Inventory Reporting and the Build to Rent Requirements

As the build to rent (BTR) market continues to grow to cater for ‘generation rent’, we look at how important inspection reports are, both from a legal compliance and asset protection perspective.

Inventory Hive, the UK’s award-winning inventory reporting app, has seen usage of its software gain a steady stream of users from the BTR sector in response to increasing legislation. Whilst the regulations are necessary for raising standards in renting, they can increase the workload for build to rent operators.

Interim property checks and legal compliance

From check-ins to mid-tenancy inspections, it’s essential that properties are regularly checked to maintain safety compliance and to carry out repairs to the property in due time. And, most importantly, property managers and operators need to be able to show they’ve met these obligations to a satisfactory standard.

Inventory reporting is that proof.

Those reports, providing they show comprehensive, dated detail, will help to prevent tenancy disputes and deposit issues for both, the resident and asset operator.

They also demonstrate commitment to tenancy compliance, should a safety or legislative case arise. From certificates to assessments, an operator must adhere to their legal responsibilities. Keeping up with the ever-increasing and complex industry regulations isn’t easy but apps like Inventory Hive make the process infinitely more straightforward with timely prompts and current information.

The Mercian, Birmingham by Moda

Protecting build-to-rent assets

But it goes further than compliance and responsibility. With build-to-rent, it’s also important that heavy investment is protected. This is a new, shiny property with perfect interiors. The longer that quality is maintained, the greater the return on that building.

Interim checks and inspection reports introduce an organised maintenance process and record of repair. Lessons learnt from one property can be duplicated throughout a portfolio to help avoid property issues and maximise efficiencies. These inspections serve as a valuable roadmap for future build-to-rent developments too.

Interim inspections and comprehensive reporting can often feel like an extra admin task to add to an already heavy day for the BTR operator, but the pay back is worth it – and then some.

Moving away from manual

The trick is to find the most efficient way to bring these checks and reports into daily practice, taking advantage of today’s tech automation and savvy software. The more we can move away from manual admin for straightforward but necessary tasks, the more time is left for focusing on people-centric delivery.

The Arches, Leicester by Cortland

Learn more by booking in for a chat with Alex Gooch here or email on AlexG@inventoryhive.co.uk.

Who Lives In Build To Rent? March 2022 Release

Build to Rent part of the solution to London’s housing crisis

A snapshot analysis of twenty developments across London has found Build-to-Rent homes could help more Londoners find affordable, high-quality accommodation with additional amenities, playing its part in solving London’s housing crisis.

The new report ‘Who lives in Build-to-Rent?’ by the capital’s leading business campaign group London First, in partnership with British Property Federation (BPF), Dataloft, and UK Apartment Association (UKAA), highlights that Build-to-Rent also offers longer-term, secure accommodation with 95% of Build-to-rent schemes offering tenants a three-year lease and a further 10% of schemes offering longer. So far, 33,835 developments have been completed, and there are currently 15,299 Build-to-Rent developments under construction, with 40,544 in planning. 

The data shows the Build to Rent sector is an affordable option available for singles, couples, sharers and families looking to make a long-term commitment to their living arrangements. From those sampled, Build-to-Rent residents’ incomes are broadly similar to those living in the private rented sector, with 27% of Build-to-Rent residents earning between £26,000 to £38,000 compared to 26% of those living in the wider private rental market. For couples and sharers, their gross house income spent on rent was below the 30% national benchmark.

The report provides insight from across the 9,994 residents living in 6,267 homes across 20 schemes found:

  • Two-thirds (66%) of residents in our Build to Rent sample were couples or sharers, compared to 51% in the wider private rental sector.
  • Just over a third (35%) of tenants have a three-year lease, with 95% of Build-to-rent schemes offering this type of lease.
  • Build-to-Rent has comparable levels of affordability to the private rented sector for all tenancy types.

Stephanie Pollitt, Programme Director for Housing at London First, said:

“The pandemic has put the private rental market under increased scrutiny, but this report shows that well-managed homes that are high-quality, affordable and available for longer leases can increasingly be the reality for Londoners.

“There is sometimes a perception that Build to Rent is not accessible to many tenants, but this report demonstrates that the sector is able to meet the needs of Londoners at whatever stage in life they’re at, including for those with families. Build-to-Rent developments are not just a quick fix – they are a viable long-term solution for many, and the sector has an important part to play in helping to alleviate London’s housing crisis.”

Dave Butler, CEO, UKAA, said:

“This timely report adds further evidence that Build-to-Rent is a quality housing solution for a wide range of people – families as well as couples and young professionals.  The gathering pace of the sector means that all across London we can look to BTR as a genuine source of additional housing delivered faster than other solutions and with a greater focus on residents’ needs and aspirations.”

James Simondson, Assistant Director of Policy, BPF, said:

“This report again shows that Build-to-Rent is a key solution to the many housing challenges facing London. Build-to-Rent is delivering an unparalleled renting experience to a diverse range of Londoners – high quality, professionally managed, affordable and tenure-secure homes with access to amenities included. Additionally, and as this report outlines, Build-to-Rent has been a key delivery partner to the Greater London Authority in building intermediate rented homes in tenure-blind Build-to-Rent schemes. The release of this report is a timely reminder that with greater collaboration between local authorities and the sector, we can unlock the full potential of Build-to-Rent to provide intermediate rented homes in integrated and sustainable communities across London.”

Sandra Jones, Managing Director, Dataloft, said:

“This is the second ‘Who Lives in Build to Rent?’ study for London and the data sample has increased five-fold since the first report.  Twelve operators and investors kindly contributed their data this time which is testament to the spirit of collaboration and co-operation in the sector and the drive to deepen understanding of its customer base. Getting this level of industry support means we can build a robust foundation of knowledge as the sector matures.”

DOWNLOAD A COPY OF THE REPORT HERE >

Access corporate lets with TrustedStays in partnership with UKAA

Our partnership venture with TrustedStays provides a platform for operators to make their properties available globally to the Corporate and Government Lets market. This income stream with a potential value of around £8bn is exclusively available to members of the UKAA and STAA. We are currently piloting and onboarding the first UKAA members and look forward to many more of you signing up in the coming months.

