Build to Rent
How green is build-to-rent? Awareness of the damage we’re causing to our planet is heightening, so it’s time for the BTR sector to consider the environment, urges Richard Berridge
I t is an unlikely alliance! Greta Tintin Eleonora Ernman Thunberg is a 16-year- old activist schoolgirl from Sweden. Sir David Frederick Attenborough is a 93-year- old national treasure, broadcaster and natural historian Both have raised our awareness of how much damage we are causing to our planet. So successful has Greta been in her “skolstrejk för klimatet” she is now perceived by OPEC as the “greatest threat” to the fossil fuel industry. Sir David has shown us harrowing evidence of how pervasive and damaging our love of plastics has been to the environment. To segue this into a build-to-rent feature seems passé. As I write this, sitting on a terrace overlooking the Cote d’Azur all seems right with the world: the sun is shining, there’s a gentle breeze and the sounds of locals going about their business filter up to me. It seems that this way of life might last forever. But it wont. BTR is predicated to live far into the future. It’s a long-term income play for most of the institutions investing in the model; steady predictable growth, much in line with wage inflation with only the odd fluctuation in yields to dampen or enhance capital values. But what if there is no future? Or at least, not one we would recognise today. How would BTR’s long-term financial strategies play out then? And what is the sector doing to ensure a sustainable, carbon neutral
have some sort of photovoltaic capability and smart lighting to save energy. Some will offer electric vehicle charging points, a few rainwater harvesting and maybe even grey-water recycling. Modern methods of construction are hopefully helping towards sustainability, but generally, the focus is on brand, operational management and how that impacts on customer service. Proptech, for all its considerable advances, is less focussed on the ecology of a building and more on the economy. To look holistically at achieving a net zero BTR apartment building is complicated. Concrete and steel are not known for eco-compatibility and CLT has come under scrutiny of late for obvious reasons. So I look to something simpler: Houses. Houses have had some, but limited BTR focus. Sigma Capital – or PRS REIT as they are now known – is probably the dominant force in this sector, particularly in the North West. Their offer is pretty much a vanilla product – but there’s nothing wrong with that! It allows for affordable family homes, development of “community” and all professionally managed. It’s a neglected area of the private rental sector but a crucial one. Especially for the delivery of carbon neutral homes. Time has come to look at how we build our homes: the materials we use, how they’re sourced, how they’re delivered, the green credentials of the suppliers, of the financial institutions we use to fund the schemes. Everything, in fact, that goes into the design and build of new houses. To create a portfolio of eco-houses, at scale across the country, is no small thing. We are a still a nascent sector and constantly evolving what we do and how we do it. For me, looking to the future is crucial. The future is not ours; it’s our children’s and their children. The least BTR can do, as a sector constantly looking to make a difference, is to ensure that difference contributes towards a viable future. Richard Berridge is PRS and build- to-rent investment and development consultant at Blackbird Real Estate
(or even positive) future? The BTR sector has been pretty good at evangelising about most things: particularly in terms of redefining the relationship between landlord and tenant. The sector has also created buildings that are fit-for-renting purpose. Although let’s not kid ourselves, this was happening, at scale, in the 1930s. As the biblical saying goes “there is nothing new under the sun”. ESG – or environmental, social and corporate governance – is high on the agenda for most institutions and the government has banned gas boilers on new homes by 2025. Sustainability does inform BTR design along with life-cycle values. But building large-scale apartment blocks is an expensive business and so is achieving carbon neutral status. Most blocks will
25 ISSUE 102
www.newsontheblock.com
Made with FlippingBook - professional solution for displaying marketing and sales documents online