Author Archives: Morne Luus

Beyond the Home Hub: The future of Wi-Fi in Build-to-Rent

High-quality internet access is by far and away the number one amenity for occupiers of BTR and student schemes.  Only a few months’ ago, WiredScore, the connectivity rating service, chose to launch its WiredScore Home certificate aimed at build-to-rent landlords, with 4,000 units already under review. 

It comes as no surprise really. I bet I am not the only one returning from this year’s family holiday with the sounds of phrases like these still ringing in my eyes:

  • “Oh no! I’m out of data!”
  • “Can I tether to you?”
  • “Are you hot-spotting?”; and even
  • “We’re not going there unless it has Wi-Fi!”

It’s not just the teenagers either! Good internet connection has become a basic requirement of life for those of us who are used to it.  This latest article, prepared for us by Darren Henwood of Glide, takes a close look at how the provision of best-in-class connectivity is changing for multi-occupier schemes and introduces the idea of Pervasive Wi-Fi.

 

The humble router has been the backbone of home broadband and Wi-Fi delivery for a generation.  As advances in technology and residential living converge, it’s time for a new approach to Wi-Fi and a new philosophy with futuristic experiences for residents and practical benefits for landlords.  

 

Over the last 20 years, we have come to depend on a small black or white box.  In 2019, this device still acts as a modem to connect us to an internet provider. It still performs routing which allows all of our devices to join a network and it still beams Wi-Fi around our homes.  The outdated technology was designed to work in the two-up two-down majority of UK homes and nothing much has changed.

 

Routers are still poorly positioned by Internet Service Providers (ISPs) or naive residents, they still need to be switched off and on again and firmware needs to be upgraded. Wireless performance is limited by interference and building materials and coverage is patchy.  The fixed port is disappearing, plugging devices directly into the router will become defunct and all at a time when people rely on mobile devices and mobile connectivity. 

 

Build-to-Rent is an emerging brand of residential development specifically designed for renting, managed by specialist operators who will look to evolve the provision of resident services like Wi-Fi. In this competitive market, developers and operators need to differentiate their properties to maintain 100% occupancy and profitability.  If people are to abandon the aspiration of owning their own home and commit to a lifestyle of renting, significant improvements to resident services and well-being will be needed to make Build-to-Rent a popular choice.

 

96% of tenants find going without the internet to be the most frustrating part of moving home so we know fast, reliable Wi-Fi is a key technology.

 

The future of Wi-Fi is Managed Pervasive Wi-Fi and represents an alternative approach; one that guarantees coverage over every inch of an apartment and spells the end of the familiar home router.  Pervasive Wi-Fi is invisible, on all of the time and it works, offering significant benefits to both resident and landlord without sacrificing privacy and security.  

 

Smart Home solutions like smart thermostats, smart lighting, smart metering and environmental controls can all be installed before residents move in. Services managed by the landlord but used by the resident with no cumbersome router and now, not just for tech-savvy homeowners but rather installed as standard. This means zero hassle for residents which is the main reason many are considering moving to a Build-to-Rent property.

 

Landlords face similar challenges with outdated building systems and devices for the provision of utilities. What does Pervasive Wi-Fi mean for building services?

 

Pervasive Wi-Fi will extend the reach and range of managed services available to landlords with new tools to efficiently manage properties.  Solutions, like utility sub-meters that automatically and accurately measure consumption and automatically bill residents, introduce a new level of efficiency and fairness.  Centrally managed thermostats mean the heating can be switched off for unoccupied apartments and ambient temperature settings for communal spaces used to maintain the green credentials of the property. Introducing new control systems over Pervasive Wi-Fi will be more cost effective and easier to introduce than traditional infrastructure.  

 

Living in Build-to-Rent is a lifestyle choice. Build-to-Rent should not just deliver spaces to sleep in but environments that enhance the lifestyle of the renter. Pervasive Wi-Fi means connected environments extend beyond the front door to the gym, the cinema room, yoga studio, cafes, parking lot and communal outdoor spaces so there is no limitation on the ambition of landlords to impress prospective residents.  

 

Extending the management of Wi-Fi into apartments and communal spaces means the level of service, coverage and speed is now the responsibility of the managed Wi-Fi provider.  Introducing a standard and benchmarking Wi-Fi coverage ensures service quality comparable with the best performing apartments across a portfolio.  This is analysis that leading operators can draw upon that their competition cannot and with a wider range of landlord services to help find additional cost savings and optimise coverage, the Build-to-Rent proposition continues to significantly differentiate properties from the rest of the residential property market. This added freedom also empowers operators to extract every discernible operational efficiency from their network.

 

What does 5G mean for the future of the Home Hub?

 

5G is the next generation of mobile networks to roll out across the UK, initially in major cities and deployed from a variety of familiar UK providers. 5G will be faster and more reliable, with greater capacity and lower response times. With more speed and capacity comes exciting new consumer and business applications that could replace 3G, 4G or Wi-Fi infrastructure with 5G.  5G driverless cars, remote healthcare, holographic technology, 5G phones and drones may well depend on the 5G technology but is the ambition of replacing Wi-Fi in the home with 5G a reality?

 

Advocates will say 5G will replace expensive fibre broadband infrastructure. This means no need for cables under our streets and into our homes. 5G will be beamed wirelessly into our 5G Home-Hub or wirelessly into our Smart Devices. Residents will deal directly with their 5G provider, likely the same provider as their mobile phone. Landlords of apartment blocks will have a separate 5G commercial agreement to provide for back office services and communal spaces.  Regrettably, 5G providers will face the same challenges as with 3G and 4G. The technology can’t penetrate every building material which means coverage will always be unpredictable.  5G can’t defy physics and the costs to guarantee the same coverage as Wi-Fi massively outweigh the benefits.

 

Mobile data is by some margin the most expensive. Residents will depend on 5G data services being available and deliver capacity to a range of increasingly bandwidth hungry devices like Ultra High Definition (UHD) streaming and online gaming. In the current market, the best residential 5G deals are approximately £75 for 100GB per month.  It’s possible that this would suffice for a typical online gamer but the comparable fibre services are uncapped, significantly more affordable and reliable and future-proof for the next generation of technology.

 

5G is fantastic technology but the rollout will be staggered. 5G will not provide as much resilience and no redundancy and will neither be as reliable or future-proof to meet the raising popularity of gigabit fibre broadband. This makes running critical building systems on 5G a risk and limits the appeal of a rental property to the next generation of renters.  

 

Every 5 years the headline speed offered by leading residential broadband ISPs goes up by a factor of 10. Significantly, 100GBs of capped data usage will last 13 minutes on a capped gigabit product. Replacing the fixed asset Wi-Fi infrastructure with 5G mobile data for a portfolio of properties would significantly increase the operating cost of the buildings. If you are investing or operating in a 25-year property asset why would you put in anything else other than fibre?

 

What does Wi-Fi 6 mean for the future of the Home Hub?

 

Wi-Fi 6 or 802.11ax Wi-Fi is the sixth generation and standard of Wi-Fi technology designed to support four times more devices on a crowded network and a wider Wi-Fi channel that will make Wi-Fi faster. 5G and Wi-Fi 6 are built on the same technology so all the benefits that 5G promises are already available at a fraction of the cost. 

 

Home broadband providers are already promising gigabit services to every home in just a few years.  Fibre broadband has unlimited capacity and is future-proof for at least the next 25 years so will support this evolution. Comparatively, the cost profile of 5G data services will be too much for a typical user afford.  For the majority, all roads lead to fibre broadband and Pervasive Wi-Fi as a common-sense solution.  Don’t believe the 5G hype.

 

Geraghty Taylor has appreciated that internet connectivity is the number one amenity service for BTR since we first started designing schemes. The WiredScore rating is a welcome independent review for occupiers and investors alike.  It is crucial to keep on top of rapid technology changes and design buildings than can accommodate future advances.

 

Create differently

 

#BTR #BuildtoRent #Brand #Brandbeforebuilding

 

Our thanks to the Glide Group team for preparing this review.  If you have any questions relating to the article please get in touch with Darren Henwood

BTR Ecosystems Part II

Last week, in Part 1 of this two-part series, we talked about the ecosystems within the overall Private Rented Sector market place.  This week we take a look at the business ecosystems that operate within a larger BTR scheme. Many operators now see the minimum size of a BTR scheme as well above 150 units. Moreover, they would prefer schemes of 500 units and above. In the States it is not uncommon to see buildings with in excess of 1,000 units. In the UK, complexes like East Village and Wembley Park now boast more than 3,000 residences.

 

The sheer number of occupiers, all on individual leases, inevitably means that there will be a spread of rents achieved, on similarly configured units, due to timing of letting and market conditions, even within the same building or complex. What kind of spread should an operator look for?

 

Voids are a necessary lubricant for growth

 

In any scheme or village, there will be a number of voids or vacant units. Conventional wisdom says that the manager should minimise these but more experienced operators appreciate that these represent the oil in the machine that gives the opportunity to continually refresh the units and set new rental highs, improving the general rental “tone” of the building. In addition, there are new businesses like Staykeepers and Lavanda who offer to actively manage very short term rentals at premium rents using accommodation platforms like Airbnb and Bookings.com. This can be on behalf of the operator or, indeed, on behalf of the resident with the operator's consent. This adds another dimension to a part of the BTR schemes rental offering. At the other end of the scale, there may also be longer leases which sit at lower rental levels for some time but which can have a positive impact on the overall risk profile.

