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About Grosvenor Hill Ventures

Grosvenor Hill Ventures is the investment arm of real estate firm Savills.

Grosvenor Hill Ventures Headquarter Location

33 Margaret Street

London, England,

United Kingdom

+44 (0) 20 3107 5420

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Latest Grosvenor Hill Ventures News

Savills : Preliminary Results Report for the year ended 31 December 2021

Mar 10, 2022

03/10/2022 | 03:23am EST Message : RECORD REVENUE AND PROFITS RESULTING FROM EXTRAORDINARILY STRONG TRADING RECOVERY. Savills plc, the international real estate advisor, today announces its preliminary results for the year ended 31 December 2021. Key financial highlights Underlying* profit before tax up 107% to £200.3m (2020: £96.6m) Reported profit before tax up 120% to £183.1m (2020: £83.2m) Reported basic earnings per share ('EPS') up 114% to 104.9p (2020: 49.0p) Aggregate dividend of 55.4p to be paid in May 2022, includes a one-time special dividend of 27.05p Net cash** £340.7m (2020: £177.7m) Underlying profit before tax ('underlying profit') is calculated on a consistently reported basis in accordance with Note 3 to this Preliminary Statement. Net cash reflects cash and cash equivalents net of borrowings and overdrafts in the notional pooling arrangement (see Note 8). Key operating highlights 2020's strategy of maintaining full operating strength and high levels of client service positioned the Group well for the progressive recovery in 2021. Transactional Advisory revenues up 34% in recovering markets; Commercial Transaction revenue increased 35% overall with strong growth in the UK and Asia Pacific. Residential Transaction revenue up 31%. Less transactional businesses, in aggregate 58% of Group revenue, continue to perform well with revenue up 17%. Property and Facilities Management revenue up 9%, Consultancy revenue up 24%. Savills Investment Management revenue up, driven by base management fees growth of 30%. Assets under Management ('AUM') up 22% at €25.8bn. The Group entered a significant strategic partnership between Savills Investment Management and Samsung Life Insurance ('SLI') to accelerate the future growth of the Savills Investment Management business. Continued investment in people, technology leadership and innovation in sustainability including the launch of Savills Earth consultancy services. Commenting on the results, Mark Ridley, Group Chief Executive, said: "Savills delivered a record performance in 2021 reflecting the significant recovery in both residential and commercial transactional markets supported by growth in our less transactional Investment Management, Property Management and Consultancy businesses. The war in Ukraine has shocked the world and, in response, Savills is providing support both through international charities and via our Polish operation, focussing particularly on Ukrainian refugees. Our thoughts are with everyone affected in the region and we can only hope for a peaceful resolution as quickly as possible. At this stage it is too early to predict the economic, including longer term inflationary, impact of the Ukrainian crisis on the world's real estate markets. Subject to this key uncertainty, we would anticipate real estate transaction volumes and discretionary spend to normalise in the year ahead, alongside the continued recovery of global markets as they emerge from pandemic-related disruptions. The Group has started 2022 in line with our expectations and the strength of our balance sheet supports our growth strategy to pursue further complementary acquisitions and significant recruitment across our global business." The analyst presentation will be held at 9.30am today by webinar. For joining instructions please contact nrichards@savills.com. A recording of the presentation will be available from noon at www.ir.savills.com . For further information, contact: Simon Shaw, Group Chief Financial Officer Tulchan Communications Chairman's statement Results The Group's revenue increased by 23% to £2.15bn (2020: £1.74bn), with strong trading in the last quarter of the year led by the UK and Asia Pacific regions. Both Continental Europe and the Middle East ('CEME') and North American regions recovered to reverse 2020's losses delivering better than expected profits for 2021. With more than half of the revenue growth from the Transaction Advisory business, and reduced levels of discretionary expenditure, underlying profit for the year substantially increased by 107% to £200.3m (2020: £96.6m), reflecting a margin of 9.3% (2020: 5.6%). The Group's reported profit before tax increased by 120% to £183.1m (2020: £83.2m). Overview Savills delivered a record revenue and profit performance in 2021, reflecting both the robustness and geographic diversity of our business and the strategy of maintaining staffing levels throughout the course of the pandemic. Overall, our Transaction Advisory revenue increased 34%, our less transactional businesses of Consultancy and Property Management grew revenue by 24% and 9% respectively. The UK Residential Transaction Advisory business delivered a record performance with a revenue increase of 38%. Despite the backdrop of pandemic-related uncertainty in 2021, the UK performed exceptionally well across all business lines. There were notably strong performances from the Transactional Business lines, albeit Commercial office leasing volumes remained below historic averages in the majority of markets. Savills strengths in both logistics and retail warehousing, both of which enjoyed significant volume increases year-on-year, also contributed to our overall outperformance. The UK prime residential market continued to perform extremely strongly and volumes in the Prime Central London market clearly began to improve through the last quarter of the year. In Asia Pacific, the business as a whole had a good finish to the year. Hong Kong sales activity and market share were strong and Australia, Singapore and Japan also enjoyed strong trading activity in the final quarter. In both CEME and