Build for People.

A new market is emerging. Build to Rent (BTR) is going to transform how people live in cities around the world, but it means thinking differently about property.

Woods Bagot has been delivering Build to Rent schemes across the US and UK for several years. In that time, we’ve learned that the most successful companies take into account the needs of their tenants into how they build and how they operate.

The market is changing 

In most global cities, house prices are still rising. There’s a lot of talk about “the death of the first-time buyer”, and a lot of anxiety that the market can’t support people looking for a home.

But we believe that concepts like “ownership” are changing.

Millennials have a different relationship to property. Where the baby boomer generation define themselves by the things they own and lay down roots when they find a home that works, millennials don’t. They pride themselves on flexibility and portability. These are people who stream music and films and use car share schemes. They have different needs from property. 

Meanwhile, in the UK many over 55 want to downsize, but only 3% end up doing so1. What's the main reason? They couldn’t find somewhere appropriate.

There’s a huge opportunity to offer these groups something suitable. These are people at different ends of what we think of as the ‘rental lifecycle’, a cycle we think will come to define Build to Rent development.

The rental lifecycle

Successful Build to Rent operators are large companies with thousands of apartments across a portfolio. For companies like that, it’s important to keep people moving within a portfolio – retaining tenants rather than attracting new ones. Doing that successfully means thinking about how tenants will live over the years.

It starts with sharers. Whether they’re students or corporate sharers, these are properties where the main factor is location; places where people build upon communities.

When they leave that property, some might move into single occupancy flats, some might move in with a partner, some might go on to have children. Those all mean adding different kinds of unit to a portfolio mix.

Supporting people through that journey is extremely valuable. The more valued they feel as a customer, the more likely they are to stay with a particular supplier. At each step, operators need to be offering solutions to tenants that seem custom-made to meet their needs, but don’t eliminate their profit. 

Supporting life changes

Moving usually follows a life-changing event. Parents need to be somewhere where their children can attend a good school. There might be a need to relocate because of better career choices. It might be a time where partners separate. People don’t tend to move by choice.

That’s less true in a rental landscape. Tenants are more light of foot; they can move because they fancy a change, and will. Operators are going to have to think carefully about how they facilitate that. 

It’s not about saying, ‘Okay, fine. We’ll end the tenancy and then you can turn up at the other place and you can sign the new one.’ It’s all about helping people make the move to minimise the opportunities for them to feel the need to look elsewhere. 

What does that mean for the design of these properties?

It means spaces are designed to be refreshed quickly, modularising the building so you can switch amenities in and out easily. It means planning for 3-day turnarounds, so that when one tenant exits and the next one comes in, everything is reinvigorated in three days. It means planning for access to pipes and wires and electricity, with corridor-facing showers and kitchens that maintenance teams can reach.

All of that takes thought and research, understanding the way people use the spaces they live in. That happens by understanding what different people need at different stages in their lives. That way, tenants’ lives are improved by the homes they live in. 

Know who you’re building for

At Woods Bagot, we’ve worked out what’s important to the people living in apartments that fit this lifecycle by analysing things we’ve designed that we know work well. This has helped us establish high-level principles for Build to Rent design as follows:

  • Create opportunities for personality
  • Make durability a cornerstone
  • Build storage solutions tenants value
  • Be flexible
  • Add amenities that enhance the neighbourhood

Each of these principles is like a dial: they dial up and they dial down as tenants move through different stages of their lives, but they’re crucial throughout. 

Composition is fundamental

At Woods Bagot, our computational design team SUPERSPACE builds data analytic tools, which help us design buildings that optimise their development potential and make the most of their surrounding neighborhoods and amenity.

An apartment block in which all the flats need natural light might have a core, containing things like a game room or a screening room. These amenities naturally complement sharers or single-bed apartments.

Meanwhile, families want easy access to the neighbourhood and surrounding area, so we can position two-bed products closer to street level.

This narrative begins to describe an interesting building. Amenities are stacked towards the top, providing better connections to the neighbourhood at the bottom. It is a natural layout for Build to Rent block, but the inverse of how many apartments are stacked now. This kind of composition activates an entire building. Developers can start thinking about spatial design and management, taking the ideas of the street and placing them in buildings.

In our model, the areas traditionally reserved for “penthouses” are smaller, occupied by younger tenants. These flats are the entry point for people who might stay in flats in your portfolio for decades to come, throughout the various stages of their lives. They are the kind of flats a tenant’s friends might see – and envy – which is hugely valuable in the long term.

This changes the marketing process for apartments

This is a new model for city living, which demands a new approach to marketing. Private rented sector (PRS) operators need to think of their portfolio as a brand, something that people will want to come and be a part of. 

All the touch points should feel consistent. Everything from the materials used across a development, to the attitude of the concierge, to the designs of the advert and brochures. That’s something other industries have perfected, but it’s a new concept for many developers.

Tenants should have the same kind of experience across a development. Not exactly the same offer since every building should have its own character. But the way a tenant interacts with a landlord should feel similar across the brand, regardless of whether they are in a studio flat or a three-bedroom. 

This market will change London

It’s fundamental to understand how people live in spaces - how they use rooms, what they need, and how they live in a local area.

Developers have to start with questions like: ‘What are the benefits of this neighbourhood? How do we design specifically to take advantage of them?’ That’s crucial for getting Build to Rent right.

If we start by thinking about how people use spaces, and how that changes over time, we can deliver amazing properties people will stay in for a long time. That’s going to be a valuable commodity for decades to come. 

Apartment typologies

Sharers: Likely to engage in shorter-term tenancies. Living spaces are probably neutral. Personal space is the most important aspect for them: they’ll use these spaces to retreat to. The facilities within a specific apartment matter less than the amenities close to them, and they may use these spaces within the building to entertain friends and family.

Adventurers (Single): This will be their first time to truly personalise a space. They might live in a studio, but it should feel like a small one-bedroom apartment with defined living, sleeping and kitchen ‘zones’. However, like a sharer, decisions about renting aren’t driven only by the apartment facility; they’ll still be heavily influenced by the amenities within the building.

Curators (Couple): They’ll have an increased need for storage space, and are beginning to curate their lives together around things they own. As their relationship develops and their family changes, the apartment will need to adapt; flexibility will be crucial to them.

Biographers (Family): The family will use the surrounding neighbourhood more than the amenities in the block, and their storage needs will increase over time. They’ll want opportunities to showcase family interests and achievements, and the facilities within the apartment are important, especially as children grow up in the home.

Librarians (Last-time renters): These people need a space that allows them to display the collectibles acquired over their lifetimes, so flexibility within the apartment is paramount. The amenities will also be essential in meeting the needs that develop as tenants age. Their homes need to feel like a sanctuary.

[1] Legal and General Assurance Society Limited, The Bank of Mum and Dad, pg. 3, 10: https://www.legalandgeneralgro...

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