TrustedStays.co.uk is the world’s first industry platform connecting professional home rentals with government and business stays – to attract corporate guests on flexible lets. Properties listed on the platform have to meet specific accreditation standards, giving corporates the confidence to book them for staff. By listing your units on the site, you will access bookings from the corporate market who may be looking relocate staff – with the potential to convert these into longer-term stays.

For more information please the TrustedStays website:

Visit TrustedStays

New Central Register and Certification Scheme for Building Safety Managers launched

The Building Safety Alliance, an independent industry led ‘not for profit’ organisation, is launched with the purpose of implementing the certification of competent individuals wishing to deliver the role of building safety manager (BSM) and a publicly accessible register of those certified by the scheme.

The Grenfell Tower tragedy brought to the fore how the safety of all buildings needs to be ensured. Recognising the role they play in delivering safe buildings, representatives of both the public and private sector have come together to deliver the change in culture needed and the uniform standard of competence that residents should expect from those responsible for their safety.

The Building Safety Alliance will deliver initially two functions:
• The certification of individual building safety managers (BSMs) or Nominated Individuals within the BSM (organisation) (both referred to as BSMs here); and
• A publicly accessible register of those certified by the scheme.

In due course, they will also work with others to evaluate how organisations who wish to deliver the function of the BSM can be assessed as having the organisational capability to do so and how to assist contractors and suppliers to higher risk buildings to deliver a competent workforce that understands how to ensure that residential buildings are safe for residents.

The Building Safety Alliance will play an essential role in helping to improve the competence of those responsible for managing buildings so they can deliver safe homes for people. The Building Safety Bill, published on 5th July 2021, confirmed the new statutory role of the BSM, a concept first developed by Dame Judith Hackitt in her Review.

Anthony Taylor, Interim Chair of the Building Safety Alliance said: “I’m proud to continue to take forward and implement the recommendations from Working Group 8 (WG8) of the Competence Steering Group. When we were initially asked to develop the competence requirements for the new statutory role of BSM, we recognised that for the framework to work, we also needed to set up wider structures that would support the development of and drive for a recognised and uniform standard of competence.

“One of our key recommendations was the need for a register that would allow residents and accountable persons to check if the BSM for their building, meets the minimum competence requirements. Government is looking at Industry to deliver this, so we stepped forward with our wide consortium from across both the private and public sectors.”

Bob Smytherman, Chairman of the Federation of Private Residents Associations (representing 1000’s of long -leaseholders across England & Wales) said:

“Our leaseholder members will find themselves with new duties and responsibilities under the Building Safety Bill to ensure our buildings are as safe as possible. Our members will be looking to the Building Safety Manager as the stakeholder responsible for the day-to day building safety management of our buildings.

“We have a crucial role to play in the Building Safety Alliance, to make sure Building Safety Managers are not only competent but also understand the resident perspective when appointed to make our buildings safe. After all, these buildings are our homes and we pay the service charges.”

“We look forward to the register coming into existence, so that we can feel safer in our buildings, confident that any of the certified Building Safety Managers on the registers will meet the national competence standard most appropriate standard for our homes.”

The WG8 Competence Framework is now being translated into a MHCLG sponsored Publicly Available Specification (PAS), and once finalised, this PAS 8673 will be the standard to which the Building Safety Alliance will certify candidate BSMs against, before allowing them onto the Register. The PAS is being developed in parallel to the legislation to make sure certified BSMs will be delivered by the time the legislation becomes enforced.

For further information and updates please register your interest here.

The Unexpected Outcome of Stellar Customer Service at Build To Rent Communities

As the coronavirus pandemic pressed down, customer service at BTR communities soared.

Build To Rent (BTR) has had a speedy and strong evolution from its single-family rental roots, and this momentum has led to a revolution in rental housing in more areas than one. Private equity firms are acquiring huge portfolios, successful and profitable BTR projects are attracting more investors, lending institutions are confidently funding BTR loans, and consumers are opting for a rental property versus a mortgaged home.

However, it’s more than lack of savings and daunting debt that is driving this latter trend of consumers choosing to delay buying and instead jump feet first into renting. They are pining for more space, craving a sense of community, looking for luxury, and prioritizing convenience and customer service among the most important features that steer their decisions.

Customer service, in particular, was forced to be reimagined during the pandemic as the entire world masked up, maintained six feet of distance with every human interaction, and businesses scrambled for new ways to help their customers. BTR operators quickly had to pivot to create a safe space for existing and future residents by providing virtual tours, restructuring rental rates, and offering additional amenities across the renter’s entire experience — from leasing to move in and beyond.

And, while this abrupt change may have led many to believe that customer service in the BTR community would decline during a pandemic, the latest data published in the UKAA and Grace Hill KingsleySurveys Resident Sentiment Survey Report reveals the opposite.

The UKAA and Grace Hill partnered to conduct a survey to measure and assess the impact of the COVID-19 pandemic on renters’ experience and future decision-making regarding renting in the UK. The survey results, which comprised over 1,000 residents living primarily in Greater London, revealed a variety of insights related to the pandemic: how it impacted renters financially, the satisfaction level of residents of BTR communities versus with a private landlord, the percentage of renters who plan to move within the next six months, property manager perception during the pandemic, and how management firms should continue to adapt.

The key findings around the satisfaction level of residents at BTR communities compared to those renting from a private landlord were particularly insightful and ultimately revealed that BTR respondents were more satisfied with the management’s response to the pandemic. More specifically, 68% of respondents indicated good or excellent satisfaction with their management teams’ general service during COVID-19, while 73% of residents at BTR communities indicated good or excellent satisfaction in this area. In addition, 63% of those renting from a private landlord stated the same. Even more interesting is the data that illustrates the general service rating area — spanning communication, actions, cleaning and sanitation, efforts to support residents, and efforts to create a sense of community — had the largest statistical difference between residents at BTR communities and those renting from a private landlord.

Additionally, residents at BTR communities also were more likely to recommend their community at a 9 or 10 on the Net Promoter Scale®*, with 37% of BTR residents falling in this group compared to 34% renting from a private landlord.

