Keynote | Opportunity London, Opportunity Net Zero: A new partnership approach for the capital

Speaker: Jace Tyrell – CEO, Opportunity London

Welcome everyone to ‘Opportunity London’!

Now what I would like you all to do is stand up, shake yourself a bit and turn to the person to your left and to your right and say, ‘WE LOVE SOUTH LONDON’.

I certainly LOVE South London and I want to thank you Cllr Roberts and your colleagues from BIG South London (great acronym by the way) and London & Partners for extending an invitation to join you all today.

I’m week two back from my sabbatical down under, I certainly didn’t return for the weather, clearly, but really elated to be part of this very timely and important dialogue that you have brought together today and a conversation that is happening globally in Board rooms, local leaders and business forums, City Mayor’s and Governments.

As you have given me 25 minutes, what I would like to do is set out What, Why and Who is Opportunity London and then share the big trends for low-carbon institutional investment and why I believe we have reasons to be optimistic for the future.

First of all, hands up if you are familiar with Opportunity London and what we are seeking to do with our partners across the capital.

OK – always good to know your audience….

Let me give you some context on the macro global picture, where our Opportunity London aims to fit into the world eco-system and the importance for South London, in particular our partners in Croydon, Richmond, Kingston, Merton and Sutton.

Well, when I wasn’t catching waves, having a beer and enjoying the sun in Bondi Beach – I did have the opportunity to venture a fair bit around the region.

Travelling in a post-COVID world is utterly eye-opening. The exam question – what makes a liveable city, with new working and lifestyle patterns, heightened priority of health and wellbeing, and an increased cost of living?  If the last year spent in Sydney and travelling across Asia-Pacific has taught me anything, it’s the sheer scale of possibility in the built environment to support a post-pandemic society.

The level of ambition and investment taking place across the pan pacific markets, in the living sector, green infrastructure and cultural assets, is driving a new wave of capital deployment that puts people and place first, – absolute parallels here for us in London.

But one thing that is acutely apparent, more than ever, and that is…

Global capital has a choice.

One should never bet against London, it has proven resilient for centuries. And according to JLL’s recent report – London is on the verge of becoming Europe’s first trillion-dollar urban economy. – South London a major part of that offer for good growth.

However, return and impact matter.

The last decade has seen over £100bn of investment into London, from the Elizabeth Line to the Olympic Park, King’s Cross to Wembley Park, the City Cluster to Canary Wharf, Barking Riverside to Battersea Power Station – inward investment has unlocked transformational change in London. And we’re really excited about the London Cancer Hub redevelopment in Sutton.

Our great collective challenge now is to attract the next wave of £100bn of investment and in a way which continues to benefit our Boroughs, Communities and all Londoners.

In energy we need new green infrastructure, EV charging and a huge retrofitting agenda to bring buildings up to modern standards of environmental performance.

In real estate there remains opportunities across the mix, from housing to life sciences, logistics to film & media production.  And we must continue to develop our city’s transport infrastructure, digital communications, and waste management.

Opportunity London will pull all of these funding opportunities together into a London Investment Prospectus to broker and guide global capital, right here.

Opportunity London is a really unique partnership – bringing civic and business leaders – genuinely together on a shared mission to win capital for our great City.

We were set up by London and Partners with the New London Architecture with a mission in uniting London with one voice. We are backed by all the London Boroughs, the Mayor of London, London Councils, the City of London Corporation, London Business Improvements Districts and senior business leaders – the first time all tiers of London Government of all political colours have united together with business to promote vital investment opportunities for our Capital.

Our top mission is to drive business development and brokerage across real estate, regeneration, infrastructure and energy.

We all know if London has long-term investment in low carbon energy and transport, new economies and living infrastructure – for its people and businesses – then South London wins, the Capital wins, the UK Wins and all of us here win.

We have a three-pillar approach to our mission.

1. Partnerships: Our partnership with you our boroughs and local regeneration leads in working together to turn our built environment needs into a pipeline of investable opportunities will be absolutely critical – we have a dedicated team to support this process with capability and capacity building and London Councils are a very important part of this process with us.
2. Proactive Brokerage: We will pro-actively manage the relationship with London’s most important strategic investors from sovereign wealth, institutional, superannuation, ESG and philanthropic funds – setting out the pipeline and seeking a frictionless process to invest. Ultimately what global investors seek is quite simple in a more volatile world: Increased Certainty and Reduced Risk.
3. Promote: We will also promote opportunities for capital deployment by driving a consistent, united and positive London narrative – led my market evidence – to secure investment for you.

