Build to Rent Services Allsop have Contents undertaken “ 1. Allsop in numbers bespoke 2. The market demographic 3. Research and consultancy analysis on more 4. Management 5. Valuation and viability than 50 locations 6. Investment and development agency – UK wide 7. Why work with us? 8. Case studies 9. Client testimonials ” 10. Contacts

2 Build to Rent Services Build to Rent Services 3 1. Allsop in numbers

Allsop have to “date advised on over £1.2bn of specialist Our coverage ALM manage over BTR investment/ £1.5bn+ development worth of residential property in the UK and valuation Client Survey projects 95% satisfied with service level provided Top 10 ranked Investment Agency Practice 0 ” £1.4bn transacted in the last year

Ranked

14th UK property consultants on overall turnover 2,628 property transactions completed in the last year. That’s almost: 1* an hour, 9* a day, 46 a week, 197 a month (*a working day)

Over the last two years approximately 10% of the investment portfolio market transacted by Allsop’s National Investment Team £1.034bn in the last year sold at auction Ranked number 1 auctioneers in UK

During the 2010 Revaluation

£70m+ savings for retailers Valued over on business rate appeals £13bn of property in the last year

4 Build to Rent Services Build to Rent Services 5 2. The market

Everyone needs to live There has been much publicised around the weight London has taken back the majority gain of BTR somewhere. With the of money chasing UK purpose built residential rental homes with approximately 72,767 and 66,741 in combination of the long term developments from all corners of the world, the regions, with schemes in the regions having however we are now seeing who is actually outnumbered London in Q2 2018. shortage of housing and people’s investing and we are able to identify the specialist Here at Allsop, we have been busy working with expectations of better quality developers making BTR schemes a reality. housing, BTR is offering investors a large number of these active investors and The BTR sector is now firmly in the ‘development developers on a range of levels, advising on all a secure long term investment phase’, with the focus having shifted towards specialist areas within the emerging asset class. platform, robust to the wider construction of schemes and stabilised stock This service overview summarises our range of market concerns. As other asset management, including mobilisation of assets. expertise on all facets of BTR. We do not believe The British Property Federation (BPF) latest figures classes suffer from a range of that one single person can be an expert on all demonstrate this shift into the construction phase, uncertainties (we try not to things BTR, therefore the cohesive and joined up estimating an impressive 29,416 units completed mention the ’B’ word), large scale, approach Allsop has taken in combining skill sets and 43,374 under construction. The BPF estimate institutional grade residential to provide best in class advice is the next best thing. a further 66,718 units with planning permission. investment is proving attractive.

Valuation Research & Consultancy

Investment Management

Analysis & Development Viability

6 Build to Rent Services Build to Rent Services 7 3. Research and consultancy

Importance Our approach The team A joined up style Our approach • Consideration of customer of research to research to consultancy experience. Emma Hart is principally Having been involved in numerous • Development of a viable, Good research and ‘market There is no directly transferable responsible for our BTR research, BTR schemes across the UK, Working alongside architects, efficient and deliverable intelligence’ is crucial in order to blueprint for BTR. The viability of specialising in assessing the the team is able to provide planning advisors, project management budget. fundamental market drivers and consultancy on a wide range of thoroughly assess the viability of a a scheme is linked to the nuances manager’s and the wider design • Key inputs to and creation demand for rental product key BTR components, including; BTR opportunity. BTR schemes are of the micro-market and our team enables us to collaboratively of a working development at a granular, local level right management and operations, unique because they are long- clients strategic objective, create the best bespoke BTR appraisal and investment GDV. term commercial grade therefore our research is bespoke through to overarching market research and capital markets. proposition for a site. investments, with long-term to each client and is adapted fundamentals. Every element of the BTR advisory Other consultancy services include: residential rental occupation to suit individual developments. Emma is assisted on the research service can be utilised during The team in mind and therefore • Shaping product design, mix, Of course there are BTR by Vicky Lynch and George this phase to ensure careful comprehensive analysis of layout, amenity provision and Led by Andy Pointon and Lesley ‘fundamentals’ for ‘base case’ Metcalfe. consideration at every part the micro-market is required. specification for the demographic. Roberts, our consultancy services scenarios, however a product of the process, resulting in • Developing a product and service can involve every member In order for a BTR scheme to be varies in relation to the market so maximisation of value. proposition for the target audience. of our BTR team to provide successful, market research must one size doesn’t fit all. We work a comprehensive service. inform three essential principles. closely with our clients to • Cost vs benefit assessment of Firstly, what to build; including understand their requirements amenity, service, life cycle, product design and the amenities and add value at every level management provision with that should be provided; secondly, through tailored research. consideration for place making value and return; here research and design efficiency. must determine rental income and the best management strategy; finally, the proposition for investment; an understanding of how the market will respond and The team has experience in research the likely investor profile. Research and analysis for many different types of helps inform each of these strands. build to rent products across the UK and Our expertise and insight is instrumental in determining “has excellent capacity to access data planning, viability, due diligence and identify trends. We collectively tap and to inform further detailed consultancy. into our industry contacts and use our 100,000+ database of clients, investors, and residents, plus data from units under our management. ” 8 Build to Rent Services Build to Rent Services 9 4. Management

