Loudon clear

Loudon clear

Few people understand Edinburgh’s property market as intimately as Richard Loudon, the head of Simpson & Marwick’s award-winning property team. Kenny Kemp meets him.

The best-selling author Alexander McCall Smith populates his every-day stories with colourful characters from Edinburgh’s New Town. There would be little surprise if one was based on Richard Loudon. He is an energetic fifty-something Edinburgh solicitor with impeccable manners, an air of confidence and a real passion for his home city.

That confidence could be something to do with his success in building the upmarket residential property business of law firm Simpson & Marwick over the last 31 years. Each day he still heads out to visit properties, adding another few pages to his encyclopaedic knowledge of the city. Richard Loudon could well have trampled a very different career path.

The son of a notable Scottish medical family – his father John was a senior consultant obstetrician at Edinburgh’s Eastern General Hospital, while his Highland mother, Nancy, was a pioneer of family planning in Scotland – he might have been impregnated with the medical gene. Then, in his last year at the Edinburgh Academy, he undertook an aptitude test which indicated he had all the attributes to become an architect, a path later chosen by his younger daughter. (Loudon’s son and elder daughter have followed their father and mother into law and medicine.) Instead, Richard headed off to Sheffield University to study business studies, ended up with a law degree and then attended the College of Law in Guildford.

He spent some of his probationary period at Masons in Fleet Street but the lure of London, the proximity of the law courts and the Inns of Court didn’t really inspire. Instead a young Richard Loudon headed back to Edinburgh. This was in the early days of Thatcher’s Britain with three million unemployed, a radical era of privatisation in the air, and getting a start was not normally easy. But, on September 4 1979, he joined Simpson & Marwick, then a small but venerable legal firm in 18 Heriot Row, next door to where Edinburgh’s most celebrated literary son, RL Stevenson, once lived.

“I knew Douglas Moodie, the conveyancing partner at the time, and he offered me an apprenticeship over the phone. So I’ve never actually really had a job interview,” he recalls with a laugh. He was coming home for good.

“Edinburgh is one of the most beautiful cities in the world. The Georgian legacy of the New Town is unique. The most incredible thing is that you can actually live on the principal streets of a capital city. There is the New Town and lots of very good residential areas within easy walking distance to the city centre, from Stockbridge, Inverleith and Murrayfield and, on the south side, there are larger properties in the leafy suburbs of Greenhill, Grange and Morningside, all within easy reach of the shops, restaurants and bars.” Simpson & Marwick were known as specialists in litigation. Even today there are 26 partners in litigation and only three other is property – Loudon, Brian Smith in Edinburgh and David Geddie in the Aberdeen office. Residential property was seen as a service for clients but hardly the main activity for an ambitious legal firm.

From early days, Loudon’s vision was to see that the property department became a worthy complement to those heavyweight litigators. Today he is regarded as one of the foremost residential property lawyers in Scotland with his team recognised as both Property and Conveyancing Firms of the Year in the 2010 Legal Awards. Of course, there are plenty of successful residential property lawyers in the capital who have enjoyed a very decent standard of living in the past 30 years, but Loudon has remained the one to beat. One Edinburgh contemporary, in the same field, described him as a tough but scrupulously fair competitor.

“He has a real belief in his ability and knowledge,” he says. “Some might call it conceit, but I don’t think that’s fair. In Richard’s case it’s based on a reflection of how he has built up Simpson & Marwick.” Perhaps it’s something about his own competitive streak which goes back to playing squash, cricket and rugby, or his current passion for golfing at the glorious Renaissance Club in East Lothian, but Loudon has turned Simpson & Marwick into a leader.

He says: “I’ve played a lot of team sport over the years. The success here is down to the great team we have. Yes, the captain should lead by example and that’s what I see myself as doing, but it’s the team players that really matter here. They all do a fabulous job.” He was a litigation apprentice under Evan Weir. He recalls parking his boss’s car, buying his Capstans, and early evenings spent licking stamps onto letters by candlelight. Perhaps the office might have benefited from Leerie the gas lamplighter – immortalised by RLS – passing by during those power cuts in the late 1970s.

Richard recalls that the photocopying room still retained the then-unused wet photocopying trays, where each sheet would have been hung up to dry with clothes pegs before being sent to the appropriate department. Yet, Loudon was one of a cohort of lawyers made a partner at the tender age of 25. “It was a time of great growth in law and we were made partners at a young age,” he says. “At that stage, I was the eighth partner.

One retired in the 1980s but there were still seven of us together in business 27 years later, until last year.” In the late 1980s, as Edinburgh’s property market began to heat up, some solicitors were discounting conveyancing fees to gain market share, which made others question the future viability of property work. “We had the choice of doing two things – improve the quality and standards of service, raising the cross-bar, or else compete on fees,” says Loudon.

“We felt the best way of going was to build a high quality estate agency and conveyancing service.” It was a snowball effect. The firm began to use For Sale boards – new in Edinburgh – and, with properties to sell, this began to attract attention.

“If the properties look good and are well presented, then sellers will come to you,” he says. “The more inquiries you get, the more properties you have, the more you can build the business.” At that time in order to sell a house you typed-up a single sheet of foolscap which was delivered to the old ESPC (Edinburgh Solicitors’ Property Centre) office in George Street which they then presented to the public in a ringbinder.

That was all you did. There were no For-Sale boards or photographs; “marketing” was an expensive advert in The Scotsman on a Thursday. The marketing of property was being transformed.Innovation in conveyancing and property was a driver for Loudon, who sees himself as increasingly entrepreneurial in his field. In 2006, he was one of five forward looking lawyers who were instrumental in the introduction of standard missive clauses, now used in probably over 95% of property transactions.

