Earlier this month, Moda Living announced it had teamed up with leading global investor Ares Investment Management to deliver a new single family housing product, with an initial target to deliver 5,000 new homes for rent, at an accessible price point, by 2025. This week, Moda revealed the new venture will be branded Casa, and will integrate all of the Build to Rent giant’s core brand values and services.
We caught up with Casa by Moda Head of Acquisitions, Rob Gill about the business’s plans.
Why has Moda Living moved into the family homes sector?
This is a massive growth sector within the UK residential market. There are currently 21 million residential properties in the UK – 20% of those, meaning four million properties, are rented. The housing shortage in the UK equates to a requirement for 300,000 new residential properties per year, and at least 20% of those should be purpose-built rental properties. This is compounded by the fact that tax changes for individual landlords have rendered buy-to-let less profitable and therefore less desirable.
The asset class is also very defendable. In the more mature US market, vacancy rates are very, very minimal, so the income is very stable.
How much demand is there for single family housing in the UK?
There is huge demand. We’re seeing growing appetite for rental properties, based on a number of key factors such as affordability, accessibility to debt, and a more transient lifestyle in terms of access to employment.
But the fundamental point is that there are four million households across the UK that currently rent and there are currently little to no choices when it comes to good quality, institutionally managed stock.
What is the biggest challenge faced by the sector?
The biggest challenge by far is land procurement – but Moda is in the unique position of being both vertically-integrated, so we can dedicate people to a site from acquisition through to stabilisation, and also already backed by a major institutional fund. We are incentivised to defer our profit margins until a point in the future, which allows us to minimise our overhead costs and profits on entry, which a lot of the competition can’t do. We’re actively ready and on the lookout for sites across the UK – ideally starting at around 50 units on at least two to three acres of land.
How else will Casa distinguish itself in the single family housing market?
Our focus on customer service. We are encouraging and facilitating communities with services and initiatives filtered through from our established Build to Rent platform. This includes the bespoke app, which will give residents 24/7access to the Casa operations team.
It also gives them the ability to communicate directly with other tenants that are sharing their community on site. Casa is a modern, purpose-built Build to Rent product designed for modern living for all.
What will the benefits be to residents living in Casa neighbourhoods?
Casa residents will benefit from the absolute focus on customer service, health and wellbeing that people enjoy across the Moda Living portfolio. Our partnerships with leading brands such as Sky and Samsung give them access to best-in-class technology. This ranges from white goods to tech such as smart building management systems through our partnership with Utopi, which will help residents manage and process their energy in a more efficient, sustainable way.
In terms of place, the communities will have the benefit of beautiful homes with open plan spaces, designed to maximise natural light with an emphasis on contemporary interior design. The homes will be complemented by huge amounts of public spaces, including new parks and amenities. All of the Casa neighbourhoods will be designed and laid out to foster long-term communities, and to allow our residents to truly live the Moda life.