North America the increase in transaction volumes resulted in profits in both regions for the year. Commercial Transaction revenues increased 27% and 28% year-on-year in CEME and North America respectively. Savills Investment Management outperformed expectations, as a result of new fund launches and strong investment performance from the majority of our products, together with the benefit of the acquisition of DRC Capital LLC ('DRC') from the end of May in attractive markets for real estate debt investment. Capital raising and deployment were robust following the cautious approach adopted across the markets during the pandemic. A number of new funds successfully launched during the year and Assets Under Management ('AUM') increased 22% to €25.8bn (2020: €21.1bn). The increase in transaction volumes, alongside substantially lower levels of discretionary expenditure (travel, entertainment and marketing events all remained severely curtailed), resulted in an increase to the Group underlying profit margin to 9.3% (2020: 5.6%). The impact of the above factors on the Group underlying profit margin delivered an increase in reported profit before tax of 120% to £183.1m, representing an 8.5% reported pre-tax profit margin (2020: 4.8%). Currency movements in the year decreased revenue by £49.8m, underlying profit by £4.1m and reported profit before taxation by £3.2m. Impact of COVID-19 and war in Ukraine The real estate sector has shown resilience in the face of the pandemic. Global real estate investment volumes substantially recovered during the year, with volumes 59% higher than 2020. Office investment remains below pre- pandemic levels, however volumes in the highly sought-after industrial sector were up 61% on 2019 levels. Residential became the largest sector for investment globally during 2021, with investors attracted to its secure, income generating qualities. Globally, office leasing volumes have been the slowest transactional segment to recover as Corporate Occupiers assess both return to work strategies for their staff and, increasingly, the Environmental, Social and Governance ('ESG') impact of their leasehold estates. The UK housing market performed strongly in 2021, delivering double digit house price growth and the highest level of transactional activity since 2007. The prime housing markets performed particularly strongly with activity levels remaining buoyant even after the end of an extended stamp duty holiday, despite reduced levels of publicly marketed stock during the second half of the year. Prime transactions were more heavily weighted to the markets beyond London, as buyers continued to reassess their housing needs in the search for space. In the Asia-Pacific region, investors were resilient in the face of varied pandemic-related restrictions and geopolitical concerns in 2021 with an estimated 30% rise in volumes compared with 2020. In many countries which experienced significant lockdowns, real estate markets appear to have learned how to manage on a "business as usual" basis. In Europe, there was also a strong rebound in European commercial and residential investment volumes in 2021 despite the ongoing pandemic-related disruptions. European investment volumes reached an apex during the final quarter of 2021, marking a 25% jump in volumes on the past 5-year average. In North America, corporate office leasing markets improved during the period, which became increasingly apparent in the last quarter of 2021. The tech and life science sector continues to lead demand as the five prominent American tech giants expanded in key talent hubs with buildings that will incentivise in-office employee collaboration and satisfaction, even as hybrid work policies remained largely in force. Demand for industrial space also continued at a record pace and average vacancy has reduced to 4.5% across the US. It is too early to predict the impact of the crisis in Ukraine on the world's real estate markets. Savills derives immaterial revenues (<0.1%) from clients of Russian origin and we have suspended our long- standing franchise relationship with an agency in Moscow. The Group does not have operations in Ukraine. Sustainability in real estate Decarbonising the real estate sector is an urgent and pressing need; a challenge that COP26 highlighted. Consequently, ESG considerations are increasingly defining both investor and occupier decisions. In Europe, ESG is already actively shaping the assets and geographies in demand, a trend set to spread globally over coming periods. Throughout the period, Savills engaged our in-house sustainability expertise to audit the Group's footprint and recommend the strategy for progressing to net Zero. The 2021 Annual Report contains the Group's first report under the Task Force on Climate- Related Financial Disclosures ('TCFD') framework. In summary, we have achieved significant reductions in Scope 1 and 2 CO2 emissions since 2016, which represented 6,738 tonnes CO2e in 2021. We are committing to Science-Based Targets to deliver our goals, consistent with a no greater than 1.5°C temperature increase, of achieving Scope 1 and 2 net zero by 2030 and net zero in our value chain (i.e. Scope 3, including assets under the Group's control) by 2040. Business development Savills strategy is to be a leading multi-sector property advisor in the key markets in which we operate. Our global strategy is delivered locally by our experts on the ground with flexibility to adapt quickly to changes in circumstances and opportunities. They are supported by our global cross-border investment, residential and occupier services specialists. Over the last few years we have acquired a number of complementary businesses and added teams and individual hires to our strong core business. During the pandemic, the Group has continued to focus on strategic development of the business, which has been enabled by the Group's strong balance sheet. In the first half of the year, Savills Investment Management completed the accelerated acquisition of the outstanding 75% of DRC Capital (a related party), the