Allsop Lettings and “ Management operate over 5,000 Management matters Our approach to The team residential units A thoughtful and comprehensive management Operating from our UK wide management strategy is critical to Allsop Letting and Management network of offices, the team is nationwide and creating a successful BTR scheme. (ALM) was established in 1990 and led by Lesley Roberts assisted by The management of an asset provides a specialist build to rent Matt Smith and Kelly Smith. Lesley, specialise in fundamentally determines the team which offers end-to-end Matt and Kelly have over 45 bottom line, whilst also shaping management solutions tailored years’ experience in the strategic institutional grade the complete resident and to optimise each asset and management of large scale customer experience, setting collectively portfolio returns. residential assets and portfolios Build to Rent assets the tone for the entire scheme and bring innovative and solution and its future success. The team combines the extensive focussed approach. experience of ALM in managing Exemplary management begins at large scale PRS portfolios, with the The operations team has inception; influencing investment breadth and depth of residential dedicated mobilisation, decisions, design, operation and investment experience at Allsop. operations, lettings, management, ” ultimately delivering perpetual value. marketing finance and IT Operating nationally, clients professionals, all of whom Value to investors will rely as much already benefitting from our specialise in their respective upon efficient and strategic service include; Realstar, Grainger, functions to ensure all bases are management, as locational PWC, DTZ IM, Shell, Dorrington covered from throughout the characteristics and underlying and Moorfield, providing services entire process. property values. Allsop provides a such as:- holistic and efficient management With over 50 staff across London, solution which ensures a laser • Product design and specification Brighton and Leeds, as well as 40+ sharp focus on the crucial • Service offering operating on-site, the team has ‘Gross to Net’ operating margin, • Resourcing the depth and experience to importantly, we do this without • Facilities, block and property meet the most challenging of compromising the essential management client objectives. customer experience. • Marketing • Lettings • In-residence care • Budget management • Fund reporting

10 Build to Rent Services Build to Rent Services 11 5. Valuation and viability

The value of a well- Our approach The team considered valuation to valuation Andrew Wells and Rob Austen are Accurate property valuation is An ability to reflect the market is the Allsop partners principally essential for informing investment undoubtedly much easier to responsible for our BTR valuation, strategy and decision making, and accomplish by having close links having specialised in this emerging when it comes to a nascent sector to those in the market. The sector over the last decade. like BTR, experience and insight knowledge, experience and Andrew and Rob are assisted by are essential. expertise of our agency and Ciaran McGivney. Demographic management team members Boasting an enviable list of BTR input is provided by Emma, provide our valuers with first hand case studies, our specialist valuers George and Vicky and exposure to transactions fundamentally understand the management insight from Lesley. happening in the market. More nuances of this asset class. Having importantly, market intelligence worked with a broad client base also gives invaluable information on a range of single and mixed about the nuances of different use developments over the past investors and their individual two decades in the private, public methods of arriving at bid levels; to and charity sectors, our valuers are this point no two BTR investors take able to use their breadth of exactly the same approach. experience to assist with value engineering opportunities and We also have the benefit of a maximising property value for the well-established bespoke BTR Allsop value for both benefit of our clients. research offer which provides us with the key skillsets regarding Our valuation service provides analysis of demographics and lenders and investors robust asset and rental value market fundamentals for larger assessments that inform viability, “ scale residential investment as well who are active in design, planning and the potential as management expertise to feed for alternative development into understanding operational options. Also essential for the BTR sector matrics. borrowing, tax planning, ” acquisition and disposal.