 

So management becomes a balancing act and the profile of rents across the scheme or estate will resemble the spectrum of rents across the market that we saw last week. But there will be a normal or stabilised rent which will predominate and set the tone for the scheme. Around this there will be some who are benefiting from lower rents and some who are sitting at higher levels. 

 

How much of your scheme should sit at the normal or “stabilised” rent?

 

Multifamily operators in the States are quite willing to accept a void rate in a scheme in excess of 5% of total units in order to refresh, renew and set new rental levels. They are also comfortable to have only 60% to 70% of their occupiers paying the stabilised rental level. Much more than this and they start to feel that they are undervaluing their asset; much less than this and they worry that they are overvaluing the accommodation and that they risk losing occupiers if the market moves against them.

 

One multifamily operator in the States who achieves these thresholds gave us a very good insight to the profile of his occupiers. In his experience, he would normally expect to want to actively get rid of some 10% of his occupiers at any point in time because they were proving troublesome in one way or another. At the other end of the scale, he would describe 30% of his residence as “Happy as Larry” and likely to stay under most reasonable circumstances. Inevitably, another 30% would be looking to move but due to changes in their own life-circumstances like job changes, marriage or new or growing children. This leaves the remaining 30% being the floating occupiers who would consider moving on purely financial or opportunistic grounds. It is these floating residents that the operator has to be acutely aware of in any rent renegotiations.

 

 

 

Maybe we aren’t dealing with a simple demand curve...

 

Let’s get technical for a moment.  A normal demand curve would suggest that price changes would have a different impact on the number of lettings depending on the level of rents.  A small price change at the high end of the rent scale has a far more dramatic impact on occupancy levels than it would have at the low end.  However, we see there is a degree of price inelasticity in the BTR model. The residents are not just simple price takers. They will not automatically move to the next most appropriate scheme if it offers a slightly better price. They have to vote with their feet and there are sunken costs representing the expense and hassle of moving. In this case, a price change may have less impact at certain points and as it affects our different resident groups and so we may not have a smooth curve.

 

It may be that we have a graph with two distinct sectors with price changes impacting substantially differently at different rent levels.  The break-point could well be around the stabilised level.

 

 

 

 

Occupiers, in the States at least, seem generally comfortable accepting small rent rises on renewal

This operator's experience over time has shown him, anecdotally, that price changes of less than 8% do not tend to result in an exodus of many sitting residents. More limited increases of inflation plus a percent or two are usually quite acceptable to the majority.

Investors have criticised scheme promoters in the UK in the past for suggesting that there will be continual rental growth in the sector to support its otherwise low initial yield. This evidence from the States seems to suggest there may be some support for projections that anticipate a low level of sustained rental increase in the long term; with obvious cycles given market dynamics.

 

We would all benefit from shared information

 

As a young market, BTR information is very much in the hands of the operators and pretty jealously guarded.   It would be nice to think that drawing on experiences in the other sectors; we might see some pooling of non-sensitive information for the benefit and growth of the market generally.

 

  • What are the market void rates and how do they vary across schemes?
  • What percentage of BTR is reserved for ultra short-term lets?
  • How many operators are prepared to allow residents to short-let their units and how?
  • How do we assess the “stabilised” rent?
  • What is the lease length profile of the market and how is it changing?

 

All these features would add to our understanding and help with setting strategies for individual schemes.  Ultimately, the industry also needs information on the cost side as well to help answer the inevitable question of what is the gross to net leakage.

 

These last two papers have shown that BTR is far from a simple market with a standard product renting for a similar price.  There are complex ecosystems at the macro level across the market and also at the micro level within schemes themselves.  Better understanding of these systems will lead to happy customers, successful operators and a more effective market.

 

Geraghty Taylor.

 

Create differently

 

#BTR #BuildtoRent #Brand #Brandbeforebuilding

Last week, in Part 1 of this two-part series, we talked about the ecosystems within the overall Private Rented Sector market place.  This week we take a look at the business ecosystems that operate within a larger BTR scheme. Many operators now see the minimum size of a BTR scheme as well above 150 units. Moreover, they would prefer schemes of 500 units and above. In the States it is not uncommon to see buildings with in excess of 1,000 units. In the UK, complexes like East Village and Wembley Park now boast more than 3,000 residences.

 

The sheer number of occupiers, all on individual leases, inevitably means that there will be a spread of rents achieved, on similarly configured units, due to timing of letting and market conditions, even within the same building or complex. What kind of spread should an operator look for?

 

Voids are a necessary lubricant for growth

 

In any scheme or village, there will be a number of voids or vacant units. Conventional wisdom says that the manager should minimise these but more experienced operators appreciate that these represent the oil in the machine that gives the opportunity to continually refresh the units and set new rental highs, improving the general rental “tone” of the building. In addition, there are new businesses like Staykeepers and Lavanda who offer to actively manage very short term rentals at premium rents using accommodation platforms like Airbnb and Bookings.com. This can be on behalf of the operator or, indeed, on behalf of the resident with the operator's consent. This adds another dimension to a part of the BTR schemes rental offering. At the other end of the scale, there may also be longer leases which sit at lower rental levels for some time but which can have a positive impact on the overall risk profile.

 

So management becomes a balancing act and the profile of rents across the scheme or estate will resemble the spectrum of rents across the market that we saw last week. But there will be a normal or stabilised rent which will predominate and set the tone for the scheme. Around this there will be some who are benefiting from lower rents and some who are sitting at higher levels. 

 

How much of your scheme should sit at the normal or “stabilised” rent?

 

Multifamily operators in the States are quite willing to accept a void rate in a scheme in excess of 5% of total units in order to refresh, renew and set new rental levels. They are also comfortable to have only 60% to 70% of their occupiers paying the stabilised rental level. Much more than this and they start to feel that they are undervaluing their asset; much less than this and they worry that they are overvaluing the accommodation and that they risk losing occupiers if the market moves against them.

 

One multifamily operator in the States who achieves these thresholds gave us a very good insight to the profile of his occupiers. In his experience, he would normally expect to want to actively get rid of some 10% of his occupiers at any point in time because they were proving troublesome in one way or another. At the other end of the scale, he would describe 30% of his residence as “Happy as Larry” and likely to stay under most reasonable circumstances. Inevitably, another 30% would be looking to move but due to changes in their own life-circumstances like job changes, marriage or new or growing children. This leaves the remaining 30% being the floating occupiers who would consider moving on purely financial or opportunistic grounds. It is these floating residents that the operator has to be acutely aware of in any rent renegotiations.

 

 

 

Maybe we aren’t dealing with a simple demand curve...

 

Let’s get technical for a moment.  A normal demand curve would suggest that price changes would have a different impact on the number of lettings depending on the level of rents.  A small price change at the high end of the rent scale has a far more dramatic impact on occupancy levels than it would have at the low end.  However, we see there is a degree of price inelasticity in the BTR model. The residents are not just simple price takers. They will not automatically move to the next most appropriate scheme if it offers a slightly better price. They have to vote with their feet and there are sunken costs representing the expense and hassle of moving. In this case, a price change may have less impact at certain points and as it affects our different resident groups and so we may not have a smooth curve.

 

It may be that we have a graph with two distinct sectors with price changes impacting substantially differently at different rent levels.  The break-point could well be around the stabilised level.

 

 

 

 

Occupiers, in the States at least, seem generally comfortable accepting small rent rises on renewal

This operator's experience over time has shown him, anecdotally, that price changes of less than 8% do not tend to result in an exodus of many sitting residents. More limited increases of inflation plus a percent or two are usually quite acceptable to the majority.

Investors have criticised scheme promoters in the UK in the past for suggesting that there will be continual rental growth in the sector to support its otherwise low initial yield. This evidence from the States seems to suggest there may be some support for projections that anticipate a low level of sustained rental increase in the long term; with obvious cycles given market dynamics.

 

We would all benefit from shared information

 

As a young market, BTR information is very much in the hands of the operators and pretty jealously guarded.   It would be nice to think that drawing on experiences in the other sectors; we might see some pooling of non-sensitive information for the benefit and growth of the market generally.

 

  • What are the market void rates and how do they vary across schemes?
  • What percentage of BTR is reserved for ultra short-term lets?
  • How many operators are prepared to allow residents to short-let their units and how?
  • How do we assess the “stabilised” rent?
  • What is the lease length profile of the market and how is it changing?

 

All these features would add to our understanding and help with setting strategies for individual schemes.  Ultimately, the industry also needs information on the cost side as well to help answer the inevitable question of what is the gross to net leakage.

 

These last two papers have shown that BTR is far from a simple market with a standard product renting for a similar price.  There are complex ecosystems at the macro level across the market and also at the micro level within schemes themselves.  Better understanding of these systems will lead to happy customers, successful operators and a more effective market.

 

Geraghty Taylor.

 

Create differently

 

#BTR #BuildtoRent #Brand #Brandbeforebuilding

BTR Ecosystems

 

 

Newcomers to the build to rent market could be forgiven for thinking that BTR relates purely to high-end luxury rented residential with all the bells and whistles, in fancy uptown locations. Will BTR define its own range and will this have a limited price spread?  We believe not. Our view at Geraghty Taylor is that BTR will increasingly offer quality rented accommodation across the broad spectrum of rented residential price points. In this review we take a close look at the rental market in a major London suburb.

 

Dataloft provide us with comprehensive data on Stratford

 

In conjunction with residential market analysts, Dataloft, we have taken a very close look at one local London market to see if we can identify any patterns in pricing.  Dataloft has produced comprehensive rental data for the Stratford market drawing upon more than 300 new tenancies agreed in the last year.  The properties involved ranged from studios to 5 bedroom properties.