 

2020 was a year of tumultuous change, and as we slowly exit from the peak of the pandemic, we anticipate the demand for BTR communities to continue to grow. Top-notch customer service will also strongly impact where consumers rent and whether they stay or move. As the BTR industry continues to evolve, strong relationships will be key to achieving sustainable growth. After all, creating great living experiences is paramount in property management, and that means putting residents and resident experiences first. The data clearly reveals that residents are most impacted by the quality of service provided — even during a pandemic — so it will be imperative for BTR communities to continue providing customer service that soars.

*Net Promoter, Net Promoter System, Net Promoter Score, and NPS are registered trademarks of Bain & Company, Inc., Fred Reichheld and Satmetrix Systems, Inc.

 

 

Written by Helena Kelly, Marketing Consultant for Grace Hill

Greystar announces €725m close for flagship pan-European closed-end value-add residential strategy

 

 

Greystar Europe Investment Management B.V. (the “Manager”) closed €725 million in equity commitments into its flagship pan-European value-add discretionary vehicle. The vehicle received equity commitments from a diverse group of global institutional investors from Continental Europe, North America and Asia-Pacific including both new and existing Greystar investors.  The Manager is a subsidiary of Greystar Real Estate Partners, LLC (“Greystar”), a global leader in the investment, development and management of high-quality rental housing properties.

The pan-European closed-end value-add residential vehicle is targeting €1 billion of equity commitments and will leverage Greystar’s unique vertically integrated platform across the region to target top cities in the United Kingdom, Netherlands, Spain, Ireland, France, Germany and Austria. This adds to Greystar’s 30-year track record of investing in global value-add opportunities to date.

The announcement comes at a time when the Europe multifamily and student housing sectors are characterised by limited supply of quality rental housing. This, coupled with both continued urbanisation trends in Europe’s top cities and the increasing unattainability of home ownership, has resulted in a growing renter cohort.

The discretionary investment vehicle will focus on the acquisition and select development of purpose-designed, thoughtfully amenitised and professionally managed rental residential assets, including multifamily and purpose-built student accommodation. Greystar’s local sourcing teams will continue to employ the company’s historically successful research-based approach to identify strategic investments in undersupplied markets with favourable demographic trends and leverage its vertically integrated platform to add value to assets through capital improvements, repositioning and operational enhancements.

The vehicle has seed investments in the UK, Ireland and the Netherlands with an active pipeline of investments across its target cities.

 

Mark Allnutt, Senior Managing Director – Europe, Greystar, said: “This opportunity is the culmination of more than seven years of hard work establishing the only vertically integrated pan-European residential platform, which means we have the capabilities to invest, develop and operate assets under one roof. We are therefore uniquely placed to offer simplicity and scale to investors seeking European residential exposure. Further, we are excited to take advantage of a market where demographic trends combined with the structural undersupply of housing is driving demand for high-quality rental properties across Europe.”

 

Wes Fuller, Executive Managing Director – Global Investment, Greystar, said: “The investment opportunity in European rental housing is extremely compelling. We have an experienced and talented European team located in the cities where we have the highest conviction.  The flagship strategy in Europe follows a successful track record of European value-add investments and follows the formula of Greystar’s long history of value-add acquisition strategies in the US. We are thrilled that existing and new capital partners have supported Greystar with this closing which is a testament to the market opportunity, our team and the demand for residential real estate globally.”

 

 

Read Greystar’s European rental housing whitepaper here.

How to supercharge your BTR development post-pandemic by Rowdy Studio

Post-lockdown spikes, recessions. Construction pauses, buyer hesitancy. As with almost every sector of the UK economy last year, Covid-19 ripped up the real estate rule book—whether through stamp duty holidays and work-from-home mandates, or anticipated price plummets and corporate portfolio clear-outs.

Yet, amidst the uncertainty and fluctuation, were some promising glimmers of hope. One such opportunity came in the form of the UK’s growing build-to-rent (BTR) market: purpose-built property developments designed and constructed to appeal to renters over long-term homeowners.

According to the British Property Foundation, it’s a sector up 22% on this time last year—with 167,853 properties now available across the UK. Even more, it’s a segment showing no signs of slowing down. A recent report predicted the BTR market will triple in size over the coming years, thanks to its increasing viability post-pandemic. Renting, after all, becomes an ever more attractive proposition through financial uncertainty.

Capturing the opportunity

So, how can BTR developers best seize this opportunity? The key might be looking closely at who is left behind. A valuable part of BTR’s proposition to date has been the promise of enhanced lifestyle for Generation Rent—that is, better management, more amenities and higher standards of living for those unable or unwilling to get themselves on the property ladder.

Now, at a time when many are considering a migration out of city centres in the name of flexible working and reduced rural prices, dialling up the desirability of urban living and rental freedom has never been more crucial. Which begs the question: why is brand still largely absent from the BTR sector? We see square footage and floorplans taking precedence over storytelling and aspiration. Weekly prices and security deposits commanding messaging over independence and community. Where is the bigger picture?

After all, those ahead of the game and utilising brand are already reaping the benefits. A recent Colliers Rental Insights study found that BTR schemes with brands distinct from their developer commanded a blended premium of 10.4% over local comparable stock in 2019—a percentage only expected to grow.

 

1. Define your story

Every brand needs a solid story.

A narrative or articulation of what you do that is equally foundational and educational. Laying the groundwork for how you act and communicate, whilst informing your target audiences on the benefits and reasons to believe in your offering.

 

Take the Dublin-based BTR scheme Occu, launched last year. As a relatively new concept for the Irish market, attaining success required less spec, more story. ‘All you have to do is move in’ became its central concept— emphasising on the seamless service found across the scheme. It was this thematic focus that secured record interest and tenancy signatures upon launch. In a world where renting still suffers from the social stigma of being “dead money”, BTR schemes should use language to land the benefits.

 

2. Shape your experience

For years now, we know the property sector has been shifting towards a more customer-focused approach— where’s it’s less about the bricks and mortar, and more about the proposition housed inside.

