Property-slump tips from the leisure king

By Candice Krieger, May 23, 2008

Confidence in the property market is at its lowest in more than 30 years, and experts warn that the situation will get worse. But David Coffer, a veteran player in leisure property, is up for the challenge.

With a career spanning more than four decades, Mr Coffer — known in the industry as “Mr Leisure” — is the chairman of Coffer Corporate Leisure, where he has handled over £1bn worth of transactions. He is the former chairman of Earls Court and Olympia, in which he still owns a 10 per cent stake.

Coffer: "Concentrate on excellence of product"

“There is no doubt that, as ever, cash will be king in these markets,” says a relaxed and well-groomed Mr Coffer, 60, talking to JC Business in his Regent’s Park home. “There is a whole swathe of investors waiting for the potential of opportunity to go in and get the bargains. The general consensus is that it is six months off before that happens. The property market has adjusted but we have not got to the level where we can say there are true bargains.

“The recession is an opportunity not just to acquire assets, but also to acquire human resources and to get your act together, prepare for when the recession turns.”

And Mr Coffer is well-positioned to pounce. In February, he launched The Coffer Group, comprising his leisure agency, Davis Coffer Lyons, and the M&A advisory business, Coffer Corporate Leisure, which has advised on more than £2.5bn-worth of transactions. Recent deals include the £70m sale and leaseback of Orchard Care Homes and the £60m sale and leaseback of the Little Chef UK portfolio to Israeli property company Arazim Investments. He also sold Caprice Holdings (The Ivy, Le Caprice and J Sheekey) to rag-trade entrepreneur Richard Caring. Mr Coffer is now preparing to open Coffer Hotels and is eyeing up investment opportunities in New York.

He is also a backer of CG Restaurants (formerly London Brasseries), where his son Daniel is an executive. The company owns several restaurants, including pizza chain Fire and Stone — a concept which Mr Coffer plans to roll out across London. He notes: “We have two other major acquisitions in the pipeline.”

But even “Mr Leisure” himself — a new entry in this year’s Sunday Times Rich List, worth an estimated £170 million — admits the recessionary state of the current property market is worrying, “unprecedented” and potentially “catastrophic”.

“I don’t think I have ever seen the circumstances of a recession of this nature in my career,” says Mr Coffer, who has been holding a series of property dinners for clients and friends.  “We have never had so many variations of so many capital markets in the world, which are so quick to react. There has never been a market where the media has had such a part to play in conveying it all and there has never been a market in the last 20 years where there has been such liquidity from the banks — which are now very precious about lending.

“I’ve never seen a recession so far-reaching in major parts of the world. The impact of the interfacing of these markets could be catastrophic. We also haven’t yet seen the banks offering propositions to trusted cash-rich clients, whereby they clean up their balance sheets. And that has happened in all of the last recessions. But that moment will come no doubt.

He observes: “Many sectors are in denial and there is worse to come at the banking sector. There is certainly worse to come out the property sector. The whole thing is one enormous escalation of recession.”

Yet the veteran is resilient: “Part of the group has been hurt but I have consolidated and am ready for opportunities. One has to concentrate on excellence of product to an increasingly price-conscious public. Keep your own counsel, deal with what you know and know for certain that it will change,” advises Mr Coffer, who has survived four recessions.

He grew up in the East End, leaving school at age 16. He started his career at a North London estate agency but fed up with, as he puts it, “showing bored Jewish housewives semi-detached houses in Hampstead Garden Suburb”, he joined retail agency Dudley Samuel and Harrison. Dudley Samuel was the uncle of John Ritblat, now Sir John.  “He [Dudley Samuel] took me under his wing and taught me a lot about retail,” recalls Mr Coffer, who did his first deal — the sale of a site in Kentish Town for £40,000 profit— at aged 19. But told he could not have 10 per cent, just the equivalent of the agency fee — about £80 — he “walked out and told him where to stick his cheque.”

His first big break came in 1972, when he formed Davis Coffer Associates, together with Lewis Davis. The pair won a £6,000-a-year mandate from Pizzaland to implement the concept. By 1980, there were more than 200 Pizzalands and Mr Coffer has specialised in leisure ever since. Davis Coffer was later renamed Davis Coffer Lyons, when Anthony Lyons (now CEO of Earls Court and Olympia) joined the firm. They bought Earls Court and Olympia in 2004 for £245m. Asked if Chelsea football club owner Abramovich ever inquired about buying the site for the club, he confesses: “His representatives came to look round, but nothing ever really happened.”

But the Earls Court and Olympia deal was not his most notable transaction. That, he says, was “the acquisition of a Max Liebermann painting, which is now worth about 30 times more than I bought it for.”

A keen art and glass collector, Mr Coffer owns a 29-piece Lalique collection of car mascots and seven paintings by British artist Adam Dant. Other extravagances include owning eight cars and homes in Florida and Spain. Last October, he hired jazz musician Jamie Cullum to play at his 60th birthday bash.

A devoted charity fundraiser, Mr Coffer, supports a variety of Jewish and non-Jewish causes, both in the UK and overseas, through his Coffer Foundation. Other passions include his partnership in Matt Roberts’ Personal Training empire, which recently acquired the Jack Straw’s Castle site in Hampstead.

How does he feel about being on the Rich List? “It’s all bollocks. How do they know what I’m worth? The real money is in the bank. It’s not assets —  they can go down the pan.”

Married to Ruth, the couple have three children and five grandchildren and are members of Western Marble Arch Synagogue in London’s West End.

Last updated: 11:52am, August 19 2008