 

The average rent across these rentals was £1,490 per month, equating to just short of £18,000 a year. 

 

 

 

 

Let’s look at the spread of market rents

 

We then tried to improve upon the headline averages by breaking down the data into price bands (using £’s per month) to help build a distribution graph of rents in the area and give a better indication of the broad spectrum of rental activity in the Stratford market.

 

The chart below present the data for both Stratford (referred to as the “Catchment”) and the wider local area of the London Borough of Newham (referred to as the “Benchmark”).  We see that there is a very wide range of prices being paid, ranging from below £500 a month to above £3,750. The most active band was in the range of £1,250 to £1,500 per month.  

 

 

 

 

Clearly, the number of rooms is an important factor

 

...but not as much as you may think!  The average rent for smaller lettings involving studios and one bedroom flats sits, unsurprisingly, below the average for the full sample.  However, the cost of each additional room appears to be far less significant than the high basic cost for having a “bolt-hole” in Stratford.  The chart shows the results:

 

 

 

This looks a lot like the theory.... but there is more to it

 

It is quite pleasing to see that reality actually resembles the statistical “distribution” curves we all endured in maths lessons!   When we were thinking about this paper we proposed a theoretical model which anticipated this broad distribution of rents but realised it would result from the interaction of specific market ecosystems or subsets of rental types, such as RSL’s   (Registered Social Landlords), HMO’s (Houses of Multiple Occupation) and PRS generally, as well as BTR, each with their own distribution and predominating in a particular price point range.  Here is our initial sketch.

 

 

 

 

What underlies the ecosystem?

 

There simply isn’t the data available to definitively recreate this initial sketch in its entirety from fact but Dataloft have given us the Total market line and, within this, we have worked with the information we can obtain to improve upon our initial thoughts to create a plausible breakdown of the market.  Probably the most surprising result was that the BTR curve was much more widely spread across price points. Take a look.

 

 

 

 

 

Across the market, generally, there is a view that the early BTR offerings are in the upper quartile of prices.  But our review of Stratford, which is one of the most mature BTR markets, shows that BTR is available across the price spectrum. Increasingly, new entrants to the market are pitching in at all points along the curve with a number offering product at the more affordable end.  For instance, in Greenford, Network Homes have just completed “The Big Blue” offering 270 BTR-style units, while charging only 80% of local private rents.

 

Network Homes and L&Q are examples of Housing Associations entering the BTR market.  Given their history, they will undoubtedly bring yet another dimension to the market. And don’t forget the arrival of Blackstone in the affordable housing arena with Sage Housing.

 

How are the major players positioning?

 

We have stuck our neck out a bit by creating this figurative representation of where leading BTR companies might already be positioned on the price point curve.  This will, of course, vary with particular schemes and we apologise if anyone feels inappropriately placed; this is a purely indicative exercise.  We also appreciate that there are operators who already have both luxury and economy brands within their overall stable but it is provided to demonstrate that there is already a diversity.

 

 

 

At the high end of the scale, Essential Living deliver "premium apartments to rent in connected locations" and Moda Living aim to "create the UK's leading lifestyle experience brand", both companies offering high end quality and luxury amenity.   However, Curlew Communities and Rise Homes are both aiming to deliver accommodation at around the level of affordable rents.  Fizzy Living has been providing good quality accommodation focused on value for money locations. Its pitch reads "quality flats to rent in secure buildings across London".  We expect to see BTR offerings throughout the price point spectrum.

 

 

Remember, that at all price points, the killer amenity for BTR is simply quality service. This makes BTR as distinct from PRS generally as logistics warehouses are from manufacturing industrial units. So we would expect it to show some price premium at each level. Studies from JLL and Colliers have already shown that, at the aggregate level, this can be as much as 9% above the rate for comparable PRS stock.

 

This all demonstrates that rented residential accommodation is a complex ecosystem that any valuer, developer or investor needs to fully understand to get the most from a BTR investment.

 

Thank you Dataloft

 

Our thanks go to Sandra Jones and Julia Middleton at Dataloft for their help in preparing this piece.

 

 

Newcomers to the build to rent market could be forgiven for thinking that BTR relates purely to high-end luxury rented residential with all the bells and whistles, in fancy uptown locations. Will BTR define its own range and will this have a limited price spread?  We believe not. Our view at Geraghty Taylor is that BTR will increasingly offer quality rented accommodation across the broad spectrum of rented residential price points. In this review we take a close look at the rental market in a major London suburb.

 

Dataloft provide us with comprehensive data on Stratford

 

In conjunction with residential market analysts, Dataloft, we have taken a very close look at one local London market to see if we can identify any patterns in pricing.  Dataloft has produced comprehensive rental data for the Stratford market drawing upon more than 300 new tenancies agreed in the last year.  The properties involved ranged from studios to 5 bedroom properties.

 

The average rent across these rentals was £1,490 per month, equating to just short of £18,000 a year. 

 

 

 

Please click on these images to expand! 

 

Let’s look at the spread of market rents

 

We then tried to improve upon the headline averages by breaking down the data into price bands (using £’s per month) to help build a distribution graph of rents in the area and give a better indication of the broad spectrum of rental activity in the Stratford market.

 

The chart below present the data for both Stratford (referred to as the “Catchment”) and the wider local area of the London Borough of Newham (referred to as the “Benchmark”).  We see that there is a very wide range of prices being paid, ranging from below £500 a month to above £3,750. The most active band was in the range of £1,250 to £1,500 per month.  

 

 

Please click on these images to expand! 

 

Clearly, the number of rooms is an important factor

 

...but not as much as you may think!  The average rent for smaller lettings involving studios and one bedroom flats sits, unsurprisingly, below the average for the full sample.  However, the cost of each additional room appears to be far less significant than the high basic cost for having a “bolt-hole” in Stratford.  The chart shows the results:

 

Please click on these images to expand! 

 

This looks a lot like the theory.... but there is more to it

 

It is quite pleasing to see that reality actually resembles the statistical “distribution” curves we all endured in maths lessons!   When we were thinking about this paper we proposed a theoretical model which anticipated this broad distribution of rents but realised it would result from the interaction of specific market ecosystems or subsets of rental types, such as RSL’s   (Registered Social Landlords), HMO’s (Houses of Multiple Occupation) and PRS generally, as well as BTR, each with their own distribution and predominating in a particular price point range.  Here is our initial sketch.

 


Please click on these images to expand! 

 

What underlies the ecosystem?

 

There simply isn’t the data available to definitively recreate this initial sketch in its entirety from fact but Dataloft have given us the Total market line and, within this, we have worked with the information we can obtain to improve upon our initial thoughts to create a plausible breakdown of the market.  Probably the most surprising result was that the BTR curve was much more widely spread across price points. Take a look.

 

 

Please click on these images to expand! 

 

Across the market, generally, there is a view that the early BTR offerings are in the upper quartile of prices.  But our review of Stratford, which is one of the most mature BTR markets, shows that BTR is available across the price spectrum. Increasingly, new entrants to the market are pitching in at all points along the curve with a number offering product at the more affordable end.  For instance, in Greenford, Network Homes have just completed “The Big Blue” offering 270 BTR-style units, while charging only 80% of local private rents.

 

Network Homes and L&Q are examples of Housing Associations entering the BTR market.  Given their history, they will undoubtedly bring yet another dimension to the market. And don’t forget the arrival of Blackstone in the affordable housing arena with Sage Housing.

 

How are the major players positioning?

 

We have stuck our neck out a bit by creating this figurative representation of where leading BTR companies might already be positioned on the price point curve.  This will, of course, vary with particular schemes and we apologise if anyone feels inappropriately placed; this is a purely indicative exercise.  We also appreciate that there are operators who already have both luxury and economy brands within their overall stable but it is provided to demonstrate that there is already a diversity.

 

 

 

 

 

Please click on these images to expand! 

At the high end of the scale, Essential Living deliver "premium apartments to rent in connected locations" and Moda Living aim to "create the UK's leading lifestyle experience brand", both companies offering high end quality and luxury amenity.   However, Curlew Communities and Rise Homes are both aiming to deliver accommodation at around the level of affordable rents.  Fizzy Living has been providing good quality accommodation focused on value for money locations. Its pitch reads "quality flats to rent in secure buildings across London".  We expect to see BTR offerings throughout the price point spectrum.

 

Remember, that at all price points, the killer amenity for BTR is simply quality service. This makes BTR as distinct from PRS generally as logistics warehouses are from manufacturing industrial units. So we would expect it to show some price premium at each level. Studies from JLL and Colliers have already shown that, at the aggregate level, this can be as much as 9% above the rate for comparable PRS stock.

 

This all demonstrates that rented residential accommodation is a complex ecosystem that any valuer, developer or investor needs to fully understand to get the most from a BTR investment.

 

Thank you Dataloft

 

Our thanks go to Sandra Jones and Julia Middleton at Dataloft for their help in preparing this piece.

 

 

Will BTR modernise residential construction?

The customer-focused culture of BTR is challenging us to rethink the rental market; now it looks set to disrupt residential construction and modernise its delivery. Offsite assembly suits the high quality and rapid deployment requirements of Build to Rent. An increasing number of new BTR developers are exploring the offsite route and some are lucky enough to secure supply in a somewhat low capacity market.