But for BTR developers, this needs to go one step further. Schemes need to take their story and ensure it’s activated across every touchpoint—from websites and apps, to onsite amenities and move-in experiences.

 

Think about it. Why would you feel more compelled to book a desk at a WeWork or Soho Works over a Regus? It’s because we know what we’re getting, how it’ll function, and—more than anything—how easy it is. Renting a property should be no different.

 

Moving forward, the BTR sector will need to learn from sophisticated, amenity-rich destination brands. Whether through décor or digital, stories are only successful if brands practice what they preach. Developers need to realise and demonstrate the vision through a customer experience that feels on point, on brand, and consumer first.

 

3. Build your community

With a proposition defined and a customer experience created, how do you successfully build your community of tenants?

The answer will be found in listening to the needs of prospective customers. What kind of outreach are they responding to? What are they looking for right now from a rental? How can you best communicate with them and convey your key messages?

Now more than ever, brands need to be ever-evolving entities. Responsive to the rapidly changing demands of their sector and audiences. BTR developments will need to zig and zag accordingly: creating tailored communications and messaging that listens, learns, and looks to foster loyalty.

Look at industry leader Quintain, whose management arm Quintain Living—formerly Tipi—taps into the emotional desires of its tenants. “We want to create the best rental experience for you,” it writes. “We like to think we’ve thought of everything, but if we haven’t just let us know.”

VIDA – experts in the design

 

VIDA are experts in the design and supply of wholesale furniture to Retail, BTR Projects, Student Accommodation, Holiday Lets, Leisure Parks all over the UK, Ireland and as far as Australia.

We are a family-owned business with more than 40 years’ experience. We have over 300,000 sq ft of warehousing, and import more than 1000 40ft containers a year – so we are big enough to cope but small enough to care.

Our professional and dedicated teams are highly experienced in end-to-end management, from the initial design concept to installation and aftercare, and we offer a direct container from factory to site or storage facility as a project cost save service.

With a portfolio of more than 1,000 off-the-shelf products (including furniture packs), we have something to suit all tastes and budgets. However, if you are looking to elevate your project and stand out from the competition, our in-house design team can work with you to create bespoke products by customising fabrics, colours and materials.

Please contact jon.williams@vidaliving.com to learn how your furniture procurement can benefit from partnering with VIDA.

UKAA Joins LandAid Network Against Homelessness in 2021

 

Throughout 2021 we will be working alongside other networks from across the industry to help achieve LandAid’s mission: to end youth homelessness.

For those unfamiliar, LandAid is the property industry charity. Each year it gives out grants of around £2m to provide accommodation for young homeless people right across the UK. It’s a charity we’re really passionate about. If you would like to find out more you can visit their website here: www.landaid.org.

We will be sharing news and updates with you throughout the new year.

Sky joins the BTR camp

The Sky Property Partnerships programme has been designed as a fresh take on our ongoing commitment to work together, to deliver the best-in-class service our audience has come to expect.

Our nationwide team can help you connect your residents to Sky, putting the content and products they love at the heart of the home with some of the best deals on the market.

We are confident that the Sky brand adds a huge amount of value to your client journeys and of course, your bottom line.

By working together, you will be offering a Sky product portfolio that is already enjoyed by over 12 million UK households and unlocking an amazing range of partner offers for your market; all with a customer journey specifically tailored to your industry. We combine this proposition with a generous commercial model, ensuring that everyone we work with, be that residents and partners stand to see maximum value.

To become a Sky Property Partner, reach out to us below for the next steps

Louisa Dabbs on 07890 605 398 / louisa.dabbs@sky.uk

PropertyPartners@sky.uk

propertypartners.sky.com

The countdown to the relaunch of OpenBix has begun!

As you have probably seen and heard by now the OpenBrix relaunch is due to take place in just a couple of weeks time and ripples are already being felt throughout the BTR industry.

 

Unlike traditional property portals that currently exist OpenBrix offers a low-cost innovative property listing portal that innovates and connects Tenants to a property directly and all under your control.

 

Build to Rent Landlords on OpenBrix can also connect their tenants to various suppliers (or their chosen bespoke partners and suppliers) to facilitate a slicker, transparent, and more cost-effective manner and benefit from any introduction commissions. All under the control of the Build to Rent Landlord or their chosen agent. If you wish your tenants to only see the products from your chosen partners, then OpenBrix can integrate these partners or suppliers for you.

 

Good tenants on OpenBrix can use their APP to own their own “Sovereign ID”. A validated ID that is not owned by anyone else other than themselves. They can start to generate an immutable and automated record of rent payments which are auto fed to Experian and Equifax via our partner CreditLadder to increase and influence their credit histories and credit scores. A UK first. Offering tenants, the chance to have their prompt rental payments help them, in the future, to obtain a better mortgage offer, better credit or indeed credit where there was none can only be a good thing. It also incentivises tenants to pay their rent on time as late payments may likely negatively affect their credit scores. Of course, this facility also allows them to prove their suitability as a tenant going forward should they ever move to another tenancy. These rental ledgers can be “white labelled” to suit a UKAA member if requested.

 

Tenants on OpenBrix can use easy to adopt ‘moving-in’ services from the OpenBrix Network, to include verified Right to Rent, Referencing and more.

 

OpenBrix gives value to Corporate Landlords, their chosen Agents (if applicable), Tenants and Suppliers, the entire industry benefits.

 

Ultimately OpenBrix offers the BTR industry the ability to offer their Tenants a sovereign Identity by allowing them to pre-verify their Right to Rent and hold copies of any of their personal documents on their own device. The tenants can keep an immutable rental ledger, a record of validated rental payments and have these read by Experian and Equifax to influence and improve their credit histories and credit scores. An ID of important value and rightly owned by the consumer and not by anyone else. Truly a global first.

 

To find out more information and to register your interest please visit OpenBrix.co.uk

Welcome new members Johns & Co

JOHNS&CO is an established  property lettings, management & estate agency business, providing a fully integrated range of PRS/Build to Rent services across London & The Docklands.

Founded in 2013, our nine offices (seven in London, plus Hong Kong & Singapore) are supported by an expert team of over 80 staff, with comprehensive local market knowledge and an in-depth understanding of all facets of Build to Rent.

