'Build to Rent – How will it change UK property practice?' - BLP Insurance Roundtable
- Location: BLP Office, London
- Date: 17/06/2014
- Time: 08:30 - 10:30
There has been widespread media coverage in the last six months on the PRS initiative and the subsequent effects of this on the property market. Although much has been said about the commercial impact, little has been debated about the technical issues that PRS brings and those that developers must consider if the scheme is to be a success. Richard Saxon CBE chairs this roundtable at BLP's office.
The scope for discussion is set out in the recent Urban Land Institute’s ‘Build to Rent’ report. It notes the shift from focus entirely on first cost to focus on minimising operating costs coming out of gross rent. Whole-life costs are central, making BLP Insurance’s approach to modelling and ensuring these costs very relevant. As part of the initiative, developers will build for lasting appeal rather than just first impact.
- Richard Saxon CBE - Director, BLP Insurance
- Brian Kilroy - Business Development, BLP Insurance
- Annabel Dixon - Journalist, Estates Gazette
- Ben Derbyshire - Managing Partner, HTA Design LLP
- Chris Adams - Project Development Manager, Legal & General Property
- Jacqui Daly - Director, Residential Investment Research and Strategy, Savills
- Joanna Embling - Member of DCLG Private Rented Sector Taskforce, DCLG
- Kate Ives - Development Director, First Base
- Mark Farmer - Partner, Head of Residential, EC Harris
- Michela Hancock - Development Director, Build to Rent, Grainger plc
Points of discussion will include:
- Can build-to-rent become an institutional asset class? If so how?
- The PRS initiative changes the logic and approach of commercial housing development somewhat. Build-to-sell is first-cost oriented; Build-to-rent is whole-life cost oriented if landlords want to maximise the margin on rental received.
a.How will this change the mind-set of those involved – what needs to be considered now?
b.How do we manage risk control when designing a purpose built PRS development?
Is this the time for BIM?
c.Do we have the tools to work this way?
d.How do landlords calculate their return on investment? How do you value build-to-rent stock?
e.How do you value this kind of property?
- Design and development
Build-to-rent management costs suggest large developments to minimise them per unit.
a.What design aspects need to be considered when building for PRS?
b.Supply chain – how can developers get more sites at the right price and in the right location to market, especially from the government?
c.How can we make sites for build-to-rent more viable (when competing against developers) – a separate planning class or long-term PRS allocation through S106 to bring down residual value of the land?
d.Sustainability of design: developers building for lasting appeal rather than for first impact. How do we design units for longevity?
e.What sort of unit size makes sense for this initiative in London?
f.Would it be different in provincial cities?
- Build-to-rent for PRS is more likely to use offsite build methods than market sale development because it’s not paced by rate of sales or dominated by first cost.
a.How will this help improve quality standards?
b.How will build-to-rent help to pioneer offsite construction
a.How do you de-risk OPEX?
b.The use of robust specification?
c.Access to risers from common parts?
d.Insurance against defects?
e. Using BIM to get an Asset Information Model for FM
- Innovative Building Management Systems can now monitor most building aspects and automate some of them.
a. Will build-to-rent be a good place to use them?
- Attracting and retaining tenants - Times have changed and tenants are now demanding more from their landlord.
a. What does the advent of shared facilities, advancements in technology and smart building management mean for developers?
b. What do we need to do differently this time?
c. What do you need to offer at different price points?
d. Common facilities, community services, concierge, bike stores/store rooms, parking/car club, gym
e. Can rental income be enhanced by minimising tenant energy costs?
f. Should tenants only have to pay for hot water and plug loads (appliances and devices)?