 

Major players like Greystar are bringing forward schemes in Croydon and Greenford which involve the delivery and assembly of thousands of modular units.  So is this the way forward? The approach suggests a shift towards vertical integration with greater control of the design and delivery of the product being sought by experienced BTR players. The benefits are better product quality, predictability and supply chain control, which together can help to reduce cost and risk. BUT it is not always as easy as aligning design and procurement. When developers approach their investor’s investment committee or their bank for construction funding, they are met with questions about:

  • the procurement risk of tying their product delivery to the output of a single supplier
  • the risk, in a restricted market, that the product supply might not be picked up by a new supplier in the event of the corporate failure of the original off-site manufacturer....and that the scheme has to start again from scratch
  • the problem that these considerations pose to obtaining contract  insurance for the build contract at all; and
  • the fact that the industry's own efforts with BOPAS accreditation has only resulted in some 70 accredited businesses so far.

 

And so, all too often, the developer opts for a traditional build... and the off-site industry misses out on revenue that could help it expand to meet the growing demand. However this is not always the case, and despite some of the risks, progressive BTR companies recognise that in building a BTR portfolio, it needs to adopt different approaches to design and procurement.

 

Just this month, legal experts, Trowers Hamlin released a collaborative report entitled “Funding Barriers to offsite housing – Separating fact from fiction”.  They conclude that there is no reason why appropriately delivered offsite should be treated any less favorably than traditionally built homes for the purpose of charging.  They should not be viewed as depreciating assets. Indeed, there is evidence that manufactured homes represent an opportunity to achieve a design life that exceeds that of traditionally built homes. But traditional approaches to performance security must adapt to allow for the specific features of offsiting to deliver confidence.

 

Shaun Grainger of PIB Insurance Brokers has some very interesting comments about his company’s proactive approach to underwriting offsite construction. Ultimately, this is the key to securing the necessary construction and investment funding.

 

Our take on his view can foresee a world where insurance premiums are actually lower for offsite construction because the insurer is underwriting a “product” that is itself already BOPAS accredited, reducing costly on-site inspecting.  Greater control and clarity should reduce claims but to get there the industry must tackle specific concerns of safety and durability in use and added risks like those in transportation. 

 

Let’s set the scene by looking at the recent development of the off-site industry.

 

Like every market innovation new names and definitions abound; so you will hear Offsite Construction, Design for Manufacture and Assembly (DfMA) and Modern Methods of Construction (MMC) used pretty interchangeably.  The whole industry is not as recent as you may think.  In reality, it has had a long and laboured development. Early work was done in the late 1990’s which led to the “Rethinking Construction report” - often referred to as the Egan report.  Interest, most recently, has been crystallised by Mark Farmer’s review of the construction labour market in the UK for the Ministry of Housing, Communities & Local Government (MHCLG), known as, “Modernise or Die”.  This has found widespread resonance in an industry struggling with mistrust, poor value, poor delivery and poor quality, along with a legendary inability to meet program or budget.  The house building industry today, for instance, is required to increase output by 50% just to meet Government targets, but set this against a backdrop of a workforce forecast to decrease by 25% to 2026.  We currently aren’t growing new builders!

 

Offsite finds a new champion

 

Offsite at its simplest, is a system which is based on a kit of parts, produced in a factory environment, with the aim to assemble this high quality product quickly and efficiently on site.  The process has found favour already with sectors that have a very repeatable product like the hotel and student accommodation industries.  There are many solutions ranging from full volumetric modular which literally allows you to crane in a room to more componentised solutions.  The MHCLG released its “MMC definition framework” in March which gives a very helpful introduction to the entire spectrum. See below:

 

 

BTR schemes aspire to high quality and robustness in the longer term and they have significant levels of repetition with relatively small variations between unit types on offer. This aligns with brand placement, volume production, predictably and the capacity to quickly turn capital into revenue.  To do this, systems must be standardised across schemes to maximise buying power and minimise maintenance costs, delivering Facilities Management efficiency.  Offsite seems to have found its new champion; look at these key matches:

 

 

Production: as with any mass produced items, once you have set your production line up, you want it running with minimum disruption at ‘full tilt’; you want your systems, assemblies and finishes to be standardised and efficient - just as you would with BTR - and you want that speed of output-to-site to allow the capital investment to generate income quickly.

 

Risk management: Once the system is created and tested, the risk so prevalent with traditional construction - where every scheme is a prototype - is virtually eliminated. If it worked under test on one scheme, with equivalent parameters there is no reason for it not to work on the next, or the one after that...

 

Longevity: The use of repetitive, tested detailing and predictable servicing means that you know exactly how and where to maintain the building; you can be assured that the traditional construction industry’s penchant for making it up as you go has been avoided... in effect you have taken your building away from a poorly supervised site environment into a managed, safe, supervised environment in a factory where Quality Assurance can be rigorous and continuous. Further supporting this is the BOPAS scheme, led by major insurers, the OffSite industry and other key stakeholders which provides surety of quality, longevity and production quality.

 

Design quality: No one wants boring buildings, or repetitious “prefabs” so most schemes are hybridised to a greater or lesser extent, allowing different systems to exploit their key benefits, delivering exciting, good looking buildings which reflect the brand and quality of their owners. 

 

Once the strategic decision to use off-siting has been made, we at Geraghty Taylor focus on product definition, appropriate standardisation and supply chain management.  We look to design the Mods, Pods and Cogs  (room modules, pod components like kitchens and bathrooms and micro components like utility cupboards) that will fit together to create the building.

 

Leading to a new generation of construction employment

 

The move to factory based production brings with it some key advantages for growth.  The appeal of this environment over the cold, wet, site-based employment of traditional build is clear.  It can appeal to a wider cross section of employees, both by age and gender.  It is also digitally empowered so can literally “key” into the career aspirations of the young.  You might be interested to know that both Lego and IKEA are looking to “disrupt” in this space.

 

BUT managing a growth path is not without its difficulties.  The UK market is dominated by a handful of systems and capacity to deliver at peak has been questioned.  Securing your supply can very quickly be difficult in strong markets where there are insufficient “fall-back” suppliers of sufficient quality.

 

The quality point is important, as the “prefab” of old carried with it concerns about robustness and finance, which, in the form of mortgages, was often limited.  Insurers are asking ‘Will these buildings last’?  The industry is convinced they will and has created its own accreditation system; BOPAS.  This is a risk-based evaluation which demonstrates that homes built from non-traditional methods & materials will stand the test of time for at least 60 years.  But there are currently fewer than 70 BOPAS accredited operations and when you see the reduced options available for building at height, you can appreciate why insurers worry that the developers are placing a lot of risk with one supplier.  But isn’t this just the same as a contract with a traditional main contractor over whom you have little real control.

To address this, volume consumers are developing their own systems like L&G’s  and large international developers are simply extending their supply routes from their existing domestic or international procurement centres into the UK.  Geraghty Taylor has just completed a full modular design plan for a major client wanting to adapt their own domestic model to the UK, or you could say design “British multifamily”.  They will look to deploy 10,000 units over the next 5 years or so and achieve substantial cost savings due to the volume.

 

It is clear that the Government have identified the need to support and encourage the sector.  There are grants and funding available and the initiatives of the MHCLG through the Construction Leadership Council are invaluable.

 

 Buildoffsite is an organisation set up to promote the adoption of offsite solutions. It’s membership include Developers, Contractors, Consultants and Suppliers and it is an excellent source of information for all aspects of offsite strategies and technical solutions.  Their recently created BTR group aims to promote offsite solutions specifically to the BTR industry. 

 

It is generally accepted that Construction needs to be modernised and this process is already underway. There are going to be challenges along the way, but  BTR presents a significant opportunity for our new sector to drive meaningful, technology-rich change into the construction industry through offsite solutions. To be successful all parties will need to co-operate to ensure delivery of the bright ambitions of BTR.

 

Offsite thinking is in Geraghty Taylor’s DNA and we always design with offsite in mind.

 

Geraghty Taylor. Create differently

 

 

#BTR #BuildtoRent #Brand #Brandbeforebuilding

The customer-focused culture of BTR is challenging us to rethink the rental market; now it looks set to disrupt residential construction and modernise its delivery. Offsite assembly suits the high quality and rapid deployment requirements of Build to Rent. An increasing number of new BTR developers are exploring the offsite route and some are lucky enough to secure supply in a somewhat low capacity market.

 

Major players like Greystar are bringing forward schemes in Croydon and Greenford which involve the delivery and assembly of thousands of modular units.  So is this the way forward? The approach suggests a shift towards vertical integration with greater control of the design and delivery of the product being sought by experienced BTR players. The benefits are better product quality, predictability and supply chain control, which together can help to reduce cost and risk. BUT it is not always as easy as aligning design and procurement. When developers approach their investor’s investment committee or their bank for construction funding, they are met with questions about:

  • the procurement risk of tying their product delivery to the output of a single supplier
  • the risk, in a restricted market, that the product supply might not be picked up by a new supplier in the event of the corporate failure of the original off-site manufacturer....and that the scheme has to start again from scratch
  • the problem that these considerations pose to obtaining contract  insurance for the build contract at all; and
  • the fact that the industry's own efforts with BOPAS accreditation has only resulted in some 70 accredited businesses so far.

 

And so, all too often, the developer opts for a traditional build... and the off-site industry misses out on revenue that could help it expand to meet the growing demand. However this is not always the case, and despite some of the risks, progressive BTR companies recognise that in building a BTR portfolio, it needs to adopt different approaches to design and procurement.

 

Just this month, legal experts, Trowers Hamlin released a collaborative report entitled “Funding Barriers to offsite housing – Separating fact from fiction”.  They conclude that there is no reason why appropriately delivered offsite should be treated any less favorably than traditionally built homes for the purpose of charging.  They should not be viewed as depreciating assets. Indeed, there is evidence that manufactured homes represent an opportunity to achieve a design life that exceeds that of traditionally built homes. But traditional approaches to performance security must adapt to allow for the specific features of offsiting to deliver confidence.

