Montagu Evans presents… Living

The housing debate has intensified in recent years, with the lack of delivery, affordability and tenant security at the forefront. Living forms of housing targeting specific social and demographic needs are increasingly being seen as a tool to solve wider housing issues.

The private rented sector (PRS) is the fastest-growing sector in the country. However, due to the speed of growth, it has lacked the ability to deliver consistently high-quality homes in a cost-effective and efficient way. The emergence of the build-to-rent (BTR) sector has capitalised on that with Institutions stepping in to improve stability, sustainability, security and professional management, benefiting both renters and investors.

However, we understand PRS can come under all shapes and guises, some of which include:

• Purpose Built Student Accommodation – As the UK increases as a central hub for education excellence, as will the need for accommodation.
• Co-living – A modern form of flexible housing with professional management, designed for communal living where residents share and collaborate in amenity spaces.
• Build to Rent – Dwellings specifically designed for the rental market, offering centralised professional leasing and management services, principally targeting young professionals and families.
• Key worker – Many key workers (such as nurses and teachers) where skills shortages are acute in London are requiring greater affordable living spaces to avoid employment shortages.
• Senior living and retirement villages – New options for seniors looking for a post-retirement lifestyle such as Retirement Villages, where urban senior living looks to continue to grow.

One, in particular, the Purpose Built Student Accommodation (PBSA) market has matured in recent years, shifting from an alternative investment to an established asset class with an estimated value of more than £50 billion in the UK. The growth in the sector has been driven by the structural supply-demand imbalance of PBSA, global brand strength of UK Higher Education, rapid growth in international student numbers (215% since 2000) and projected mobility of the global middle classes. In addition, the counter-cyclical nature of student numbers has helped underpin resilient granular income streams and attractive return profiles compared to other sectors.

The rapid growth in the sector has created its own issues, namely increased competition, spikes in supply in certain sub-markets, increasing planning contributions and policy, viability issues and rental affordability. To resolve these, comprehensive analysis is required, with consideration for planning to maximise site capacity and scheme composition to minimise operating and build costs to achieve the best value and client objectives.

Understanding these complexities requires rounded holistic advice that pulls expertise across sectors and specialisms. Working with private and public sector landowners, institutions, councils and developers, we bring together some of the brightest minds exposed to strategic land, viability, change of use, development, acquisition and disposal, alternative uses, joint ventures and partnerships to deliver a variety of private rented solutions.