Michael Docker, founder and managing director of Gracewood Group, talks about his career spanning finance and property, while more recently breaking into airspace developments.
Please tell us briefly about your current role.
I oversee all the business, from our construction division, to our PRS management company, Estates & Lets.
We are currently developing a pioneering rooftop development in Mile End, in East London as well as working across several projects in London and Essex.
Our rooftop development division and the work that we do with Housing Associations is growing and I am overseeing that part of the business as well as all the financials. Originally, I worked in the City, so my background is in finance, the markets and risk management.
Why did you move from finance into the property industry?
I started investing in property in 1996. At that time, I was a money broker. My career as a broker spanned 20 years and I had seen the good days of the 1980s but unfortunately, the money market started to become automated and the banks brought in the electronic broking system. Our trading market share dropped from 80% to 10% almost overnight. The writing was on the wall for my career in the City, and I made the decision to leave in 1999. By that time, I had started to build a property portfolio.
What was the starting point for your career in construction?
I did a deal on a reasonable size block of 25 units, opposite our current office. This was the confidence boost that I needed to set me on my new path. After that first successful deal we started getting interest from agents and investors, which gave me a springboard into the off-plan markets. This was a strong market for the next 10 years, until the credit crunch in 2009. Luckily, I was able to complete my last off-plan deal of 88 units in Canary Wharf before the credit crunch and finance markets disappeared.
From around 2010 until 2015, I built a considerable amount of units from pubs and a few other sites that I had acquired. I was always looking at ways to build up the portfolio so when the prices of pubs got too high and that market ran out of steam, we moved into developing unused office space, working on Permitted Developments. We purchased a former office space in Romford, Essex and turned it into 90 homes and then bought an office in Ilford that we sold on with the benefit of planning permission for 104 homes.
I have been very fortunate in that I have been in the right place, at the right time when it came to the different property markets and locations I chose developments in. For example, I started to invest in Canary Wharf when it first started to grow and then built in robust surrounding areas, later following the Crossrail route.
Our work with housing associations began when one of our pubs that we were developing backed on to land owned by a local housing association.
What made you decide to move into airspace developing?
Rooftop development lends itself to certain sites. We were working with a housing association that was looking for opportunities, so we suggested to appraise one of their estates looking at some infill and other potential opportunities. It became apparent that the best solution on this estate was rooftop development – all credit to the housing association for giving us the instruction to move it forward!
Housing associations need to provide more homes but do not want to decant their residents. We came up with a solution to use the existing building to gain density without the need for disruption and decant.
We have worked on several rooftop developments over the years and have just started work on one of, if not the largest rooftop development ever to be consented in the UK with EastEnd Homes in Mile End. It will provide 142 new homes on the Eric Estate including studio, one-, two- and three-bedroom apartments that will sit two-storeys high, atop five existing low-rise apartment blocks. We are also building a further 11 homes in a former garage space. Another great part of this development is that almost 80% of the homes will be delivered for affordable rent and intermediate home opportunities. We are keen to emphasise that rooftop development can maximise space in the capital and make a real contribution to housing supply.
When you are attaching old to new there can be many challenges, so you need developers with experience of the build and who are good at finding solutions to the problems that could arise throughout the process.
What sort of skilled roles have you needed to fill as your company has expanded?
Our industry experts have a wealth of experience. From land specialists, technical experts, and an in-house construction team we can deliver challenging projects with efficiency and minimal disruption. Expanding our in-house construction and architectural planning teams has been crucial to our success.
We have most recently taken on a commercial director from a national housebuilder, who is now our managing director of Gracewood Construction.
Has the diversity and quality of job candidates changed much over the years?
It is well documented that our sector is significantly behind other industries when it comes to diversity. Historically, it has been male dominated, with entrants joining straight from school and working their way up. But this has changed dramatically in recent years. Many of those that join us come from further education colleges and university where there is now greater diversity on the courses, which is leading to greater diversity in the workplace.
Are there still personal achievements you are aiming for, even with the success of your business?
Over the next five years we want to further progress our PRS portfolio. We are also looking to grow our joint ventures with housing associations and local authorities using our rooftop expertise to help develop key homes for Londoners. We truly want to change the way housing associations and landowners can maximise space across the capital where space is at a premium.
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