 

Shaun Grainger of PIB Insurance Brokers has some very interesting comments about his company’s proactive approach to underwriting offsite construction. Ultimately, this is the key to securing the necessary construction and investment funding.

 

Our take on his view can foresee a world where insurance premiums are actually lower for offsite construction because the insurer is underwriting a “product” that is itself already BOPAS accredited, reducing costly on-site inspecting.  Greater control and clarity should reduce claims but to get there the industry must tackle specific concerns of safety and durability in use and added risks like those in transportation. 

 

Let’s set the scene by looking at the recent development of the off-site industry.

 

Like every market innovation new names and definitions abound; so you will hear Offsite Construction, Design for Manufacture and Assembly (DfMA) and Modern Methods of Construction (MMC) used pretty interchangeably.  The whole industry is not as recent as you may think.  In reality, it has had a long and laboured development. Early work was done in the late 1990’s which led to the “Rethinking Construction report” - often referred to as the Egan report.  Interest, most recently, has been crystallised by Mark Farmer’s review of the construction labour market in the UK for the Ministry of Housing, Communities & Local Government (MHCLG), known as, “Modernise or Die”.  This has found widespread resonance in an industry struggling with mistrust, poor value, poor delivery and poor quality, along with a legendary inability to meet program or budget.  The house building industry today, for instance, is required to increase output by 50% just to meet Government targets, but set this against a backdrop of a workforce forecast to decrease by 25% to 2026.  We currently aren’t growing new builders!

 

Offsite finds a new champion

 

Offsite at its simplest, is a system which is based on a kit of parts, produced in a factory environment, with the aim to assemble this high quality product quickly and efficiently on site.  The process has found favour already with sectors that have a very repeatable product like the hotel and student accommodation industries.  There are many solutions ranging from full volumetric modular which literally allows you to crane in a room to more componentised solutions.  The MHCLG released its “MMC definition framework” in March which gives a very helpful introduction to the entire spectrum. See below:

 

 

BTR schemes aspire to high quality and robustness in the longer term and they have significant levels of repetition with relatively small variations between unit types on offer. This aligns with brand placement, volume production, predictably and the capacity to quickly turn capital into revenue.  To do this, systems must be standardised across schemes to maximise buying power and minimise maintenance costs, delivering Facilities Management efficiency.  Offsite seems to have found its new champion; look at these key matches:

 

 

Production: as with any mass produced items, once you have set your production line up, you want it running with minimum disruption at ‘full tilt’; you want your systems, assemblies and finishes to be standardised and efficient - just as you would with BTR - and you want that speed of output-to-site to allow the capital investment to generate income quickly.

 

Risk management: Once the system is created and tested, the risk so prevalent with traditional construction - where every scheme is a prototype - is virtually eliminated. If it worked under test on one scheme, with equivalent parameters there is no reason for it not to work on the next, or the one after that...

 

Longevity: The use of repetitive, tested detailing and predictable servicing means that you know exactly how and where to maintain the building; you can be assured that the traditional construction industry’s penchant for making it up as you go has been avoided... in effect you have taken your building away from a poorly supervised site environment into a managed, safe, supervised environment in a factory where Quality Assurance can be rigorous and continuous. Further supporting this is the BOPAS scheme, led by major insurers, the OffSite industry and other key stakeholders which provides surety of quality, longevity and production quality.

 

Design quality: No one wants boring buildings, or repetitious “prefabs” so most schemes are hybridised to a greater or lesser extent, allowing different systems to exploit their key benefits, delivering exciting, good looking buildings which reflect the brand and quality of their owners. 

 

Once the strategic decision to use off-siting has been made, we at Geraghty Taylor focus on product definition, appropriate standardisation and supply chain management.  We look to design the Mods, Pods and Cogs  (room modules, pod components like kitchens and bathrooms and micro components like utility cupboards) that will fit together to create the building.

 

Leading to a new generation of construction employment

 

The move to factory based production brings with it some key advantages for growth.  The appeal of this environment over the cold, wet, site-based employment of traditional build is clear.  It can appeal to a wider cross section of employees, both by age and gender.  It is also digitally empowered so can literally “key” into the career aspirations of the young.  You might be interested to know that both Lego and IKEA are looking to “disrupt” in this space.

 

BUT managing a growth path is not without its difficulties.  The UK market is dominated by a handful of systems and capacity to deliver at peak has been questioned.  Securing your supply can very quickly be difficult in strong markets where there are insufficient “fall-back” suppliers of sufficient quality.

 

The quality point is important, as the “prefab” of old carried with it concerns about robustness and finance, which, in the form of mortgages, was often limited.  Insurers are asking ‘Will these buildings last’?  The industry is convinced they will and has created its own accreditation system; BOPAS.  This is a risk-based evaluation which demonstrates that homes built from non-traditional methods & materials will stand the test of time for at least 60 years.  But there are currently fewer than 70 BOPAS accredited operations and when you see the reduced options available for building at height, you can appreciate why insurers worry that the developers are placing a lot of risk with one supplier.  But isn’t this just the same as a contract with a traditional main contractor over whom you have little real control.

To address this, volume consumers are developing their own systems like L&G’s  and large international developers are simply extending their supply routes from their existing domestic or international procurement centres into the UK.  Geraghty Taylor has just completed a full modular design plan for a major client wanting to adapt their own domestic model to the UK, or you could say design “British multifamily”.  They will look to deploy 10,000 units over the next 5 years or so and achieve substantial cost savings due to the volume.

 

It is clear that the Government have identified the need to support and encourage the sector.  There are grants and funding available and the initiatives of the MHCLG through the Construction Leadership Council are invaluable.

 

 Buildoffsite is an organisation set up to promote the adoption of offsite solutions. It’s membership include Developers, Contractors, Consultants and Suppliers and it is an excellent source of information for all aspects of offsite strategies and technical solutions.  Their recently created BTR group aims to promote offsite solutions specifically to the BTR industry. 

 

It is generally accepted that Construction needs to be modernised and this process is already underway. There are going to be challenges along the way, but  BTR presents a significant opportunity for our new sector to drive meaningful, technology-rich change into the construction industry through offsite solutions. To be successful all parties will need to co-operate to ensure delivery of the bright ambitions of BTR.

 

Offsite thinking is in Geraghty Taylor’s DNA and we always design with offsite in mind.

 

Geraghty Taylor. Create differently

 

 

#BTR #BuildtoRent #Brand #Brandbeforebuilding

Insurance Implications of Modern Construction

Geraghty Taylor is pleased to present our first guest article by Shaun Grainger of PIB Insurance Brokers, picking up on the vital insurance issue covered in our earlier MMC article.

 

The UK national housing crisis and ongoing pressure to provide new housing is showing no sign of abating. More housing is required to ease the strain on the housing market and hit the proposed government targets. The natural solution is to build cost-effective new homes, rather than conversion or alternative housing arrangements. Furthermore, the demand in rental sectors such as student accommodation, build to rent and retirement living, is also seeing an increase in building activity for developments with purpose-built solutions. Modern Methods of Construction (MMC) and modular construction are being utilised throughout the industry as efficient and quicker ways of building to meet the ongoing demand, with its predominant use in the development of high-rise apartment blocks.

 

While modular and other forms of MMCs for residential and commercial property are nothing new, having been part of the industry in various forms for many decades, they do present some important insurance considerations for those insuring their pre-build and construction.

 

Insuring the ‘product’ – Warranties and Indemnities

As technology, and the building methods that follow, improve then naturally so should the quality in design and manufacture of modular units. This leads to a primary focus of inspecting the build off-site and reducing the time spent on-site reducing defects, which have been known to delay completion on a large-scale project and use the time and resources of multiple contractors.

 

For the insurance sector, the units finished offsite are now being viewed as ‘products’ in themselves, from a design, build and installation perspective. Therefore, placing increasing importance on having the correct insurance warranties and contractual obligations. Current insurance warranties would provide protection for up to 12 years from practical completion, notwithstanding the usual contractual requirements. Within the residential market, these warranties are a requisite particularly by funders, especially if the properties are being sold/financed. However, the same benefits can also apply to commercial units.

 

Does using modular construction mean higher claims?

As a ‘product’, there is greater clarity of control and therefore better control of the delivery, which may, in turn, reduce the number of claims brought about in construction. However, due to the type of construction, these claims would likely be greater than in traditional construction as the whole unit may need to be replaced in a problem occurs.

 

Other insurance considerations and risks to be considered which may lead to increased claims costs include:

  • Buildings using MMCs will often only be designed to satisfy local Buildings Regulations which typically only cover life safety issues, not fire resistance. Using lightweight and combustible materials also mean there will be less resistance to fire spread.
  • Timber framed buildings are of concern to insurers and will require fire suppression measures.
  • External cladding panels with foam fillings have excellent insulation properties but are highly combustible.
  • Fire/smoke and water can get into the voids between modular units leading to much larger claims than would otherwise be the case.
  • Connection of services to pod units may be made by non-specialist tradesmen which can lead to problems over time.
  • Accessibility for repairs and maintenance may be difficult, repairs are potentially less straightforward if a whole pod has to be removed, especially if at the bottom of a high-rise building.
  • The fire break integrity of the building is easily compromised by drilling into panels to install new services.
  • Many MMCs are new and innovative, their resistance to damage and performance over time is unknown.
  • There may be problems in obtaining replacement parts in future, particularly if the manufacturer has gone out of business.

