Earlier this year, Investec published research showing that 91% of investors think ‘blended living’ schemes that incorporate a combination of build-to-rent (BTR), student accommodation, co-living, retirement living and/or serviced apartments will be commonplace in the UK within the next five years. Last month, Yardi and Property Week brought together a panel of residential experts to explore what makes a successful blended living scheme, the importance of good design and how tech can improve customer experience. Panel of experts Christian Armstrong, director of brand, product and technology, Get Living Mark Bladon, director, Investec Georgie Drewery, account executive, Yardi Systems Félicie Krikler, architect and director, Assael Architecture Beth West, head of development management, Landsec Simon Creasey (chair), consulting editor/features, Property Week Blended living schemes are already commonplace in the US – why do you think they haven’t yet really gained traction in the UK? Bladon: For a number of reasons. If you look at the most developed of those sectors in the UK, it would probably be purpose-built student accommodation and that’s only been going in one form or another in a meaningful way for about 10 years. In the US, the investor market for this type of product is much more mature. Also, the BTR market in the UK had a lot of false starts between 2000 and, say, 2010 where people were just not able to get developments off the ground, but that’s all changed now. People have taken a bit of a leap of faith and there is now trading product, so you can benchmark yields and you can look at it on a cashflow basis. So what we’ve seen is people that have been in a very specific ‘beds for rent’ sector have realised that they can leverage off their existing operational platform, off their infrastructure, off the location – there’s so many things they can now do to broaden their horizon. What are the key ingredients that you need to make a blended living scheme work for all residents, particularly in terms of things like amenities provision? Armstrong: Amenities are really important but you have to think ahead, do some research and speak to your existing residents and prospective residents about what amenities they would actually use. I’ve seen some stunning stuff on schemes like barbecue terraces and outdoor terraces and then it hits me that we live in the UK – this is not the US. So I’m going to be sitting there with my cappuccino on the outdoor terrace with the froth blowing off! Bladon: That’s where the skill comes in. These schemes still have to make a profit, so you can’t just keep pouring money in. Somebody described it as an ‘amenities arms race’. They’re almost turning student accommodation into hotels and then they’re charging students £350 a week. As a result, you might end up with a half-empty property. The most successful operators are going to be the ones that can find the right balance. West: That’s why I think we haven’t reached that maturity point yet – this amenities arms race is a very immature reaction to what people think is a single market and a single customer for this product, but there are loads of people who want this product. If we’re going to build housing that attracts a broad range of different people staying for a long time then we have to think about offering a variety of different affordability points. Bladon: I think there’s another issue that lends itself to a blended portfolio and that’s the power of building a brand that can be used across the whole lifecycle of your tenant. So you start with your student, then co-living, then they get into their mid-20s and they want to move into BTR. That [BTR] can take them from being single, to married with children and living in a three-bed, all the way up to potentially the age of 60, when they might move into...

The rise of the build-to-rent sector is changing the way we live – but gaining support from local authorities is critical to its success. Now firmly established in London, Manchester, Birmingham and Leeds, the market is also taking off in Scotland – but how is this market different, and what are the challenges for investors and developers? Yardi brought together a panel of industry thought leaders to discuss the main issues. Iain Murray, managing director, LIV Consult Dan Cookson, digital innovation consultant, Homes for Scotland Christa Reekie, commercial director, Scottish Futures Trust Rick de Blaby, deputy executive chairman, Get Living London Peter Carus, associate, GVA Claer Barrett, Financial Times (chair) CB: How does the Scottish build-to-rent market differ from England’s?   IM: Looking at demographics, earnings and the overall rental market, Scotland is not that different from Leeds, Manchester or other big English cities outside London. Lots and lots of people rent. The difference is that Scotland, at the moment, is behind the curve. The Independence Referendum [in 2014] created a great deal of uncertainty, which held the market back. Talk of a second referendum had the same effect. If that were to start up again, investors would begin to get nervous. For now, investors seem to have got over Brexit and the ‘indyref’ – their money has to be put somewhere. PC: The key difference is that build-to-rent is taking its time to get going in Scotland. At a national level, there’s clearly been a big push. Now that’s beginning to come down to local government level and the planning authorities are supportive of new build-to-rent projects. RdB: The further you get from London and the South East, the more open for business local authorities are. The planners in Glasgow have been very receptive, and the new planning advice note that has recently come from the Scottish government is very useful too. IM: It does help that Scotland has a majority government too. CB: How are Scottish leases different – is this a problem for investors? RdB: The Scottish residential lease is distinctly different. When a tenant leases an apartment, effectively they have indefinite security of tenure. That might put some investors off; it certainty doesn’t put Get Living off as our model seeks to accommodate longer resident commitments anyway. IM: As a build-to-rent management company, our clients want people to stay for as long as possible. Turnover in tenancies costs money. CR: The Scottish system creates a lot of certainty for tenants that simply doesn’t exist in England. IM: Scottish leases are something that will put investors off if they don’t do proper research. Some build-to-rent investors will have an endgame of eventually selling the flats they develop. And they still can. There are extensive grounds for ending a lease and evicting the tenant; reasons include that you are selling the property, it is being refurbished, they have broken the tenancy agreement, they are being anti-social. As a build-to-rent management company, we are quite keen on this legislation as it gives me additional security. But from a conceptual point of view, investors outside Scotland may find it difficult – anything different from the norm, and some investors will think it’s easier to put my money in Manchester or Birmingham. CB: How have you changed your business model for the Scottish market? RdB: There are three, possibly four, cities in Scotland where build-to-rent could work. We have bought a 7.5-acre site to the east of the Merchant City in Glasgow, and we’re about to submit a planning application for 727 private rental with 99 student units. Our model is all about scale – we don’t do under 500 units. It is tempting to take what works in London and replicate it. But our focus groups in Glasgow have provided some valuable insights. For example, renters up here in Scotland don’t do as much apartment sharing as those in...