12 Build to Rent Services Build to Rent Services 13 6. Investment and development agency The agency team advises “ investors, developers and landowners on all aspects of build to rent opportunities throughout the UK, assisting Proven skill in forward Our approach The team to maximise returns, manage funding transactions to BTR Investment Led by Andy Pointon, the agency risk and support long-term Structuring complicated forward & Development team comprises James Wilson, Andrew Boyd and Sam Verity who funding agreements in an We are advocates of sensible collectively cover the national investment. emerging asset class is a difficult assumptions, that are defensible, market, ensuring our BTR expertise process. However, with our when analysing a potential crosses the country. The team is substantial experience BTR development. Of course, supported by Ciaran and Olivia of agreeing such structures, components change from scheme Bentley, whilst benefiting from the we understand what solutions are to scheme and will depend on operational expertise of Lesley, ” at our disposal when assessing the micro and macro factors, Matt and Kelly and the valuation suitable transactions. understanding these nuances knowledge of Rob and Andrew. Our agency and valuation teams results in a solid starting platform in are more closely aligned when understanding a scheme’s potential. We have a UK and international investor reach. Through Allsop’s compared to other real estate Other considerations include; alliance with Millennium Group we investment sectors. This is important ensuring a range of unit types have strengthened our services to to underwrite defensible across the scheme, assessing the Asia-based investors looking to assumptions and investment criteria development pipeline, understanding deploy capital into UK real estate. in an emerging sector, as up to the current competition and date market intelligence is key and ensuring the right balance results in achieving the best results. between controlling build costs, The BTR Agency team has advised programme and ensuring quality. on a number of schemes across The key components of the team’s the UK with a combined GDV in input are as follows: excess of £1bn, therefore, we understand what is needed • Continued guidance on the for institutional investment, from evolution of the development market intelligence right through appraisal to key components of a specialist • Effect on pricing from key BTR appraisal. changes to the scheme • Market intelligence in a quickly emerging sector • Partner lead advice • Advice on key decisions throughout the design process • Front line market knowledge and specialist contact base

14 Build to Rent Services Build to Rent Services 15 7. Why work with us?

When assessing a potential BTR development, there are a number of fundamentals we consider:

Joined up Viability and Research approach marketability

The location: how close is the potential development to transport The research team can recognise The investment team plays an From day one, we will run a live hubs, town or city centre, amenities, places of employment and the scope of the rental levels, active role throughout the entire appraisal alongside the design public spaces / parks. supply and demand in the market, process feeding in market process. This enables us to see the development pipeline, the sentiment, requirements and how how each decision made effects affordability of the local residents certain decisions would affect pricing and viability. From a and what is desired in terms of pricing and investor appetite. change in the unit mix, the amenity – assessing what amenity construction programme length or The rental market: what is the rental tone in the micro location, is already nearby and the type the alteration of the design which which schemes / areas are achieving the highest rents, how many of amenity which would set this affects operational costs, we are properties are on the market and how long have they been scheme apart from others. We are able to ascertain the effects on marketed for. Signaling the potential for absorption, affordability, also able to ascertain the optimum GDV, cost and profit. supply and demand. scale of the development. Effectively ‘future proofing’ the scheme as much as possible.

Capital values: generally we find that BTR schemes work best in locations where market sales values range between £300 - £800psf, benefitting from strong rental demand.

