Profile: An ear for music and an eye for a monument: Elliott Bernerd: As Chelsfield heads for market, William Kay takes stock of the developer who is building again on his irrepressible properties

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The Independent Online
BREAKFAST at Claridge's, of course. 'I suppose this is virtually your local canteen,' I ventured. 'Sort of,' Elliott Bernerd admitted with one of his sideways smiles.

Bernerd's sleek, jet-black coiffure and elegantly understated suits seem made for a world populated by John Birt, Sir David Frost and other power breakfasters. But on this occasion his melon and berries were overpowered by the more robust ham and scrambled eggs of Michael Sorkin, the redoubtable corporate financier from Hambros Bank who is guiding Bernerd's property company, Chelsfield, to the stock market this month.

It will be the 48-year-old Bernerd's third public incarnation, after Town & City Properties and Stockley Park. He seemed to have arrived 21 years ago, selling a business to Town & City in return for a fat stake and a seat on the board. Then the 1974 crash knocked the property world sideways.

'That gave me the best commercial education in our industry that I could ever have had,' he recalled, 'even if they could devise such a course at Harvard.'

That and other elevated centres of learning are largely a closed book to Bernerd, who left school at 15 driven by what he termed 'an overwhelming desire to be independent'. His parents had divorced two years earlier and he had gone through a succession of schools in London and Bournemouth. His father and grandfather, both called Geoffrey, had been in the film industry.

Geoffrey senior had run Gaumont-British, which spawned the Odeon cinema chain and made pre-war films at the Babelsberg Studios near Potsdam, in which Chelsfield has a half-share. Apart from housing the talents of Fritz Lang and Marlene Dietrich, Babelsberg was used to make Nazi propaganda films, so there is a poetic justice in its coming under Jewish control.

Although the younger Geoffrey was Charlie Chaplin's godson he leaned more towards the business end of film production and dabbled in property. Now retired to Surrey with his third wife, he gave Elliott a taste for business. 'I thought about film, having grown up with it,' Bernerd said, 'but I had this instinctive feeling that I wanted to go into property.'

He began as a teaboy with Dorrington Investment Trust, holding the tape measure on property sites. He moved to a firm of commercial estate agents, Michael Laurie and Partners, becoming a partner at 20. After seven years, Town & City bought the property portfolio Bernerd had amassed with Stephen Laurie, son of the agent's founder. Then soaring interest rates, collapsing values and the failure of the secondary banks that had been lending on property gave him a sharp taste of reality. 'There was a race to keep the company afloat. It would have been easy to sell my shares and run for cover but I didn't'

His loyalty was rewarded when T&C was taken over by Sterling Guarantee Trust, the company led by Jeffrey (now Lord) Sterling, Sir Bruce McPhail and ex-journalist Oliver Marriott. They reversed SGT into P&O, where Sterling is now chairman.

Bernerd impressed this influential trio with his taste for complex corporate transactions, oiled by imaginative financing schemes. From there he swam into the circle inhabited by such luminaries as Lord Rothschild, Charles Hambro, Stuart Lipton and, less felicitously, Roger Seelig of Morgan Grenfell. On the whole, the contacts have been priceless: two of Chelsfield's directors, Michael Broke and Lord Swaythling (the former David Montagu), are graduates of the Rothschild academy.

The connections meant that the death of Stephen Laurie in 1979 was a personal tragedy for Bernerd rather than the business disaster it might have been.

With Lipton and Rothschild he developed Stockley Park, near Heathrow, converting a 1984 investment of pounds 12m into pounds 365m when it was sold three years later to the ill-fated Mountleigh Group. Bernerd's personal share: pounds 20m.

By then he had created Chelsfield with pounds 200,000. By last June its assets, net of borrowings, were worth pounds 130m and Bernerd's master company owns 50.8 per cent.