specialist European Real Estate Debt Investment Manager. In December 2021, the Group entered a significant strategic partnership between Savills Investment Management and Samsung Life Insurance ('SLI') to accelerate the future growth of the Savills Investment Management business. The Group sold an initial 25% stake in the Savills Investment Management business to SLI for consideration of £71.7m (of which £63.7m was received on completion). SLI, in turn, is committed to investing in excess of US$1bn into Savills Investment Management products over the initial five year term of the relationship. Earlier in the year, the Group acquired T3 Advisors, a leading Real Estate advisor in the Life Science and Technology sectors in North America. In Q4 we enhanced our Asia Pacific project management and real estate consulting capabilities through the acquisition of 60% of the Merx Group of companies headquartered in Singapore. The Group also further strengthened our market leading position in Spain by acquiring a largely retail property management business. Since the end of the year, the Group has also entered into a business venture with leading Berlin-based real estate agent Thomas Zabel as part of our expansion strategy in the European residential market. In addition to the acquisitive growth in our business, we continue to undertake organic growth initiatives across the platform, with significant recruitment across all our regions, with particular focus on North America, Greater China and CEME. Focus on technology Technology continues to be an important focus for the Group, and we benefit from the investments we have made both internally and externally, through Grosvenor Hill Ventures (our technology investment subsidiary). Across the Group data-led insight continues to help us solve many of the most complex real estate challenges our clients face. While markets around the world are at different phases of data transparency, our regional centres of excellence closely aligned to client facing teams help match real estate understanding with data expertise. In the summer our award-winning Knowledge Cubed platform underwent a significant upgrade with the launch of a host of new "apps" to help corporate occupiers manage their real estate interests. In the UK auction market, we have continued to take market share by utilising our bespoke live-stream auctioning platform, and off this success have further expanded our commercial auction offering. As employees return to offices across the world, there is an increasing focus on tenant experience with landlord clients and their customers increasingly looking to deploy technology that reduces day-to-day points of friction. We've observed an evolution from the pre-pandemic objective of "community building" particularly within the multi-tenant office environment to platforms that genuinely improve the occupational experience. Post year-end we completed the acquisition of one such platform "Cureoscity" which is currently being rolled out to our UK Property Management clients to enhance tenant security and experience. Our technology-enabled flexible office brokerage Workthere capitalised on the increased demand for flexible workspace across the globe. It delivered a very strong end to the year and has a good pipeline for 2022, with particularly strong performances from the UK, US, Netherlands and France. During the year we led a funding round into Income Analytics through Grosvenor Hill Ventures, alongside MSCI. This exciting business is a data technology firm which provides investors with proprietary global rental default risk measures on commercial real estate income at tenant, asset, fund and portfolio levels. Board As previously announced, in January 2021 Philip Lee and Richard Orders joined the Board as Non-Executive Directors. Rupert Robson retired from the Board at the Annual General Meeting in May 2021 and Tim Freshwater retired from the Board on 31 December 2021. I thank them both for their enormous contribution to the Board over the years and Tim in particular for his valuable counsel latterly as Senior Independent Director. Dividends A final ordinary dividend of 12.75p is recommended by the Board (2020: 17.0p), alongside a supplemental interim dividend of 15.6p (2020: nil). In addition, in view of the Group's very strong recovery and cash generation since the lockdowns of 2020, the Board is also proposing a one-time special dividend of 27.05p being similar to the 2019 final ordinary and supplementary dividends which were cancelled as COVID-19 took hold in March 2020. The aggregate dividend of 55.4p will, subject to Shareholder approval for the recommended final dividend at the AGM on 11 May 2022, be paid on 17 May 2022 to Shareholders on the register at 8 April 2022. The total paid and recommended ordinary, supplemental and special dividend for the 2021 financial year comprises an aggregate distribution of 61.4p (2020: 17.0p). People The strength of our recovery is an absolute testament to the commitment of our entire global workforce and I would like to express my thanks to all our staff worldwide for their hard work, their flexible approach during challenging times and relentless commitment to client service. Summary and Outlook Savills delivered a record performance in 2021 despite the backdrop of pandemic-related uncertainty in the year. This was a result of our strategy to maintain full operating strength and high levels of client service through the pandemic, enabling the Group to successfully service clients into the progressive recovery of many markets in which we operate. Our balance sheet remains strong and we continue to focus on developing our global businesses through the coming periods through acquisitions and organic growth. The war in Ukraine has shocked the world and, in response, Savills is providing support both through international charities and via our Polish operation, focussing particularly on Ukrainian refugees. Our thoughts are with everyone affected in the region and we can only hope for resolution as quickly as possible. Attachments

