Copyright: David Lawson – first appeared Property Week August 1999Home page
The first question is always the same. 'Are you related?' Anton Bilton was hardly out of his teens before he felt like changing his name. Most people might welcome being part of a dynasty. Ask the Ritblat boys or Tony Pidgley whether doors open easier when your father is a property industry giant. Anton is a generation further on, grandson to Percy Bilton, who founded one of the country's biggest construction and property companies. But it has been more a burden than a benefit.
Only as his own company, Raven Group, takes off, is he shaking off what had become a stigma. Bilton's father, Godfrey, has emerged as the mystery buyer with Morgan Grenfell of Pillar's 78m office portfolio. Raven will manage the buildings, which Bilton says have 'outstanding reversionary potential.' It also has a stake in 220m pound plans reported this month for a massive extension of the Howard Johnson hotels chain.
Bilton has built a strong team including financial director Bim Sandhu, formerly of KPMG and a director of Courage Pubs. A prize catch was property heavyweight Nick Sheehan, who joined last year as a retained consultant. 'He says it reminds him of he excitement in early days at LET when anything seemed possible,' says Bilton.
For decades, Bilton was a byword in the City for old-fashioned, stuffy conservatism. This was the antithesis of Raven, a vibrant entrepreneur venturing into fields ranging through housebuilding, hotels, retail warehousing, listed building conversion, golf courses and Internet connection.
The shadow lifted after the bitter takeover battle won by Slough Estates. It should all have happened years ago, according to Anton. 'I looked at a bid in 1990 but the market was wrong. I must have been called once a month since then by insiders begging me to do something,' he says.
Others had tried: more than one senior property figure was manhandled from the Bilton HQ after having the temerity to drop in and make an offer. Ironically, Anton had little connection with the family company. He spent only a month there in his teens, around the time his grandfather died. 'I was carrying paving samples to County Hall. I quickly realised this was not for me,' he says.
He had different ambitions after studying banking and finance at university. The gap grew wider when his father left five years after the 1972 float and both sold their shares. Relations with Ron Groom, who took over after Percy Bilton died, were also fraught. 'We did not get on,' admits Anton, leaving an impression that he could say a lot more about a man he had known since a child and taught him the company tradition of shooting. 'I will never understand why he didn't make a bid himself,' he says. 'It could have won and saved a lot of infighting.'
Anton did not ignore the Bilton property gene, however, converting houses until the Eighties crash. He admits he survived more by good fortune than judgement: 'Don't believe anyone who said they saw it coming and sold out in 89. Only the lucky survived,' he says. For once, the family connection came in useful. His father drew on a lifetime in property for one terse piece of advice that has driven Raven ever since: 'Don't specialise. Look for value everywhere.'
Anton started by sifting the wreckage of the crash held by banks. He found a former Mountleigh site at Staines, switched the B1 permission to retail warehousing and sold to Land Securities after achieving one of the highest rents in the sector. It was not a simple task. 'In fact it was bloody hard work. There were 14 other owners with an interest in the site to sort out,' he says.
But it set the pattern for what became the Raven Group, which reached an annual turnover of around 30m pounds before the Pillar purchase shifted the company into a new gear. Everyone in the small team works long hours looking for value wherever they can find it. That has spread Bilton across a wide range of activities. Raven became a leading specialist in converting listed buildings after he realised that planners would welcome new housing in the grounds of former hospitals if he promised to retain and renovate the relics. Seven have been converted since 1993 and volume builders now queue to use Raven as partner.
The residential business will be spun off once market conditions are right. Bilton will not bow out completely but says it runs OK without his hand on the tiller and the money released by a float or trade sale can be better used elsewhere. He is not put off by institutional disenchantment with small property companies. 'They'll come back,' he says. 'They have to when they realise they can't get double-digit growth from blue-chip companies.'
Raven's newest chapter involves unlocking value in provincial offices. Just as Bilton saw a new use for old hospitals, he has taken the eclectic view of converting obsolete commercial buildings into budget hotels. Again, planners are likely allies, as they welcome job-creating schemes rather that conversion to homes. Western Plaza, a former BT office building in West Bromwich is a classic example: 160,000 sq ft of boom-style offices in the wrong place for re-letting but ripe for a market starved of beds for cost-conscious business travellers. A 40,000 sq ft Edinburgh warehouse scheme was bought for 3.5m and sold for 6.5m pounds to Scottish metropolitan two years ago.
Four listed buildings near Trafalgar Square were bought from an institution for 4.6m and are being sold after conversion to flats and a pub for 9.25m pounds. NPI is buying the pub which is let to Scottish and Newcastle. A 40,000 sq ft former council block in Nottingham is also planned for conversion to a 140-bed hotel. One hostel on Kennington, London, has already been converted and sold to Premier Hotels.
Raven has a valuable advantage in this market with a 25% stake in the UK franchise for Howard Johnson and Days Inn hotels. It comes via a loan note in a subsidiary of franchise owner Premier Hotels, which is reported to be seeking 220m pounds of venture capital to create 5,000 hotel rooms across the UK. 'This sector is set for enormous growth,' says Bilton. 'It is not just that there are more travellers. Businesses are cutting costs but they don't want to drop down the scale to low-quality small hotels. In the US you know there will be a HoJo with clean sheets and a TV in every town, so why not here?'
True to his father's advice, Bilton has other strings to his bow. A neighbourhood retail development in Bolton will be worth 10m pounds if planners give the go-ahead. The former HMV/Burton stores on Union Street, Glasgow, were bought and sold, leaving space for a health club worth 8m pounds. Leisure is a major interest: Raven has stakes in restaurants, golf courses and Poole Stadium, Dorset.
The biggest scheme on the books is Wardour Street car park in London's Soho, bought from Cendant for 10.5m pounds. Plans have been drawn and redrawn to end up with 8,165 sq metres (87,900 sq ft) of offices and homes worth 28m pounds. He won the off-market deal because he was known inside NCP, which was bought by Cendant. Raven's name rather than Bilton fame tipped the balance, however.
'We have built a reputation of working hard and playing straight,' says Anton. It could be a legacy which makes the next generation of Biltons happier to associate with their dynasty.