous maxim (which may be apocryphal): “We are a single people divided by a common language.” Translating legal and business concepts across the pond is a funny business. It seems that we ought to understand those blokes (and they, us). If it were only so easy as to swap out “s” for a “z!” Beware of assuming that you got it just because it sounds like you got it right. Not to be cheeky (how UK-ish), but in what world should “pissed” mean drunk over there and just plain pissed here? Get that wrong and bad behavior may ensue. As that great past chair of the Federal Reserve Board Alan Greenspan famously said, “if you think you understand what I said, you are surely mistaken.” Common meaning can be both elusive and illusory!
Obviously we’re going to retain skilled solicitors to deal with UK commercial real estate issues (please think Dechert, London), but our point here is that it’s critical to do a little homework before embarking on a British Invasion. As an international law firm with offices around the world (and our second largest office is in London), Dechert has vast experience handling cross border transactions and translating between and among our US and English colleagues and clients. We’ve found it’s often very easy for understanding to pass like ships in the night. And so to help you with your homework, we offer up to you two guides which were prepared by our London office: The Essential Guide to Mortgages and Charges Over Land and The Essential Guide to UK Real Estate. These guides provide a broad overview of the various legal aspects of real estate law and financial transaction requirements in the UK and answer such burning questions as “What is security of tenure and how will that impact my investment?”, or “Will the acquisition of a debt portfolio result in obligations to take on employees?” Doing a little homework into the mysteries of the UK version of our common law will pay enormous dividends when pursuing opportunities in Great Britain. Cheers!