Grosvenor Hill Ventures Investments

3 Investments

Grosvenor Hill Ventures has made 3 investments. Their latest investment was in YOPA as part of their Series E on November 11, 2021.

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Grosvenor Hill Ventures Investments Activity

investments chart

Date

Round

Company

Amount

New?

Co-Investors

Sources

11/30/2021

Series E

YOPA

No

1

5/16/2017

Series B

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$99M

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10

6/3/2016

Series A

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$99M

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10

Date

11/30/2021

5/16/2017

6/3/2016

Round

Series E

Series B

Series A

Company

YOPA

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Amount

$99M

$99M

New?

No

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Co-Investors

Sources

1

10

10

Grosvenor Hill Ventures Acquisitions

2 Acquisitions

Grosvenor Hill Ventures acquired 2 companies. Their latest acquisition was Cureoscity on February 07, 2022.

Date

Investment Stage

Companies

Valuation
Valuations are submitted by companies, mined from state filings or news, provided by VentureSource, or based on a comparables valuation model.

Total Funding

Note

Sources

2/7/2022

$99M

Acquired

1

2/3/2022

Seed / Angel

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$99M

$99M

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10

Date

2/7/2022

2/3/2022

Investment Stage

Seed / Angel

Companies

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Valuation

$99M

$99M

Total Funding

$99M

Note

Acquired

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Sources

1

10

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