As we shape up our £100bn future pipeline, with 100 opportunities across London we will be focussing on six key strategic asset classes right across the capital:

• Logistics
• Life Sciences
• Living (Focus on market products in Student/Retirement/BTR)
• Light Industrial
• Low Carbon Energy
• Leisure & Lifestyle

We will be launching our Opportunity London ‘Investment Prospectus’ in March 2024, firstly here in London and then globally at MIPIM in Cannes, followed by a UK and international roadshow to connect with the international investment community.

This will be a ‘LIVE’ pipeline of opportunities. So, as you, our partners in South London, come forward with schemes and propositions seeking institutional investment, we can promote and seek to broker for and with you.

What excites me most about taking up the helm of Opportunity London is leading a united voice for our great Capital City with our growing cohort of Team London partners.

Our mission is to ‘DO DEALS’ and DEALS that deliver on our core mission which is to attract capital to the Capital, for good. And by good we mean ‘GOOD’ outcomes that will contribute towards a low carbon, equitable and liveable city – shared ambitions for us all.

Like a lot of European cities, historic urban planning in London can accommodate more integrated lifestyles, having long included miles of green open spaces and mixed-use neighbourhoods. The lack of the latter being the reason we are seeing many US cities suffer from increased office vacancies that leave city centres empty. Even in our most concentrated business districts, the changing face of the City, was well underway before 2020.

Our established industries such as financial and professional services along with growth sectors in technology and science makes London a global leader for talent and innovation, and our universities are some of the best in the world (including many here today). We are already, according to a recent report from JLL, the greenest capital city in Europe*. However, with a forward shared vision we can always strive to be even greener, truly innovative and build better for all our communities.

These fundamentals, together with high levels of liquidity and transparency, continuously make London one of the most sought-after destinations for global capital.

In 2022 the UK was the second most traded global real estate market with transaction volumes exceeding £67 billion, with more than £20 billion in cross-border investment into London alone. Our generous relative pricing and a track record of strong price and growth returns is only strengthened by today’s currency advantage on sterling versus the dollar.  Our priority at Opportunity London is directing this appetite to invest towards the areas and assets across our city that need it most across real estate, regeneration, infrastructure, and energy.

The Mayor of London has set a target for London to be Net Zero carbon by 2030. An ambitious target and one shared by the mayors of other great global cities across the C40.

Hands-up colleagues, who are familiar with the work of C40?

I came across C40 a few years ago for a project I was working on in Singapore. They are a global network of mayors of the world’s leading cities from London to Los Angeles, Sydney to Seoul that are united in action to confront the climate crisis – and let’s face it – our cities, our towns and our boroughs are at the sharp end of delivering climate resilient places for our people.

In order to achieve a low carbon planet, we need to phase our fossil fuel dependency and we need capital, at a sizeable scale.

Let me share with you a recent video that set this out from the C40.

Big Numbers – Implementing Climate Solutions can unlock $26 Trillion by 2030, Generate over 50 million green jobs save lives from premature deaths. Certainly, values we share and champion at Opportunity London.

We face huge fiscal challenges, and to ensure the infrastructure we need for the future, international investment – from global pension funds to sovereign wealth funds, insurers and other institutional investors – will be absolutely critical.

The challenge is how we mobilise this investment at scale into opportunities aligned with a resilient future.

Across the globe, there is a growing focus on sustainability. And here in the UK, as you can see from the screen, JLL’s latest Investor Survey results showed that around 80% of participants indicated a greater focus on sustainability, despite the challenging market conditions.

I’ve sat in many Boardrooms with business leaders and often across the table from Ministers, Mayor’s, Local Leaders – all discussing the climate emergency and new forms of place partnership with the public and private sector. It can be confronting and often overwhelming the scale of what we are seeking to collectively address for the generations ahead of us.

I’ve always been a believer though in innovation and entrepreneurship as part of the solution, and often I see the global markets moving faster than nation states and politicians.