Chelsfield owns a characteristically eclectic collection of properties, ranging from a cinema in Plymouth to 40 per cent of Wentworth Golf Club. Chelsfield has a toe in the United States through a joint venture with P&O, and in Germany through a tie-up with Compagnie Generale des Eaux.

'The industry has a habit of typecasting property companies into those that invest, collect rents or trade. We do all three. Collecting rent has its limitations, pure developers are at the mercy of the property cycle and once a trader has sold its good properties it is left with a rump. We see ourselves as asset managers.'

Wentworth is quintessentially Bernerd: high-profile, financed by a complex share structure, mixing a business operation with the property element and generating endless opportunities for patronage. The lion's share of a pounds 17m refurbishment budget has been spent on turning the clubhouse into a castellated fantasy, financed partly by raising individual members' fees above pounds 2,000 a year and adding 538 corporate memberships. 'It has all the things I enjoy,' Bernerd enthused, although he himself does not play golf. 'We bought into it in an opportunist fashion. I felt that golf was going to infiltrate into the UK in a greater way than it had.'

Bernerd's penchant for the personal approach to business has inevitably produced the odd hiccup. Through his link with Seelig, he sold Michael Laurie and Partners to Morgan Grenfell. That brought him on to the periphery of the Guinness affair in 1986. When Seelig was looking for people to buy Guinness shares, Bernerd contacted Victoria Seulberg-Simon, an old friend and the sister of Jack Dellal, a 1960s property figure. Nevertheless, Bernerd was a prosecution witness in the first Guinness trial. 'I was part of the house at Morgan,' he recalled, 'and there was some overenthusiasm. But I was really just a spectator.'

Bernerd hit the front pages last year when it transpired that David Mellor, the former cabinet minister, had used a flat of Bernerd's to meet Antonia de Sanchez. 'When you lend a flat to a friend you don't check on what they do in that flat,' Bernerd said. 'The whole thing was unfortunate.'

He met Mellor through the London Philharmonic Orchestra, where both were trustees. Bernerd is currently daggers drawn with Lord Palumbo, chairman of the Arts Council, over its threat to withdraw funding from two of the capital's three orchestras. The council has called on Mr Justice Hoffmann to decide which will be the unlucky pair, and that verdict is due on the same day applications must be in for Chelsfield shares as part of its flotation.

'It's very serious,' Bernerd said of the orchestral manoeuvres. 'We at the LPO have contracts to fulfil, and the jobs of 250 musicians are at stake.'

While Lord Palumbo and Bernerd may be at odds over this issue, they do share an appreciation of the architectural designs of the late James Stirling, who died last year. In fact, Chelsfield claims the honour of having his last work - it commissioned him to design a replacement for Wool House near the Foreign Secretary's residence in Carlton Gardens.

Potential investors might worry that Bernerd is becoming interested in aesthetics to a dangerous extent for a property developer.

'Latterly,' he mused, 'I have been finding that I enjoy good quality architecture - both the design and the concept. I don't like glass boxes.

'I am a great fan of Stirling, and it was a tragedy that he died.'

While such noble sentiments are sometimes rewarded by a grateful nation, Chelsfield shareholders will hope that they do not take Bernerd's languid eye off the search for lucrative new deals. He is turning to the younger generation for fresh ideas.

'We have a collegiate atmosphere,' he said. 'There is a young team and we go in for group therapy, where everyone has a shout about potential acquisitions and financing methods. Most decisions are made on a consensus basis.'

While Bernerd insists he is taking Chelsfield public to fulfil a promise to investors who bought in through a private placing last year, he clearly believes the property market is about to take off again.

'There is a greater depth to the market than most people realise,' he said. 'Consumer demand has picked up: buildings are beginning to be occupied and used. Rents at our Merry Hill shopping centre are increasing.'

There is little doubt he will add colour to a property sector that has languished under the heel of recession. But his followers feel that the real Elliott Bernerd may not emerge until after he has passed his 50th birthday in 18 months. That is when the deals may begin to be replaced by the monuments.

(Photograph omitted)

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