Knight Frank payouts fall as profits dip
ESTATE agent Knight Frank yesterday insisted it was looking ahead to a “period of stability” after revealing a near 50 per cent fall in full-year pre-tax profits.
The group, which advised on Nomura’s move to Watermark Place – the City’s biggest property deal this year – revealed underlying group profits had fallen to £33.2m in the year ending 30 April 2009, down from £67m the year before.
Chairman and senior partner Nick Thomlinson told City A.M: “To say the last 12 months have been difficult is an understatement. But we reacted quickly to the problems and took a lot of the fat out of the cost base.”
Despite the economic turmoil crippling the property market in the downturn the group managed to maintain net assets of £58.3m, down from the £76.2m the year before, and remains debt free with £28.5m net cash in the bank, down from £53.9m.
Last year the group came under fire for awarding an average payout of £780,000 per partner, despite the market slump. In the boom times Knight Frank’s partners enjoyed awards of over £1m.
But in the strongest indication of how property agencies have fared in the downturn, the group said the average pay out per proprietary partner had dropped to £169,000.
Thomlinson said: “It’s absolutely right that partners bear the brunt of the downturn.” He added that the fall in profits and the increase in the number of partners from 46 to 61 also meant pay outs were divided between more people.
The group issued a cautious outlook on the commercial property sector, warning that it could take until 2012 for rents to rise again. It added that house prices “are starting to bottom out across the world”.