“It proves you can make things work with others to improve the process to the benefit of all involved,” he says. The influential Edinburgh Conveyancers Forum was created as a result of the success of the Standard Clauses.

“I like to think that what I’ve done is grow a business here, which is very different from dayto- day law. Seldom do I look at any statutes, cases or even textbooks.” Simpson & Marwick’s property department, under Loudon’s watch, remain ahead of the curve, recently adopting iPads to display their marketing package when pitching for business. Using QR codes, a kind of next generation barcode which allows a smart phone to take an interested party right through to an internet page without a search.

Then – using a Propcast as an option – the interested buyer can walk virtually through the home as a voice describes each room. “I’m pleased that we’ve always embraced technology to help people sell their homes,” he says, as he flicks his pointing finger across the tablet computer.

“In the early days, I had to twist my partners’ arms to let me buy a word processor. It’s an indication of keeping ahead of the game, which we’ve always tried to do. I think we were the first Edinburgh firm to have a property website – edinburghprimeproperty.com. We are now on Version Four and constantly refining it.

“Even at the start I didn’t want to call it simpsonandmarwick.com because the firm was so well known as a litigation firm. And, in early days, people searching on the internet would have been more likely to click on a search result ‘Edinburgh Prime Property’ than one of 200 law firm names.” “Ten years ago, a lot of marketing people said there were dangers in dual branding, yet edinburghprimeproperty.com is one of the top two or three results on a Google search for Edinburgh Property. We’re also just about to launch our own mobile website. I believe the brand is now well recognised in Edinburgh along with ESPC, number one on that Google search.

I can never understand why anybody would market a property using an agent that cannot advertise the property on espc.com.” So what has been the fall-out from the recent recession? “In the early 1980s most Edinburgh properties were bought by people born and brought up in Edinburgh. Since then, there has been a steady influx of people from the rest of the UK and abroad.

The impact of the finance houses, the banks and fund managers meant there were very many more people coming and going. Edinburgh and East Lothian have done extremely well.” There are now an international set of people who choose to live and raise their families in Edinburgh when they are working elsewhere, perhaps in London or regularly overseas in Frankfurt or even New York.

“Then, in the 1990s, a lot of people moved here because the education system was so good and the property was comparatively reasonably priced,” says Loudon.

“All these subtle things influence a decision to live in Edinburgh.” The highs of 2007 – which was a record year for S&M property – and the lows of 2008 and 2009 have an indelible impact on Simpson & Marwick, now based in a modern office on Albany Street.

Last year was about a slow recovery, up 51% from the previous year, while there is an expectation of a flourish during the spring of 2011. “Property sales stats can be a bit skewed,” he says. “I reckon the best properties are about 10% off the peak, the average is 15% down.

But there are lots of new-build re-sales in peripheral areas where it’s much more than that.” The recent housing market slowdown has put pressure on some of the smaller firms who simply don’t have the marketing muscle to sustain high profile property departments. While the ESPC, of which Loudon is a nonexecutive director, remains a first port of call for prospective house hunters, increasingly the bigger firms with the ability to use marketing and innovation look likely to prevail.

What needs to be done to help Edinburgh and wider Scotland? Loudon says it’s a matter of the banks and the building societies lending more money so that people can get mortgages again. So can you get a decent family house in Edinburgh for half-a-million pounds? According to Loudon, buying a serious Edinburgh house will set you back around £1m, be it a big semi in Morningside or a detached house in Inverleith.

“We sold many properties over a million pounds last year,” he says. “The difference being that buyers aren’t taking on massive mortgages any longer. People who are buying are those who have been fortunate enough to build up large equity during the better years, or they have substantial capital. The days of people taking £1m mortgages have probably gone. But I’d like to be clear, every property – from a flat at £250,000 to the bigger homes – is equally important to us because they are all equally important to the client.” In the current market, a good, well proportioned house in a sought-after area still sells well.

“Before, people would accept they may have to pay big money for houses that were, in some cases, a bit of a compromise; whereas they are the ones now not doing so well in the marketplace.” So if you’re on a busy road, under a flightpath or with a north-facing garden, you might not get the premium that was available four years ago.

“Properties where people accepted the element of compromise are not moving so well, because buyers are saying, ‘I don’t need to accept the compromise’,” he says. “And, therefore, a new home now needs to tick nine or ten out of ten boxes, rather than six or seven out of ten. As the recession began to bite, one client suggested adopting the strategy of “Thrive, Don’t Survive.” “As a result, we invested in our website and technology and took the decision to open an office in North Berwick,” says Loudon.

“I saw East Lothian as an obvious extension of the Edinburgh market and love spending time down there.” And what of the future? “I’m keen to keep building the business but also take opportunities to do other things,” he says.

“My wife Ailsa and I want to travel more and there are a few more golf courses to play.” He’s been inspired to make the most of life by a friend reminding him: “There were people on the Titanic who declined the sweet trolley.” While Loudon is increasingly taken by some of the more contemporary houses built in Edinburgh – and he would love to design and build his own home – he has lived in the same house with Ailsa, a consultant gynaecologist, for 24 years.

“In some respects, Simpson & Marwick is still an old-fashioned partnership, but in other respects it’s a very forward thinking, dynamic practice,” he says. “We’ve got the best of both worlds. For me, ultimately, it’s all about client service. I’ve always been willing to see properties myself, out of office hours and late in the evening if necessary, and that really can help secure the instructions.” Those litigators played their part in the story – a few partners in particular, who remain nameless, worked very long hours on a series of high profile and complex cases. “To keep up with them, I had to build something special,” he says. Peers would say he has. Now, that would make a good chapter in a Sandy McCall Smith Edinburgh novel.