​Bisnow Build-to-Rent Conference 2021 – A great exchange of insights on Suburban Build-to-Rent

Several Chapman Taylor Residential team members attended the annual Bisnow Build-to-Rent Annual Conference at London’s Wembley Stadium on 23 September, where Residential Director Michael Swiszczowski spoke as part of a panel discussion on "Expansion in the 'burbs: The long-term benefits of suburban Build-to-Rent" alongside key figures from Rightmove, Legal & General, IMMO Capital, Urban&Civic and Buro 4.

In addition to Michael, Chapman Taylor's team at the event included Director Phil Durrans, Associate Directors Lucy Flintoff and Jonathan Harris and Senior Architect Richard Daw. Our company stand was busy throughout the day, with visitors talking to the team about our experience and capabilities in, and insights into, the Build-to-Rent (BtR) market and the residential sector more generally.

With institutional investors and the government pouring billions into the BtR sector, the Bisnow annual conference brought together key industry professionals and experts from across the world to discuss the future of the Build-to-Rent phenomenon and to swap insights gained from experience so far.

Michael’s panel discussion opened by defining what Suburban Build-to-Rent (SBtR) is – typically, any Build-to-Rent development which consists of 60 homes or fewer per hectare, usually a distance away from urban centres.

Michael pointed to the sheer scale of the opportunity that the SBtR concept presents, illustrating the point with statistics from Savills which show that two-thirds of the population of England and Wales (c.16.3 million households) live in suburban locations, and 53% of the private rented sector (c.2.3 million households), yet the institutionally backed BtR sector is 90% focused on dense urban centres; BtR is currently not targeting or tapping a very large segment of the market – the majority of the rental market, in fact.

He outlined how the potential opportunities offered by SBtR are reinforced by the fact that the longer tenure on offer in suburban location is very attractive to investors – in more mature markets, such as in the USA, typical tenancies range from 3-5 years, compared with the much faster “churn” at urban Multifamily developments. Suburban rental properties also have higher occupancy rates, with Savills putting the figure as higher than 97% in relation to a portfolio of such properties recently purchased by Goldman Sachs in the North West of England, as reported by BTR News.

Michael also spoke about the natural evolution of what has become known as “Generation Rent”. When the UK BtR sector (then more usually called "PRS) began, the target demographic was typically 25-35 year olds, but, as these people have matured (and the market with them), there is an increasing demand for more space, including gardens in family-friendly locations. This trend has been accelerated by the COVID-19 pandemic, with many realising the importance of adequate space to mental health, particularly those who wish to work from home more. The level and nature of this demand from people who are comfortable renting in the long term further illustrates the extent of the gap in the market which Suburban BtR could fill.

A key element of the discussion was the influence of the USA Multifamily market and whether the UK BtR market still has lessons to learn as it becomes mature itself. One area to which Michael drew attention is that, in the USA, as in the UK, the focus was initially on urban Multifamily developments, but investor interest is increasingly growing in the suburban Single-Family market, which he said offers encouragement to those who believe in the potential of the SBtR format.

A major difference between the two markets, however, is that a lot of the housing stock in the US market was purchased following the post-2008 global financial crash; Michael emphasised that this template for growing SBtR stock was a departure from Build-to-Rent as we understand it in the UK, with no “design-for-rent” element to the process. Therefore, he argued, the UK market may develop more slowly, but perhaps with a higher-quality, sustainable and more context-appropriate product on offer to potential residents.

Another feature of the USA market to which Michael drew attention is that developments within the sector tend to be geographically concentrated. Caroline Foster of Urban&Civic spoke about a demand for a similar concentration of Single-Family developments in the arc between Cambridge and Oxford, one hour from London, particularly near places of major employment such as Cambridge Science Park.

On the specific subject of designing for SBtR, Michael drew attention to the essential importance of features such as sufficient space, access to gardens and home working capability, meaning that what we consider to be appropriate amenities for an SBtR development will be different from those in their urban counterparts; there will be less emphasis on internal provisions, such as cinema rooms and gyms, and more focus on the external amenity space associated with each house, complemented by the likes of a multi-function community centre, family-orientated amenities, playground and other such shared facilities.

The panel also discussed how Multifamily BtR initially anticipated that a premium could be applied for apartments which are pet-friendly (with a suggested figure of about 10%); with the experience we now have from established schemes, we know that people value this more than was thought and are willing to pay even more for pet-friendly homes, sometimes even if they don’t have pets yet themselves. Michael stated his belief that we can safely anticipate pet-friendliness being even more important in the context of SBtR.

In response to a question about catering for older people, Michael confirmed the importance of catering for all ages and lifestyles to deliver truly inclusive and sustainable places in which people will want to live. He pointed to the mutual benefits of inter-generational living, such as potential childcare or school drop-off assistance for working parents or help such as errand running or social support for older people – all forming an integral part of the wider placemaking strategy for such developments.

The attendees expressed great satisfaction with the quality of the analysis relating to the SBtR sector on offer during the panel discussion. Michael stated that Suburban Build-to-Rent has the potential to become an even greater disruptor to the residential rental market than its urban counterpart.

Chapman Taylor is expanding its residential portfolio across the United Kingdom, with Build-to-Rent developments very much at the heart of our strategy. We are also leading the way in innovative off-site design and construction methods, which we think is an important solution in helping combat the UK’s housing crisis.

We would like to thank Bisnow and all the participants for a very insightful exchange of ideas about the future of the Build-to-Rent sector, particularly in relation to the Suburban/Single-Family market.

Michael Swiszczowski (BA(Hons), MArch, ADPPA, ARB, RIBA)

Residential Director, UK

Michael joined Chapman Taylor in 2016 to strengthen the practice’s residential expertise. A key member of the Manchester studio’s management team, Michael has a remit to develop and grow the practice’s residential and hospitality sectors across the UK business.

He has experience working on award-winning residential projects, with a particular focus on Build-to-Rent, student accommodation, hotels, serviced apartments and modular construction.

He is an RIBA-elected member of the Regional Council for RIBA North West.

Areas of expertise:

Residential / Build-to-Rent / Student Accommodation / Hotels

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