Clients such as Greystar, Grainger & leading BtR developers Ballymore, have chosen JOHNS&CO because of our outstanding client focus, exceptional customer service & attention to detail. We understand & appreciate all of the nuances of the Build to Rent sector, from initial consultancy & sector analysis, through project sourcing, design and planning, financial/lifecycle modelling, marketing and let-up. This holistic approach has enabled our clients to develop sector-leading assets, with exceptional operating performance and enhanced margins.

Membership growth in challenging times!

Despite the ongoing impact of the pandemic, the team are delighted to report that UKAA membership has continued to grow over the past few months! It’s clear that existing and new members are seeing the benefits of being able to actively engage, share best practice and learn from each other. We’ve seen fantastic participation in our webinars and, in particular, the four new Forums we have introduced – Leadership, Lender/Borrowers, Operators and Suppliers.

We now have 231 members in total, representing over 1500 industry professionals. The membership is well balanced too – comprising approximately 33% owner/ operators/ investors; 50% suppliers; with the remainder falling into the individual member or partnership category.

Over the past few months we have been delighted to have been joined by Lendlease, Goodlord, Harrington Housing and Spruce Homes (part of Southern Housing Group) to name but a few. For a full list of our current members you can now download a handy summary here – UKAA Members List.

Of course, UKAA also benefits from being part of the NAA’s affiliate network  – their most recent membership report is showing NAA now represents an incredible 10 million units and has more than 86,000 members! Might take us a little while to get to these numbers, but we’re definitely heading in the right direction.

If you are working with organisations you think might be interested in joining UKAA do please introduce us – Dave or Amanda would be delighted to chat to them about the benefits of joining our expanding organisation.

 

Picture 1: Membership breakdown

 

Picture 2: Membership growth

Dataloft Briefing Notes: Short Term Loss In Overseas Students

Dataloft has just published the latest in its series of Briefing Notes looking at UK residential rental markets in the light of Covid-19.

This one examines the potential impact of a fall in the number of overseas students on rental markets around the UK.

If you would like us to look in detail at the impact on a particular city or locality, please get in touch with Dataloft.

It’s available to download from dataloft.co.uk in the News section or download below:

Covid-19 CEO’s Update: 5th June 2020 – A sense of community – part 1

A few words this week (and in my next couple of blogs) on a topic that has filled more airtime on BTR webinars over the last two months than almost anything else – Community.  We have spent a lot of time promoting community as crucial to successful BTR schemes, both in creating somewhere people want to live and ultimately in financial success. On the other hand, we haven’t always been clear about exactly what we mean by community or how we measure it.

One of the best definitions that I have come across describes the psychological sense of community as “the perception of similarity to others, an acknowledged interdependence with others, a willingness to maintain this interdependence by giving to or doing for others what one expects from them, and the feeling that one is part of a larger dependable and stable structure“[1]

This may be helpful for understanding the concept, and as a geek there is nothing I love more than a precise definition (confession time – my original degree was in Philosophy and Sociology). However, the practical challenge is to understand how to create and manage BTR schemes so that they promote community and thereby improve the sustainable financial performance of our assets.

We have some reasonable output measures – whether qualitative, exemplified by Homeview’s resident reviews or quantitative in terms of length of stay and renewal rates. We also know from the ideas shared on the UKAA operators’ forums about the sorts of actions that are being taken to engender a sense of community in these challenging times with lots of evidence of success. Equally many of know from bitter experience of the negative impacts of a lack of community in terms of anti-social behaviours.

The answers to my challenge aren’t maybe as obvious as you might think and over the next couple of blogs I want to explore some sources and approaches that will hopefully of practical use to those of you who share my interest in the topic. To do this I will be picking the brains of some of the smart people who work in our industry as well as adding my own not very original ideas.

This week though I want to start by pointing to a couple of sources that I have found helpful.

The first is a book recommended to me by Brendan Geraghty of Geraghty Taylor, one of those smart people I mentioned. Headspace – The Psychology of City Living, by Paul Keedwell is full of interesting ideas and experiments in understanding how people react to the spaces they inhabit, (though sadly lacking in those great photos which are the best bit of most property books).

The second is an article by Nicola Bacon of Social Life who have done a lot of work in this area. The most succinct introduction is in an article she wrote in the RSA Journal in August 2019 about belonging. As she says “Only when we can define, measure and quantify our emotional reactions to place can we design interventions that positively affect how we feel.”  Download the article here.

Finally, if you come across Karl Kalcher of Mindfolio ask him about Place Attachment. Karl is one of the nicest people I have ever met (and a man with a fascinating career). Place Attachment is Mindfolio’s framework for measuring the emotions of place and is really interesting and practical approach to this subject.

 

Sadly, neither Social Life or Mindfolio are UKAA members (yet), so I probably shouldn’t be promoting them, and I will therefore finish with an inspiring example of community in action from one of our members.

All of you will know Harry Downes, the MD of Fizzy Living but who once lockdown is lifted has committed to undertaking the Marathon Des Sables. This is a six-day, 251 km ultramarathon that takes place every year in the Sahara Desert. Harry has apparently never run a marathon in his life but his sense of community is driving him to do this for Walking With the Wounded  You can support him here

More on community and the relationship with placemaking and sustainability in the next blog – and do  let me know what you think.

Until then stay safe and well

Dave Butler

 

 

[1] Sarason, S.B. (1974) The Psychological Sense of Community: Prospects for a Community Psychology. Jossey-Bass, London.

 

BTR Awards Form

Many thanks for taking part in the first UKAA BTR Awards. Please make sure you have familiarised yourself with the criteria for the award you are about to submit and the submission guidelines.

 

All nominations should be uploaded in a word of pdf file.

 

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Winners of our Best BTR Image – Get Living

The UKAA ran a competition looking for the ‘Best BTR Image’ to feature in this years’ UKAA Annual Conference A Life in a Day: Build To Rent from Idea to Stabilisation. 

Many thanks to all our members who sent in spectacular BTR images, it was sincerely inspirational to see what our members are accomplishing out there!