 

Insuring the modular developer

The advantage for developers lies in the fact the modular companies have improved supply access and stock capacity than those with specific onsite construction. Modular companies can plan the build more efficiently without reliance on multiple parties or contractors. Further benefits include faster construction times, less people on site and less wastage. Quality control is improved as works are carried out in a controlled environment and less prone to human error and services (plumbing & electrics) can be pre-installed so that the only connections are required are to the external supplies once in situ. The modular constructions are also are highly energy efficient.

 

Modular buildings can be cheaper to insure as the industry is still in its infancy for the insurance market. In future, this could lead to less complicated placement, which in turn could also result in lower premiums although there is little evidence for this in the current market.

 

Modular construction – what are the pitfalls?

Although MMCs do have many benefits, the risk of the completed modules themselves can be damaged or destroyed in transit is possible, which results in longer delays to the programme. These may not be covered under a Delay in Start up (DSU) section of a Developers Project insurance programme, especially if responsibilities for storage or delivery have not been clearly defined.

 

Also, if a contractor or supplier becomes insolvent in a traditional build contract, the developer can obtain alternatives. If a modular producer goes insolvent or the units are damaged beyond repair before reaching the site, it would prove more difficult to obtain replacements in a suitable timescale.

 

The insurance broker and BOPAS

Working with your insurance broker and MMC insurers can address the concern of using modular construction during the design phase. It is also worth considering the Buildoffsite Property Assurance Scheme (BOPAS) Scheme, which provides an assurance of the integrity of offsite construction systems delivered in a consistent and competent manner conforming to contract specifications.

 

The BOPAS assessment involves all aspects of the business operation including systems, processes and procedures, together with handover interfaces from design through offsite manufacture and construction/assembly to client handover. These are all being tested against the arrangements for sustaining quality delivery, dealing with environmental and project changes and the control measures that are applied to mitigate delivery risks.

 

Set up by BLP insurance, the BOPAS scheme provides industry wide accreditation for the modular products used in construction. Using BOPAS approved contractors gives your insurer confidence in the quality of the product and relinquishing the need for additional surveys and inspections by the insurer. In time, this may also result in lower premiums and the market confidence increases, however this has not yet been evident.

 

The importance of disclosure

The use of MMCs is an important feature which should be disclosed to insurers who may require additional precautions to be undertaken. If you are buying a property, the use of MMCs may not be immediately obvious.

 

The Insurance Act of 2015 introduced a duty of fair presentation, meaning that the insured must make the insurer aware of all the risks of insuring the building or home. Therefore, if you have any doubts as to the construction of a property it is important that you investigate and establish if this is the case. If an MMC has not been disclosed to the insurer, they are within their rights to impose a rateable settlement in the event of a claim or, even worse, avoid the policy which could potentially leave Property Owners or Developers many £1000s out of pocket.

 

Geraghty Taylor. Create differently

 

 

#BTR #BuildtoRent #Brand #Brandbeforebuilding

 

 

 

To discuss with a property specialist about insuring your property, where built with MMC or traditional methods, please contact – Shaun Grainger, PIB Insurance Brokers – Sales Manager, Property and Construction on 07496980612 or shaun.grainger@pib-insurance.com.

Why is brand so important to Build to Rent

....or put another way...why are designers embracing brand when what they do is design buildings?

 

Ultimately, we can't design the building without a thorough understanding of the business strategy that the building is supporting. This is best defined by its Brand.

 

Brand in most peoples’ minds means a fancy logo. But if you consider it for a moment, you realise that logo conjures up a mental picture of what the product is, who it is created for, its quality, the service behind it and, ultimately, the price you will have to pay for it; all gleaned from that fancy logo. So clearly, from the business operator’s perspective, the brand associated with the logo embraces the entire business philosophy and strategy of the company.

 

Put this into the Build to Rent context and you can quickly see how the brand defines the target audience, the style of the building, the level of services, the provision of amenity and even the price point; all crucial factors in good design. We call this #BrandBeforeBuilding

 

Many of the businesses that we are working with do not come from a consumer product background. They are typically from a real estate development, property investment or housebuilding background. Brand, in so far as it applies to their product, has not previously been a mainstay of their businesses.

 

You might think this only has relevance to the long-term operator/investor.  Surely a developer looking to exit on completion or even at planning doesn't need to be bothered by brand. Well, they do if they want to reach the widest buyer market and get the best price.

 

We are working now on schemes where the developer will exit on planning, but we are integrating what you might call a white-labelled, loose brand into the scheme to allow the future operator to shoe-horn in their own brand.

 

Brand in BTR is very new with only a few operators having a completed model.  Even those internationals with long-established brands need to put it into a UK context. When we work for an established US multifamily operator, for instance, we must first get a thorough understanding of their existing brand values. We then need to discuss how these might be adapted for the UK marketplace and then the specific building in question.

 

A true brand integrates all parts of the provider’s business plan and BTR offer. It acts as a differentiator between providers and helps the consumer navigate and select between them. A good customer experience builds trust and loyalty and gives more brand buy-in. As a brand develops, it generates engagement with its customers, making them feel comfortable with its specific lifestyle offering.

 

In BTR, this will deliver lower voids by increasing renewals, extending the length of leases and increasing the number of customer referrals to like-minded buddies. Done well, it will maximise net operating income and deliver business success. This builds a reputation and enhances the customer experience.  We have explained this BTR Brand Value Loop in a recent infographic. Take a look.

 

 

Geraghty Taylor. Create differently

 

 

#BTR #BuildtoRent #Brand #Brandbeforebuilding

BTR: a Catalyst for Successful Mixed-Use Development

It is quite clear to us at Geraghty Taylor that Build to Rent has an incredibly valuable part to play in pump-priming successful mixed-use and tenure developments and de-risking a part of the disposal phase.

 

Alongside other rented residential solutions like student living, co-living and even retirement living, it has the power to deliver the activity, atmosphere and sense of community from the earliest phases of development, creating the vibrancy necessary to attract home buyers to the "for sale" elements of the scheme. Importantly, it can prove to be a very useful way to reduce development spending and recoup some cost at the earliest opportunity.  The English Cities Fund have used the approach at Salford Central where the 225 unit Slate Yard BTR scheme sits alongside the wider £650mn mixed-use development.

 

Placemaking is so important in large-scale development. It is clearly about quality master-planning and sensitive design, but to truly create a sense of community it is so important to remember it is all about people; people who want to be there because of the quality of the environment and vibrancy of the atmosphere.

 

BTR brings activity. Using modern methods of construction, buildings can be delivered quickly. The let-up process is dramatically faster than traditional sales, so residents start using the site much earlier and high occupancy levels are achieved quickly. This is in marked contrast to the situation in some of London's notorious see-through towers where buyers are non-resident investors who frequently leave their investments vacant and often don't let them on as BTLs.

 

BTR schemes are typically close to transport hubs and so espouse reduced car ownership, preferring instead car-pooling and sharing. Bike usage is also high and this all leads to increased journeys on foot or bicycle creating a more human presence in the scheme.

 

Suitable amenity provision is standard in BTR buildings. This amenity can often be shared with residents of other buildings in the complex or even opened to a wider local membership. 

 

The UK now enjoys two hugely successful schemes which have fully embraced BTR. Get Living's scheme at East Village was the pioneer, quickly followed by Tipi's Wembley Park scheme which was initially conceived as "for sale" residential. We can learn a lot by looking at the experience of these developments over the last 10 years or so.

 

East Village's origins as the Olympic village meant that it had no specific amenity provided. The new phases of development will incorporate shared facilities to be used across the village. Importantly, the development has supported the creation of a new school and interestingly helps fund a system of security cameras and additional policing.

 

With the arrival of the Brent Civic Centre, Wembley Park has integrated civic functions offering a library and hireable function rooms. They have developed an environment to encourage successful food and beverage provision with the creation of the designer outlet centre and Boxpark which nicely dovetails in with the extensive student living on site. All of this is supported by local convenience retailing.

 

These pioneers have discovered that their product appeals to a much wider base than purely millennials. "Millennial-minded" people come in all ages and from all backgrounds. 

 

Just this week, L&G has announced their proposals for 1,000 new homes in Wandsworth catering for "all ages and social groups" including 35% affordable housing. At the start of May, they also announced plans to launch Guild Living; a £2 billion business combining retirement living with children's nurseries in city centres.

 

So if our decision to include BTR has created the vibrancy we desired, what has it done for our financial position? Well, we are receiving income faster and this income producing asset delivers opportunity.  A management contract may have already been agreed with an appropriate operator and the asset is highly saleable. Indeed, institutional investors are hungry for this type of product and will commit at the outset. 

 

This provides a rare opportunity to reduce total development expenditure at an early stage in the overall project plan, recycling capital and helping with cash flow and profitability. Given our deep involvement in the BTR space, Geraghty Taylor has developed an audit capacity which lets us review existing buildings and advise on their suitability for letting and give guidance on any potential interventions required to make them suitable for the purpose.

 

BTR is fast establishing itself as an important use-class in its own right, earning itself an undeniable place in mixed-use developments.

 

#BTR   #BuildtoRent   #Brand  #Brandbeforebuilding

 

The Virtuous Triangle

All development vehicles are geared towards generating a financial return for their investors. However, it is the long-term, income-generating characteristics of the BTR model that sets the sector apart from its counterparts. The long-term nature of the business results in healthier and more equitable relationships between investors and their customers.  What’s more, these benefits reach far beyond the intimate supplier/consumer relationship by enhancing the collective built environment through to the very nature in which buildings are produced.