Acquisitions Marketing Management and disposals

Design: every scheme is designed differently. However, from our experience there are key characteristics that should be considered when it comes to design. The best time for the team to enter the design process is at the very Whilst the above highlights our We like to progress schemes as far We will produce a bespoke beginning, before pencil has been put to paper. approach to consultancy and as we can before going out to the management budget for the disposal of a BTR scheme, we are market, preferably after planning scheme to understand the gross also retained by a number of has been submitted. Having carried to net efficiencies. The team will institutional investors to give out the above processes we will also advise on design and layouts acquisition advice. This service can have helped produce a well with future operation in mind. be tailored for each circumstance, thought through scheme. Getting Management: considerations for operating costs and efficiency. whether it be full investment the vision to this position we Product, service proposition and deliverability is essential for short underwriting, purchase reports, are able to showcase the depth term viability and long term success. We can quickly establish management consultancy or of detail, backed up by research management scope from outline development information. demographic research. and market intelligence.

16 Build to Rent Services Build to Rent Services 17 8. Case studies

Fabrik, Leeds Role: Investment. Scheme: 216 units comprising a U-shaped building around a central courtyard. Amenities include: Residents lounge, gym, concierge and on-site management. Allsop were brought in to advise on the pre-designed scheme and instructed to source an investment partner. Exchange of contracts has been achieved subject to detailed planning with a UK institutional investor. Construction expected to commence in Q2 2019.

18 Build to Rent Services Build to Rent Services 19 8. Case studies 8. Case studies

The Landmark, Derby The Keel, Liverpool Role: Consultancy advice and investment. Role: Consultancy and valuation advice. Scheme: 201 efficiently designed apartments located over 17 Scheme: 240 high quality waterside build to rent storeys within apartments with on-site amenities and services. what will be the tallest building in Derby. Amenity includes: Two residents lounge’s, concierge and Amenity includes: Residents lounge, gym, coffee breakout area, on-site management. guest suite, concierge and on-site management. The first scale Build to Rent scheme delivered in the regions, Allsop were brought in to help advise on The Landmark in March the former HMRC office building, located on Kings Dock 2018, three months before planning was submitted. We advised on just minutes from Liverpool city centre, was converted to substantial changes to the scheme which transformed the design create a landmark residential building. Allsop provided into a BTR scheme and considered the long term operation of the strategic advice on local demand, the strength of the building. Planning on The Landmark was granted in Q1 2019. rental market, appropriate unit mix, desired amenities, The preferred investor was selected in August 2018 and scheme design and layout, an assessment of the construction is expected to commence in Q3 2019. management plan and an indicative valuation projection.

20 Build to Rent Services Build to Rent Services 21 8. Case studies 8. Case studies

The Forge, Newcastle Kent Street Baths, Birmingham Role: Management. Role: Research, consultancy and investment. in the Southside area of Birmingham, in addition to Scheme: 283 premium quality one, two & three bedroom build to Scheme: 406 apartments designed for renting, examining the wider Birmingham market; analysing rent units adjacent to the Stephenson Quarter in central Newcastle. comprising four residential blocks surrounding a central supply, demand and development pipeline. From this The first true BTR scheme in Newcastle. Designed over three buildings amenity hub initial research we were then able to provide consultancy and released in phases. and courtyard gardens. advice on the appropriate unit mix, design features of Amenities include: Gym, residents lounge, integrated lockers, post / Amenities include: Concierge, post / parcel room, the scheme and optimum layout. The day to day running parcel room, offers and discounts with local businesses, 24/7 resident on-site management, flexible amenity hub. of the management and customer journey was also service agents, ultrafast broadband and private dining / meeting space. Appointed in April 2017, Allsop’s Build to Rent team were considered when reviewing design and layouts etc. Allsop has been appointed as managing agent and are currently heavily involved in the project from concept design through During the design process, we were able to demonstrate mobilising the site. Our experience in mobilising and managing large to planning submission and eventual marketing for an the effects of key changes by running an operational scale residential developments has us well placed to advise on investment partner. budget alongside the development appraisal, meaning the various management strategies required to ensure the client’s Our initial process involved carrying out a thorough operational costs, build costs and overall value could be financial targets are met. demographic review of the micro location of the site considered with each change in design.