We are delighted to name Get Living as our winners with an image photographed by a Get Living resident, Frank Da Silva of Victory Plaza, East Village.

 

We were pleasantly surprised to learn the project was documented and photographed by a resident:

“Since I moved to East Village with my partner five years ago, our lifestyle has changed dramatically. We use the Olympic Park’s facilities on a regular basis, we joined a local running club and we are always engaging more in community activities. As an urban landscape photographer and architecture enthusiast, the transformation of the area and the Olympic legacy always fascinated me and being in here inspired me to capture all the latest developments in East Village and the new and exciting neighbourhoods that are emerging in the area.”
Frank Da Silva, Photographer | www.FDAS.co

Get Living are transforming landscapes with great BTR initiatives and an award-winning residential owner:

We’re delighted to have won the photography competition with images of Victory Plaza, our first 500 new homes in East Village since the 2012 Games, captured by one of our very first residents.  

 

“Designed with the resident experience in mind and built using innovative construction methods, Victory Plaza represents everything we know makes for great city living and marks a major milestone for East Village, which over the last five years has been hailed as the standard bearer for the build-to-rent sector. It was the first neighbourhood of its kind in the UK and we’ve shown that it can work. We’ve learnt a lot along the way, primarily shifting the focus in the private rental sector to a customer experience that is rewarding and hassle-free, so our residents have greater opportunity to live life in the city to full potential.”

 

“This year Get Living will reach 8,000-homes in operation or development across five major city neighbourhoods. The wider build-to-rent sector is also gaining momentum and together we are delivering much needed homes across the UK. In recognition of the sector’s successes the government is showing more support for quality, well-managed rental homes in the housing mix, with sector-led initiatives reflected in the Tenants Fee Bill. Our new homes at Victory Plaza, together with our new neighbourhood of 300 homes in Manchester, now mean there are more than 30,000 build to rent homes completed across the UK.”

Neil Young, CEO, Get Living

We always love to see images of BTR projects our members are working on. Please feel free to send them to us at info@ukaa.org.uk.

 

ROOMSPACE Serviced Apartments – Not your typical tenant

Roomspace is the longest established corporate housing (¹) brand in the UK, founded in 1995 by Charlie McCrow.

Roomspace currently provides more than 450 high quality, fully furnished serviced apartments for corporate or extended business stays, relocation and project work. Roomspace prides itself on being able to offer their clients a full in-house experience, including weekly cleaning, guest services and coordinating property maintenance.

Apartments are situated in over 25 locations across the UK, Spain and Portugal. The brand continues to develop and grow with continual investment in both product and people and our key focus is on providing exceptional guest service. In 2018 Roomspace added 45 new units to their portfolio in 4 newly completed blocks and is actively looking to expand by working closely together with estate agents, property developers and investors.

Property landlords who plan to rent out their buildings as long-term investments see the advantages of working with serviced apartment operators like ourselves.

Once our relationship has been established, it really is a perfect partnership with the shared aim of keeping the apartments and investment looking as good as possible and rented for the long term without any voids knowing they will be well cared for. Our tenants (guests) are almost all business personnel and their comfort and experience is our first and foremost concern. We know that the quality and state of their rental apartment has a big impact on how they rate their experience with us as our landlords do.

With the emerging build to rent sector the opportunity is there for Roomspace to make further connections in the industry and expand into new locations with an enhanced service offering made possible by the tenant focussed design of these new developments.

Three years ago we started the rolling project Pantone 21 (named after the colour of our logo) to upgrade and improve our ageing inventory (some of which we have had in our portfolio for more than 20 years) to bring it in line with our newer locations and this has only been possible with the co-operation between our loyal landlords and our dedicated operations team who have been busy upgrading furniture, redecorating, replacing floors, kitchens and bathrooms.

Roomspace is getting ready for the next decade, with plans for further expansion throughout London and the South East of England and also in our other major hubs like we have in Madrid and Lisbon.

For further information visit our website, www.roomspace.com, or email property@roomspace.com

 

(¹): Corporate housing is a term describing the renting out a furnished residential apartment, condo, or house on a temporary and usually flexible term to individuals, military services personnel, or corporations as an ideal option for short to medium term stays.

UKAA New Buzz – Review of Week 2

Top BTR Stories 

BPF Build to Rent Map

The BPF and Savills have just released the Q4 update showing continued growth in the sector, total units up 22% year on year but the balance of development shifting back towards London from the regions in the last quarter

Read more >>

Date for tenancy fees ban confirmed

 

Just in case you missed it the tenancy fees ban will come into force on June 11 this year – here’s the full details from ARLA

 

 

 

Designing creative resi schemes

The challenge of optimising use of basement and ground floor space addressed in this story from Biznow

Read more >>

 

Flatfair featured in Property Eye this week

Read more >>

 

Mike DelPrete

Mike DelPrete – Global Insights Zoopla’s private equity strategy shift. Portals are one of the big areas of competition for our industry and Mike DelPrete’s Global Insights offer some of the best analysis freely available

Read more >>

 

NAA News

The February edition of Units magazine will be winging its way to you shortly – electronically or in hard copy – remember tell us if you’re not receiving it. In the meantime, some more thought provoking stories  from the NAA:

What’s the right role for automation in property management?

Who are today’s renters in the US?

Flat Findings: Market Distinctions & Opportunities in the UK and US by David Danish, RealPage

Aside from the obvious differences between the Queen’s English and whatever it is that we’re meant to speak over here across the Atlantic, working with owners and operators in the build-to-let sector on both sides of the pond is a continuous learning experience.  Adopting a whole new vocabulary, though, has been only one of the many interesting aspects of comparing what we have seen so far in the U.K. vs. the state of the industry in the U.S.

Finding Opportunities: Professionally Managed Flats

Years before RealPage established a permanent footprint in the U.K. with the acquisition of PEX, we began to learn about the U.K. market through the lens of a variety of owners, operators and investors across the country.  There are a few primary differences that have struck me to-date, though – all of which are likely to shift over time given the tremendous rate of change that this fledgling sector is experiencing across the Isle.  While the traveler in me would much prefer to focus on our similarities rather than our differences, the consultant in me finds that what separates the two markets right now offers far more opportunity for growth.