I want to share with you some comments from the former Bank of England Governor Mark Carney who is now Special Envoy on Climate Action and Finance for the United Nations.

In a recent interview, he spoke very eloquently about how private finance is increasingly aligned behind achieving Net Zero greenhouse gas emission, where emissions produced equal those removed from the atmosphere. He underlined that people everywhere should keep up the pressure in calling for climate action.

He said in this interview that the goal of Net Zero is the greatest commercial opportunity of our time…. Let me quote from this interview for a moment.

“Climate change is an existential threat. We all recognise that, and there’s increasing urgency around it. But the converse is, if you are making investments, coming up with new technologies, changing the way you do business, all in service of reducing and eliminating that threat, you are creating value. And what we have seen increasingly, spurred initially by the Sustainable Development Goals, accelerated by Paris, and then by social movements and governments, is societies putting tremendous value on achieving net zero. Companies, and those who invest in them and lend to them, and who are part of the solution, will be rewarded. Those who are lagging behind and are still part of the problem will be punished.

“The dialogue has shifted from viewing climate change as a risk, to seeing the opportunity, and really translating that into a single objective, which is to move economies to net zero as quickly as possible. That’s a tremendously exciting development because what we have now in private finance is a focus on a clear goal – Net Zero – and finding the opportunities to advance that and be rewarded by it.”

– Wise words!

And we’re seeing these Net Zero opportunities right here in London. Take for example our office space, with now an estimated demand of 19.2 million square feet for Net Zero carbon office space according to JLL.

So, this is exactly where Opportunity London and our partnership with South London comes into play to unlock and provide those opportunities for institutional capital to invest into our low carbon City.

I often get asked and hear people asking what is the actual cost of preventing climate breakdown.

“As the climate crisis worsens too many people are swinging from denial straight to despair. But, we should not lose hope. Humanity has enormous resources under its command and by applying them wisely we can still prevent ecological cataclysm.”

These are the words of eminent historian Yuval Noah Narari, who if you haven’t watched his Ted Talks, I would really recommend them to every single one of you.

His talks on analysing the work of thousands of scientists and economists across the globe indicate that humanity might avert catastrophe by investing the equivalent of just 2% of global GDP into climate solutions. He makes the case that preventing ecological disasters will not require major global disruptions many fear and explains that we already have the resources we need – it’s just a matter of shifting our priorities.

I spend (and increasingly so) more time with the team, talking to global investors, some of the biggest institutional and individual sources of capital, on behalf of Opportunity London.

According Goldman Sachs, fund flows are continuing to trend favourable for ESG funds as a whole, receiving $579bn between Jan 2019 – August 2022.

Investors such as Blackstone for example, are the world’s largest alternative asset manager, with $1 trillion (YES BIG NUMBER), $1 trillion in assets under management.

They have released a number of funds and initiatives seeking to reduce carbon emission, particularly scope 1 and 2 where they have more control. They are actively searching the globe for investments that align to a Net Zero world. We at Opportunity London want to find them those sites, schemes and borough partnerships to unlock projects that deliver on these aims.

The UK Government set up the Green Investment Bank last decade. A multi-billion-pound bank that was inspired and led other Governments around the world to set up their own equivalents. We led the charge here.

In 2017, it was sold to the private sector, Macquarie Bank from Australia, which was always the UK Government’s plan, which had led to a staggering £26bn committed or arranged of investment in green energy projects, around the world.

It is now known as the Green Investment Group and is a truly remarkable financial solution providing flows of capital across 25 markets and the number one green infrastructure manager, globally. These are exactly the investment partners we want to work with at Opportunity London to release solutions for green infrastructure, logistics and carbon capture across our capital.

Here’s a quick video on the Green Investment Group.

So, my time is almost up.

Let’s unashamedly beat our drum, let’s fly that flag and demonstrate why South London and indeed all of London is THE best place in the world to invest and we are on the up.

If this sounds like a tantalising offer South London, and you share our values and our vision for a green, innovative, low carbon, and prosperous City for all – please come and speak to me or one of our brilliant Opportunity London and London and Partners team members here today.

There has never been a more important time to champion London to the world and you are very much part of our shared mission.

Here’s to our partnership and to London. Thank you.