22 Build to Rent Services Build to Rent Services 23 Build to Rent Housing

8. Case studies As the BTR market starts to mature for City Centre apartment blocks, we are now seeing a large movement of interest into BTR Housing. Allsop are actively involved in a number of schemes of varying sizes and offering. This is an area that we expect to see substantial growth over the next few years as the large demand pool, liquidity and scale are attractive to investors.

The Trilogy, Manchester Role: Consultancy and management. Scheme: 232 apartments within three blocks. Amenities include: Gym, residents lounge, integrated lockers, ultrafast broadband, 24/7 residents service agents, work spaces, on-site management, terraced gardens, post / parcel managements and offers and discounts with local businesses. Allsop provided strategic advice on the demand and strength of the local market and later as part of the project team advised on specification and additional on-site services that could be offered to residents. Allsop have been appointed as managing agent and are mobilising the site to ensure pre-lets and lease up achieve the investor’s aspirations.

24 Build to Rent Services Build to Rent Services 25 9. Client testimonials 10. Contacts

Build to Rent

Investment and development consultancy

“Allsop bring a wealth of experience in managing rental properties to managing the Moorfield funds’ BTR assets. Lesley and her team Andy Pointon James Wilson Andrew Boyd Sam Verity Ciaran McGivney Olivia Bentley MRICS MRICS MRTPI MRICS MRICS MRICS Graduate Surveyor share our customer service ambitions, and have proactively Partner Partner Partner Surveyor Surveyor embraced new technologies and customer facing innovations to +44 (0)20 7543 6720 +44 (0)113 236 6679 +44 (0)20 7344 2609 +44 (0)20 7344 2693 +44 (0)20 7344 2601 +44 (0)20 7344 2638 deliver an outstanding and seamless customer experience to our residents. We look forward to working together on future schemes.” Management and operational consultancy Valuation

Sadie Malim Head of Special Projects and Legal, Moorfield Group

“Andy Pointon and his investment advisory team have been critical in navigating our BTR seed portfolio through the complex viability Lesley Roberts Matt Smith Kelly Smith Andrew Wells Rob Austen MIRPM MARLA NAEA Assoc RICS MIRPM MARLA MNAEA FRICS MRICS challenges around Build to Rent in a UK market that is still uncertain Partner MARLA Head of BTR Partner Partner about this asset class. Andy’s background of commercial expertise Head of Mobilisation Operations +44 (0)20 7344 2653 +44 (0)113 290 2516 +44 (0)20 7344 2622 +44 (0)113 236 6670 +44 (0)20 7344 2669 is especially helpful when applied to the nuances of BTR that don’t align with traditional residential assumptions but the whole team are proactive, thorough, open and engaging. Their genuinely collaborative Research and consultancy approach is refreshing and I particular value their ability to approach each scheme on its individual terms, rather than trying to apply one headline model that cannot reflect the inherently bespoke nature of BTR.”

Alex Notay Build to Rent Fund Director, PfP Capital Emma Hart Vicky Lynch George Metcalfe Senior Research Research Analyst Placement Surveyor Analyst “Allsop have proven themselves to be a market leading consultant +44 (0)113 236 6687 +44 (0)113 236 6674 +44 (0)113 532 9211 to the Build to Rent sector, providing support in a wide range of disciplines. Beyond their detailed focus and personal approach to projects, what really sets Allsop apart is the team’s comprehensive understanding of the day to day practicalities of the sector, using this insight to drive value for developer, investor and customer alike.”

Kitson Keen The team Head of Build to Rent, Home Group E: [email protected]

26 Build to Rent Services Build to Rent Services 27 Services

Asset Management Auctions Build to Rent Business Rates Development Agency & Advisory Investment (Sales & Acquisition) Lease Consultancy Letting and Management Office Leasing (Central London) Receivership Valuation

Contacts

Head office: 33 Wigmore Street, London W1U 1BZ Tel: +44 (0)20 7437 6977

City office: 2 Copthall Avenue, London EC2R 7DA Tel: +44 (0)20 7588 4433

Leeds office: 8th Floor, Platform, New Station Street, Leeds LS1 4JB Tel: +44 (0)113 236 6677

Brighton office: Princes House, 53-54 Queens Road, Brighton BN1 3XB Tel: +44 (0)1273 322 013

allsop.co.uk