To begin, U.K. schemes have a terrific opportunity to differentiate themselves as “professionally managed flats” – distinct from the privately-held units that in most cases cannot compete with offerings such as on-site caretakers, a dedicated lettings team, and beautifully shared spaces for relaxing, entertaining or exercising.   In addition, anxious private landlords may hesitate to offer a desirable tenancy of 12-months or longer whereas most build-to-rent owners we’ve worked with are happy to provide this stability to their perspective residents.

Finding Opportunities: Flat-Specific Amenity Valuation
Another distinction of the U.K. build-to-rent sector is that the concept of identifying, recording and assigning a value to flat-specific amenities is still in its relative infancy.  Notating which specific flats have the most desirable views or the beautifully upgraded kitchens—and documenting it within the property management software—will afford owners the opportunity to market at the right rate for quicker letting, while still achieving optimal rents.  Building this functionality right into the software ensures that each flat is priced right, relative to others within the building without having to re-walk them every time they become available to let.

U.S. schemes will typically have a thorough list of particulars/amenities assigned to each flat with a dollar amount attached to make each unit equally popular, relative to others within the same scheme.  Common amenities in the U.S. include:

  • Washer & Dryer
  • Balcony
  • Upgrade/Refurbishment
  • Pool View

Snapshot: Amenity Value Impact on Schemes (By Class)

In a Class A scheme, these amenity values average over 6% of the total rent roll.  The popularity of specific particulars will vary across markets.  An outdoor space such as a balcony, for example, may garner a heftier premium overlooking the sea in Brighton than it would in Manchester.

Finding Opportunities: Flexible Tenancies

Finally, another divergence between how our partners in the U.K. operate today and what we commonly see in the U.S. is the approach taken to offer “flexibility” to our residents when it comes to their tenancy. Primary examples of these disparities include:

  • UK. lettings often have the option for a break-clause at the 6-month point, at no additional cost to the tenant
    • The potential for a mid-term lease-break creates uncertainty in forecasting and managing availability for the scheme
    • Off-cycle void notices create barriers to rent roll growth if they occur during the low season in the market
  • US. tenants are typically charged a premium if they desire the flexibility of a tenancy shorter than 12-months
    • The amount assessed will correlate to the increased revenue risk associated with potentially having to redecorate a flat more than once every 12 months
    • Tenancies greater than 12 months may be offered to support adherence to an expiration management schedule that as closely as possible mirrors the seasonal demand patterns of the market
      • In many cases, longer tenancies will be offered at a slight discount to build stability into the rent roll and minimize void periods without impacting offered rents
    • If a U.S. resident does not sign a renewal contract prior to the expiration of their initial lease contract, they will typically incur a significant increase to roll periodically
      • Pricing structures have adapted to incentivize resident behaviors that support stronger revenue performance of the scheme

 

Snapshot: Longer Lease Terms Add Up

 

The accompanying chart is an analysis of over 8,000 stabilized schemes utilizing the RealPage platform in the U.S. from June of 2017 to June of 2018, revealing that nearly 50% of tenancies are 11 to 12 months in length, with a significant percentage of U.S. letters opting for tenancy agreements longer than 12 months.

As we expand our partnerships in the U.K, it remains to be seen just how the build-to-rent sector will evolve.  Without a doubt, some aspects of the industry will mirror common practices in the U.S., while others will take on a uniquely British twist. Look for subsequent market insights shared by our team as we learn more about this burgeoning market and help accelerate its growth, working side-by-side with our clients, colleagues and peers.

The UKAA Shortlisted in the Property Wire Awards

We have the pleasure in announcing The UKAA has been shortlisted for the Best Trade Association in the 2018 Property Wire Awards. We have made the shortlist of 3 after contending with many other well deserving candidates in the category. Property Wire provides daily news on residential and commercial real estate from around the world.

We are extremely proud of what we have achieved so far for the BTR industry and receiving recognition of our hard work makes it all worthwhile. We would like to thank all our members for their dedication and hard work over the months. The winner will be revealed on Friday 23rd March 2018, thanks for your support along the way. Be sure to visit back to the website for updates on the winners.

You can view a list of the nominations on the Property Wire website: https://propertywireawards.com/shortlist/

Glimmers of hope but more political backing needed

In the past fortnight, plans, policies and long-term strategies for the housing industry have been established by Sadiq Khan and Philip Hammond to tackle one of Britain’s biggest challenges over the next 25 years. Due to the vast and complex nature of the UK housing crisis, these political events were highly anticipated by industry observers and have since been met with a wave of contrasting reactions.

It is great to see that the Build to Rent sector is now acknowledged by name at a UK and local government level in both the Budget and the draft London Plan, both recognising that the UK can only truly address the housing crisis by increasing supply. This is definite good news for our sector, we’ve come a long way in a short five years.

However, beyond this I was expecting – or at least hoping – to be greeted with overarching measures that would help address the supply factors, notably unlocking more investment opportunities and properly funding planning departments. Yes, certain policies attempt to address some of this, but more needs to be done if the Build to Rent sector is truly to thrive.

It was encouraging that the Chancellor’s Budget was focused on housing but I have been left with the feeling that renters – and more generally people who are not looking to buy a house – have been undermined. It was positive to see the Government announce it will consult on barriers to longer tenancies to see how landlords can be encouraged to offer them but it’s unlikely this will help raise standards across the private rented sector for some time. Large-scale, professional landlords like us at Get Living already offer longer term tenancies and a fairer deal for renter, what we need is more support in building supply.

In terms of Sadiq Khan’s draft London Plan, the measures included in the strategy coincide more with what we believe in. The Mayor’s Plan argues that part of the long-term strategy to tackle the housing crisis in London is to build taller and denser buildings in and around the capital, especially around transport hubs. Areas of focus such as this play to the strengths of Build to Rent and it was refreshing to see the sector get the attention it deserves.

At Get Living, we’re also ambitious with our growth targets, but the Mayor’s target to more than double homebuilding output from 29,000 to 66,000 by 2029 looks sadly unlikely against a backdrop of London housing market volatility and Savills’ forecasted fall in housing supply from next year.

