Reflections on the BPF Residential Summit

Reflecting on the BPF Residential Summit, Paul Winstanley of JLL offers his thoughts and opinions on the influence of the Build to Rent sector.

Paul Winstanley, Head of Living Strategic Advisory at JLL | BTR News
Paul Winstanley, Head of Living Strategic Advisory at JLL.

The challenges and tragedies that the last few years have brought have created panic and hardship in every sector across the globe. Successfully navigating through this, the Build to Rent sector, however, has thrived under the pressure. Whilst there is a promising element to investment in the Build to Rent realm, there is also long-term opportunity. Paul Winstanley of JLL reflects on the key points and takeaways from the British Property Federation’s (BPF) Residential Summit.

By Paul Winstanley, Head of Living Strategic Advisory, JLL

The British Property Federation’s residential conference entitled ‘The Next Level’ certainly did not disappoint. Hats off to the BPF events team who once again delivered a dynamic, thought-provoking summit agenda which purposefully had the needs, hopes and aspirations of real people who rent their homes firmly at its heart.

It is no secret that we are all living through challenging times – and have been for a while. From Brexit to Covid, from Covid to the cost-of-living crisis, and from the cost-of-living crisis to tightening monetary policy and rising interest rates, I can’t recall in my 25-year career to date a tougher string of economic events and shocks to contend with. Yes, we had the GFC which was awful at the time, but either side of it saw periods of comparative prosperity. This time around, it has been something of an economic rollercoaster ride since 2016 in so many diverse ways.

Yet despite the external economic environment in recent times, this conference subconsciously reaffirmed that Build to Rent has not only established itself as a viable asset class here in the UK but has endured, flourished, and grown substantially from its humble beginnings in the early 2010s. Around 80,000 Build to Rent homes are up and running and over 175,000 are in the pipeline.

Build to Rent in 2023 isn’t of course the finished article; irrespective of progress to date. Debates here showed me that lessons are being learned, processes are being improved, internal and external design is evolving, and more holistic thinking across the board is certainly enhancing product and investment return. 

On the risk side, the clear messaging was that we need to ensure that a viable investment framework is maintained, despite growing political murmurings about rent control designs in London and the awaited detail of the Government’s planned rent reforms. The tone at the Summit was one of restraint, not resistance. Investors have to play the legislative and regulatory cards they are dealt; we collectively need to seek to ensure those cards are competitive for the scale of capital we continue to need.

But encouragingly, it increasingly appears that hearts and minds feel like they have been won across the political divide. In their respective comments, it was heartening to hear both the Labour Deputy Mayor of London, Tom Copley, and Conservative Minister for Housing, Rachel Maclean MP, acknowledge the positive role Build to Rent is playing in providing new housing of quality and scale with sustainability at its core and delivering a rental experience which has raised the bar.  

The path forward is not likely to be straightforward or lacking in layered complexity. Irrespective of the political will and proof of concept for Build to Rent as a product and investment opportunity now, that doesn’t make new development magically happen or numbers miraculously add up. The planning process is complicated, viability is challenging, sustainability is embraced but not optional (and comes at a financial cost), and housing supply isn’t likely to get anywhere near to present or future demand levels in the foreseeable future.

Yet it felt that attendees at the BPF Summit were provided with a guiding beacon which could help point us all towards the light at the end of the economic tunnel the UK finds itself in at present. My key takeaway was that there is both hope and, simultaneously, a clear long-term opportunity with the inevitable supply/demand imbalance which keeps worsening. 

And, crucially, there is not just hope on its own, metaphorically flapping around in the wind. Instead, we have structured hope, imbued with recognition of the importance of offering renters today and tomorrow a much better experience than they are used to in the traditional private rented sector. We also have wide-ranging industry skills with a growth mindset and delivery expertise to make it happen; a crystalising vision of what good looks like; and the resultant interested investment capital.

In the end, home ownership may remain the long-term political aspiration and social housing the long-term societal necessity. But, in between, even if quietly, Build to Rent and living sector institutional grade investment will be essential in providing the rental homes in the private market, not only to complete the UK’s housing continuum, but also to propel it forward.

As for me, I remain as confident as ever in our industry’s ability to meet that challenge head on – and this year’s BPF summit reaffirmed my beliefs.