 

At Geraghty Taylor we refer to this as the ‘BTR virtuous triangle’.

 

 

 

 

Customer Focus starts the process and quality sits at its heart

 

First, the mutual dependency between provider and consumer is where the balance begins. BTR providers are much more dependent on the ongoing satisfaction of their residents, who are seen as customers and far removed from the vulnerable ‘tenant’ that might have previously been subject to the whims of one-off Private Landlord’s. Get your BTR offer right, and continue to get it right and you will retain your customers. Your customers will also speak for you: via friendship networks and social media, when you are trying to fill your apartments. Get the quality of design and efficiency of your operation right and you will continue to achieve your projected Net Operating Income (NOI) over the course of your investment. Simply put, if you undervalue your customers or low ball on quality of product or service, the outcomes are entirely predictable.

 

So, at the apex of our virtuous triangle we have customers whose continued custom is inextricably bound up in the success of a BTR initiative – as we say, happy people will give – and continue to give - you money!

 

How does this help the housing crisis?

 

BTR is a nascent segment of the residential market and over the 5 years that BTR has been around it has produced only 30,000 completions. A figure which pales given the targeted national housing need of circa 300,000 per year. However, institutional investors are now persuaded that BTR is a bankable investment vehicle and an estimated £6 billion is already committed, with a further 110,000 units under construction or in planning. Given that a typical BTR project only begins to wash its face at around 150 units, the ingredients for the delivery of a meaningful contribution towards addressing the UK’s housing shortage is there for all to see – more good quality homes for the UK’s population from a previously unanticipated investment stream.

 

This takes us to the second point of our virtuous triangle: speed of delivery.

 

Unlike homes that are constructed for the sales market, where there is an incentive to balance the supply/demand equation in favour of the creation of scarcity to maintain pricing aspirations, BTR is about speed of delivery.  As soon as the button is pressed on a BTR project the clock starts ticking and the race is on until rent stabilisation is achieved. Indeed, BTR operators regard the construction process as a mere bump in the road in the life of their investment. The sooner a development can be completed, the sooner the ‘money machine’ starts to earn its keep!

 

Also, the benefits of completing projects that offer a substantial critical mass are recognised by developers and towns and cities alike. BTR, with its forensic focus on customer experience is the ideal catalyst for regeneration projects – bringing early-stage community building energy and place-making attributes to their locations far quicker than their for-sale counterparts. For this reason, BTR initiatives are now being seen as vital components in large scale regeneration projects across the country.

 

The ‘need for speed’ takes us to the third point of our triangle: innovation

 

The construction industry is renowned for its sluggish adoption of innovation. We hear regular talk of how cyclical downturns and a dwindling labour force get in the way of creating sustainable pipelines - business that could offset the investment required to take advantage of truly innovative delivery techniques and technology. This is all changing and BTR is playing no small part. The ambitious delivery projections of its participant’s means old delivery methods are being completely re-evaluated. The elimination of risk is a key objective of every construction project, but never before have the drivers for the advantages gained from forcing out risk, dovetailed so eloquently with the drivers for quality and, most importantly, the need for rapid delivery.  BTR business plans are predicated on scale. How do you deliver scale quickly along with reliable quality and cost? One only need look at the automotive and manufacturing industries – and there is not a man with a cement trowel high on a rain-swept scaffold in sight!

 

L&G has already taken the plunge by investing in their own factories to facilitate the delivery of their housing product. Geraghty Taylor is part of a consortium, alongside Cogent Consulting and Peter Dann, that is at the prototyping stage in the creation of modular apartments for a US client who have targeted the completion of 10,000 new homes over the next 5 years. Far from feared identical cookie cutter boxes, these approaches offer high quality, factory-made homes delivered at speed and possessing all the individuality and context specificity as any scheme built in situ.

 

From a production perspective, such initiatives are only possible with effective collaboration between professional and construction teams, coupled with the application of technology as is so robustly argued for in the Farmer Review, Modernise or Die - the unflinching analysis of the construction industry and the changes required to safeguard its future.

 

If nurtured carefully, BTR has the potential to positively benefit multiple stakeholders on multiple fronts: investors are incentivised to play a long term game and still enjoy the financial returns that will justify their efforts; towns and cities have a new and effective catalyst for the creation of high-quality people-centred built environments; the construction industry has a vehicle through which the fruits of investment in innovation and modernisation can be clearly seen and perhaps most importantly of all Britain’s population will have a housing alternative that carefully listens and rapidly attends to their needs…sooner rather than later.

 

#BTR   #BuildtoRent   #Brand  #Brandbeforebuilding

 

Happy People Give You Money

Designing for BTR requires the creation of an designerure that supports excellent customer service, integrating an efficient operating model into an attractive product that creates a sustainable long term income for the investors and a good living experience for residents.

 

Designers have to ask the strategic and searching questions about what the BTR business model expects from its building, at what cost, and how the building could be expected to perform over time. To do this, we must ‘create differently’ as the design for long term revenue is about starting with the customer: defining what products, services and amenities will be offered, and how the customer interaction with the business model should be managed.

 

In BTR the source of revenue is the individual resident or customer and is generated through rent and services. This places BTR firmly in the culture of a consumer market where keeping the customer happy and loyal is key to securing ongoing revenue. In good BTR the customer is at the center of design, operational and income generation dynamics.

 

Good quality BTR design will offer a product that will be attractive to the market and also provide flexibility to respond to trends or shifts in consumer behaviour. The Designer and Operator must work closely together to define the customer experience and to agree on the optimum balance between capital expenditure and operating costs. With this information, a design team can create solutions that support these business objectives. In other words, defining and controlling the customer experience is the key to defining good design, predictable operational costs and sustainable revenue.

 

We call this creating a brand. It can be limited to a single project or underpin a portfolio. Geraghty Taylor has a proven methodology that starts with setting the expectations for revenue, product, service and business requirements. These are the ‘brand business objectives’ and will inform the creation of ‘brand values’. These values describe the experiential, cultural and communicable elements of the brand, and with them, the process of creating the ‘BTR customer experience’ can begin. As designers, we must translate these into a product proposition, and for this we use our ‘brand chassis’ ME, WE, FRONT, BACK that describes the four key elements of customer experience:

 

ME - my private spaces
WE - shared spaces and places
FRONT - front of house or technology interaction with customers
BACK - back of house support and logistics

 

 

Ideally, a BTR brand is built up independently of a site or location. The brand is then used to inform and guide the designerure, interior design and placemaking on specific sites. A brand helps to describe the requirements of all stakeholders from investors, operators and through to customers. The more richly detailed this information, the easier it will be for the designer to design better solutions for you and your customers.

 

From a purely design perspective, it is very important that both the interior and designerural design is closely integrated from the beginning of this process. At Geraghty Taylor, we believe that the best way to do achieve this is to ‘design from the inside out’ thereby ensuring that the customer experience and operating requirements are central to all design decisions. The customer experience is not limited to the building itself, it extends to placemaking and the integration of the new building into the local community. Thorough context analysis enables designers to develop ideas for the building and its amenities that will support the new the BTR customer experience and complement the local community and amenities.

 

A well thought through brand also creates benchmarks that will underpin your business, bringing consistency and predictability to the design of the product, its procurement and operation. It will also help with site selection. Design your Brand Before your Building so you, your designer, your procurement and operational teams, but most of all your customers, know what to expect. Done well, this will result in a marketable BTR offer with efficient and predictable operating costs. With a solid product and operating base, revenue-generating strategies can be deployed. This is all underpinned by a commitment to customer satisfaction and providing an attractive product.

 

In very simple terms happy people will give you money. So in BTR, our priority is to get them happy with a well thought through offer, and then keep them happy!

 

#BTR   #BuildtoRent   #Brand  #Brandbeforebuilding

Designing for BTR requires the creation of an designerure that supports excellent customer service, integrating an efficient operating model into an attractive product that creates a sustainable long term income for the investors and a good living experience for residents.

 

Designers have to ask the strategic and searching questions about what the BTR business model expects from its building, at what cost, and how the building could be expected to perform over time. To do this, we must ‘create differently’ as the design for long term revenue is about starting with the customer: defining what products, services and amenities will be offered, and how the customer interaction with the business model should be managed.

 

In BTR the source of revenue is the individual resident or customer and is generated through rent and services. This places BTR firmly in the culture of a consumer market where keeping the customer happy and loyal is key to securing ongoing revenue. In good BTR the customer is at the center of design, operational and income generation dynamics.

 

Good quality BTR design will offer a product that will be attractive to the market and also provide flexibility to respond to trends or shifts in consumer behaviour. The Designer and Operator must work closely together to define the customer experience and to agree on the optimum balance between capital expenditure and operating costs. With this information, a design team can create solutions that support these business objectives. In other words, defining and controlling the customer experience is the key to defining good design, predictable operational costs and sustainable revenue.

 

We call this creating a brand. It can be limited to a single project or underpin a portfolio. Geraghty Taylor has a proven methodology that starts with setting the expectations for revenue, product, service and business requirements. These are the ‘brand business objectives’ and will inform the creation of ‘brand values’. These values describe the experiential, cultural and communicable elements of the brand, and with them, the process of creating the ‘BTR customer experience’ can begin. As designers, we must translate these into a product proposition, and for this we use our ‘brand chassis’ ME, WE, FRONT, BACK that describes the four key elements of customer experience:

 

ME - my private spaces
WE - shared spaces and places
FRONT - front of house or technology interaction with customers
BACK - back of house support and logistics

Ideally, a BTR brand is built up independently of a site or location. The brand is then used to inform and guide the designerure, interior design and placemaking on specific sites. A brand helps to describe the requirements of all stakeholders from investors, operators and through to customers. The more richly detailed this information, the easier it will be for the designer to design better solutions for you and your customers.