Reflecting on the past few weeks, I am pleased that both the Chancellor and the Mayor of London have recognised the strengths of Build to Rent and the opportunities it brings to deliver new homes across the UK with community, great shared spaces and customer service at its core. The Build to Rent sector has a huge role to play and needs to keep speaking up to ensure the supply grows well beyond 100,000 homes so renters benefit in the capital and beyond.

Neil’s full piece can be read on Rent Magazine

PRSim response to the November 2017 Budget

The Chancellors move to abolish SDLT for first time buyers to a threshold of £300k will be seen as a positive move by many who have argued for its abolition for some time. It will also be welcomed by those people currently buying and looking to buy their first home. This is money that in part will find its way back in a small way into our consumer lead economy. It has also seen estate agency stock rise to the news.

The big question however, is what action did the Chancellor take to affect the delivery of the 300,000 homes per annum the government has targeted. The long-term thinking required to fix this ‘broken housing market’ is not compatible with the term in office and it is doubtful that we will ever see anything other than tinkering, posturing and pandering to vested interests.

The backdrop to this budget is quite unlike that of any other we have experienced in recent times and the Chancellor has very little wriggle room.   The Office for Budget Responsibility (OBR) has sharply cut the UK’s growth forecasts with growth predicted to drop to 1.3% by 2020 and to 1.5% by 2021. Whichever way you look at it, Brexit or no Brexit, this is the biggest downgrade in the OBR’s history.  Apparently, we’re looking at the decade of lowest productivity since Napoleon invaded Russia! Clearly, that’s going to impact pay, which, in turn, will widen the affordability gap, both for first-time-buyers and renters.

Beyond the changes to SDLT, there were a few other interesting items:

Introduction of a Strategic Infrastructure Tariff (SIT) in addition to CIL similar to the Mayoral CIL in London which contributes to Crossrail. SIT will be an option available to Combined Authorities and planning joint committees to fund strategic and local infrastructure. SIT viability will be examined in public, but will have developers groaning.

An additional £1.5bn for the Home Building Fund to provide loans specifically for SME developers. This is combined with incentives to Local Authorities to bring forward smaller schemes and £630m through the National Productivity Investment Fund (NPIF). So one could say it’s a coordinated approach.

The announcement that had the biggest impact, at least as far as the FTSE is concerned, is the setting up of a review panel, chaired by Sir Oliver Letwin to investigate the delivery gap between planning permissions and housing completions. The target is to provide an interim report for the Spring statement 2018 and a full report for the following budget. With the prospect of compulsory purchase of undeveloped land, The city took this seriously enough to mark shares in house builders down: Barrett’s fell 3%, Berkeley Homes 2.7% and Persimmon 1.7%. Re-emphasis of Help-to-Buy and the aforementioned SDLT did little to raise the house-builder spirits. The LSE recently debunked received, rather negative wisdom about land-banking, So it’ll be interesting to see if Sir Olive Letwin comes up with anything different. Nevertheless, maybe this is an area that has teeth.  The City thinks so.

Of course a further £10bn of Help-to-Buy was confirmed. That was never, ever in doubt.

Council Housing Revenue Caps are to be lifted for areas of ‘high affordability pressure’; (undefined) and councils will be ‘invited to bid’ for increases. This is to help fund build more council houses. But is this sea change? No.

As one would expect, we got a further examination of the planning system, which is often blamed for both the paucity and sluggishness of supply. Commitments to reform the planning system have been oft mooted but tend to get bogged down when it gets to implementation at local level. Perhaps government are serious this time. However, there’s an awful lot of ‘consultation’ to get through before proposals like an expectation to permission land outside the local plan where the scheme offers a predominance of discounted homes to first-time-buyers become binding. (Green belt excluded. Naturally)

The Green Belt got the usual unequivocal support from Government, but nobody’s convinced:  the CPRE insist encroachment is rampant and that we’re about to lose irreplaceable bucolic loveliness to soulless concrete and steel; whereas developers say it’s the next best thing to kryptonite when it comes to disabling growth.

One very positive step was a £2m competition to support FinTech firms in developing innovative solutions to enable renters to use their history of renting to support and underwrite their credit scores.  This is something the Build-to-Rent industry has been championing for a while and it’s good to see the government recognise the need for such a change.

Innovation in the construction industry is desperately needed with many industry experts citing the necessity to completely change working practices and methods. The government proposes to assist by providing £34m in supporting scaling up of “innovative training models” across the country. Rather too little given the speed at which change is desperately required.

Housing Associations are going to be non-too pleased at the government pressing ahead with a stock depleting £200m large-scale regional pilot of ‘Right-to-Buy’ for tenants in the Midlands.

 

What didn’t we get?

We didn’t get unequivocal acknowledgement that housing targets can only be met by blending public and private resources, and there is still an unhealthy reliance placed upon house-builders to deliver government policy. Naturally, their shareholders think differently.

There was no specific mention of capital funding for social or affordable housing in his speech. Just a reference to October’s announcement of £2bn funding towards affordable home, which it said, is “including funding for social rented homes”.

The Build-to-Rent industry got next to nothing. Consultation arising out of the Housing White Paper grinds its gears whilst there still remains that most glaring of SDLT anomalies where BTR investors are liable for the 3% SDLT surcharge which was meant to curtail BTL investors. The government tacitly acknowledged as much in the 2015-16 consultation where it was expected by the residential investment industry, and initially signalled by government, that they would be exempted from the surcharge. It’s an obvious issue that needs to be addressed with some urgency.

Overall, there was little to get excited about. Pre-budget hype was always going to be just that. Hype. Should the government have done more to recognise the contribution that BTR and the Housing Associations could make towards housing targets if conditions allowed? Yes. Has the Chancellor addressed the ‘Broken housing market?’ No. Not in any great measure. And did we really expect him to? No. The political backdrop is too fractured. We have a government in power but not in control and Brexit is adding an unwelcome layer of uncertainty. Not because we are heading for the exit, but because we don’t know where that exit is, where it leads or when.