 

From a purely design perspective, it is very important that both the interior and designerural design is closely integrated from the beginning of this process. At Geraghty Taylor, we believe that the best way to do achieve this is to ‘design from the inside out’ thereby ensuring that the customer experience and operating requirements are central to all design decisions. The customer experience is not limited to the building itself, it extends to placemaking and the integration of the new building into the local community. Thorough context analysis enables designers to develop ideas for the building and its amenities that will support the new the BTR customer experience and complement the local community and amenities. 

 

A well thought through brand also creates benchmarks that will underpin your business, bringing consistency and predictability to the design of the product, its procurement and operation. It will also help with site selection. Design your Brand Before your Building so you, your designer, your procurement and operational teams, but most of all your customers, know what to expect. Done well, this will result in a marketable BTR offer with efficient and predictable operating costs. With a solid product and operating base, revenue-generating strategies can be deployed. This is all underpinned by a commitment to customer satisfaction and providing an attractive product.

 

In very simple terms happy people will give you money. So in BTR, our priority is to get them happy with a well thought through offer, and then keep them happy!

 

#BTR   #BuildtoRent   #Brand  #Brandbeforebuilding

Rented residential appealing to investors across the globe

Well over a third of all the cash raised globally last year, for sector-specific private equity real estate funds, targeted funds aiming to invest in multifamily rented residential. This latest survey by PERE shows the funds amassing a war chest of over $10 Billion. With typical debt leveraging, this would give those funds buying-power in the order of $20billion.

 

Pension funds and insurance company investors across the globe are appreciating the favourable investment characteristics of rented residential. Their quest is to find investment assets that match their liabilities. Typically, these liabilities are linked to inflation in the long term and often to wage inflation. Our home is such an important part of our well-being that most of us spend more than a third of our income on it. The rent we pay or the purchase price we are willing to accept reflects the current state of the economy and has traditionally grown in line with that economy.

 

With this positive macroeconomic background, get the investment characteristics right and you are onto a winner. Flexible shorthold tenancy contracts work for both parties. A broad income base from multiple occupiers reduces void risk and, if operated as a business and managed like hospitality, we can achieve rapid re-letting and maintain high occupancy rates. Working hard to establish a community within each scheme will increase the length of stay of your residents. And ultimately, remember one of our catchphrases at Geraghty Taylor, “Happy customers pay you money!”

 

So now you can see what these global investors are thinking. This is an asset that delivers a solid long-term income from a wide potential customer base. But be sure this requirement was built into the scheme from the start. Be mindful of the play-off between upfront cap-ex and ongoing ops-costs. Appreciate the cost of management and future cap-ex and understand the life cycle of the building. Take a look at our BTR Timeline.

All the funds raising money will hope to benefit from rental growth in the long-run. The brave ones will take on development risk to enhance their returns to investors by making a development profit. In the UK it is interesting that we are at the very beginning of our journey into multifamily investment, but despite this being an “emerging” market, we already have pricing which is very reflective of a mature institutional market. There seems to be little if any, obvious first-mover premium for the early adopters. We seem to have imported the idea but also the pricing.

 

The old-world order of cash raising has continued with North America taking 42% of all cash raised and Europe just over 20%. In the UK, Hearthstone Investment Management announced at the end of February that it had closed Hearthstone Residential Fund 1 with just over £200 million raised. The Fund has seven local authority pension fund investors and welcomed The Merseyside Pension Fund and The Tyne and Wear Pension Fund in this latest round. They clearly see the investment case, but just as important, the social significance of funding housebuilding in the UK.

 

#BTR   #BuildtoRent   #Brand  #Brandbeforebuilding

In Search of Scale

One of the biggest challenges facing operators in the new BTR market in the UK at present is how to create scale in their business. Recent weeks have seen two fascinating and novel approaches to this challenge; partnering with developers and simple acquisitions.

 

At the start of last month, Telford Homes told us that they anticipate that 50% of the units they will deliver this year would be for rental. Just a few weeks later they let us know how they will finance them. They are partnering with seasoned BTR investors, Invesco Real Estate and M&G Real Estate. M&G will be forward funding schemes with less than 200 units with Invesco coming into fund the larger developments. In capital terms, 200 units is likely to represent deals of between £75 million and £100 million. With Telford homes existing land-bank to draw upon we can anticipate some 1,000 units being delivered in the next couple of years.

 

Towards the end of last year, we saw a deal between Blackstone and Sage Housing, a housing association operator, to fund the delivery of affordable housing in the UK. Blackstone needed scale in the operation and couldn't afford to wait to build its own portfolio. This route could see them involved in the delivery of more than 20,000 homes over the next 5 years. Funding an existing operator clearly appeared an innovative, if mildly controversial, way of investing in UK housing at scale, quickly.

 

In January, CBRE Global Investors announced it, too, will partner with registered providers. Its CBRE UK Affordable Housing Fund has held a first close of £250 million with 13 institutional investors, including social investment institution The Big Society Capital. The chosen registered providers will manage the assets and will be responsible for the rental income, maintenance and property management.

The other way of achieving scale is, quite simply, by buying it. Clearly, it takes time to build scale organically by developing out your own units. American giant Cortland announced in March that it is intending to acquire the £400 million Dandara regional rental portfolio. This will give them a further 2,000 units across the UK, in cities like Manchester Birmingham and Leeds. There is also an option to buy further sites in the future in Glasgow and Aberdeen, to deliver another 3,000 units

 

Cortland is looking to have 50-65% of their units in outer London and the M25, with the remainder in regional centres. It plans to build a £4 billion pipeline of 10,000 homes across the UK.

 

Invesco has already used this approach having acquired the Platform portfolio from Westrock; a £116 million, 580 unit portfolio split across five buildings, in March 2017.

 

In the light of all this activity, Geraghty Taylor has been busy providing due diligence advice to help clients review existing built schemes, as well as schemes moving to planning, to review their suitability for BTR operations. The experience built up, in delivering 10%+ of the existing built stock of BTR, positions us well to add value and suggest interventions to get the most out of investments.

 

No doubt, these deals will herald many more where existing owners looking to cash in their hard-earned profits from creating rental portfolios and we will see other volume house builders and Housing Associations forming similar funding relationships to Telford Homes with other BTR investors in the future.

 

#BTR   #BuildtoRent   #Brand  #Brandbeforebuilding

“Engaging the future” – MIPIM Special

The theme at MIPIM 2019 was “Engaging the Future”.   In real estate, most of us will immediately think of the new PropTech initiatives. But look at the definition of innovation and you see it is “a new thing or a new method of doing something"

 

At Geraghty Taylor, our watchword is "Create Differently". Doing things the way the industry has always done them is simply not good enough for us.  Sure, when that approach was used for the first time it was the best option, but you know the saying credited to Einstein; “doing the same thing over and over again but expecting different results, is the definition of insanity”.  Guess this makes us disruptors!

 

BTR is a case in point and needs new approaches.  If we thought in the traditional way we would end up with sub-optimal, adapted "for sale" units, lacking the crucial components of community, amenity and service. With these in mind, let’s think about two key areas in the BTR context; brand and offsite construction.    

 

We see innovation, clearly, in our methodology; #BrandbeforeBuilding, which takes a critically different approach. Until we have established a complete business identity for the project we don't even think about design. To us, this radically different approach to defining the traditional project brief is as much a disruptive technology as any software app.

 

From the outset, we consider the needs of all the stakeholders in the project and look to deliver acceptable dividends to them whether these be measured financially or otherwise.

 

Planners and city leaders will be looking for places that add to the community and ease pressure on housing. Investors and operators will be looking to the long-term financial returns; not just simple gains on sale at completion. And, of course, the occupiers want to be treated like customers and feel that they have truly found “home”. Increasingly, we are realising that these apparently differing requirements are actually fully complimentary.

 

Defining brand critical elements is so powerful in controlling the construction process. Value engineers throughout this process know what they can and cannot touch and so don't undermine those dividends.

 

The use of offsite techniques is also a perfect example of innovation in BTR. There is great synergy between BTR and offsite methods, particularly modular volumetric.  BTR is a solution aimed at providing residential units at scale and benefits from rapid delivery. It gets heads on beds in the shortest time.  Modular delivers this speed of construction and high-quality components for comparable price.  As odd as it sounds, this speed of delivery can conflict with the aims of the housebuilder who often artificially controls supply in order to manage values through the sale cycle. This is one reason why modular has seen slow take-up, despite the ever-worsening conditions in the construction industry. (see The Farmer Review – “Modernise or Die”) #MODIE

 

We see off-siting not as a procurement decision but as part of the business strategy. All our buildings are designed to be compatible with offsite techniques though all can be built traditionally.  We will increasingly see BTR developers using modular.  Greystar, for instance, is currently building the world’s tallest modular buildings in Croydon. They are procuring their modules from the UK.  Other clients we are working with are looking to import units into the UK from further afield.  It could well be that your next bedroom will find its way onto these shores on a container ship from the Far East. Some forward thinkers, like L&G, are even making a substantial investment in securing their own procurement source.  Legal &General Modular Homes have created their own factory in Yorkshire.

 

You will no doubt have seen some amazing new PropTech at this year’s MIPIM but innovation is not all about apps and software. The most powerful tool of them all is in your head.

So think and Create Differently!

 

#BTR   #BuildtoRent   #Brand  #Brandbeforebuilding