The build to rent (BTR) market is constantly evolving and the detail required to produce a successful scheme, can often get overlooked. The process of delivering a development from concept stage through to stabilisation requires a diverse, broad range of skills, along with a large slice of patience and commitment to see the job through.
The BTR sector, which sits within an already complex profession of surveying, can easily be broad brushed. However, schemes which ignore the ‘under the surface’ work such as demographic research, scheme design with day-to-day operation in mind and tenant demand, will likely fail in getting off the ground without a significant rethink.
The surveying occupation is often one which is difficult to describe and pinpoint the exact skills required in the profession. However, as chartered surveyor, there are some key core skills that are integral to achieving success in the BTR sector.
I have picked out some key attributes which are central in succeeding in the BTR industry.
Enthusiasm and Commitment
Staying up to date and taking time to ‘read up’ is necessary to succeed in the industry given the ever-changing market climate and legislation, i.e. the ongoing Parliament debate around cladding following the Hackitt report carried out after the Grenfell Tower fire. This for example has significant effect on development.
I may labour this point, however BTR projects can take a great deal of time from design, through to planning and marketing a scheme, not to mention the months of legal work on a forward funding agreement (the most common form of transaction) – commitment is required to see this through to financial close.
Communication
BTR is still relatively new and advice is highly technical, therefore good communication skills, whether written or spoken are vital, whether this is conveyed through presentations, reports or conversations. We need to make sure the advice and findings we provide come through clearly. For example a valuation report will need to state the Market Value, explain how the surveyor arrived at this figure and provide comprehensive evidence to justify their valuation. Often surveyors are required to explain and support their findings, this could be explaining why an asking price has been set at a certain level or why build costs have been assumed at a certain £psf rate. When surveyors present their advice and findings through written reports, emails or presentations they need to be clear and concise in covering the relevant information whilst putting across a professional view.
Cool, calm and collected
A prudent surveyor is able to keep calm under pressure which often applies to agency surveyors who need to negotiate between a vendor and a purchaser, trying to achieve the best outcome possible for whichever side they are representing – something which may also be time sensitive. Various complications will often arise whilst delivering a BTR project, it is important not to panic and to consider all avenues to find a solution.
Socialise
It is important for surveyors to be able to confidently develop and maintain a network of professional contacts throughout their career, this of course is not exclusive to agency and every surveyor should make an effort to build their professional network. These contacts could be peers, clients, alumni, ex colleagues and other surveyors one might bump into whilst having a Thursday evening visit to the pub. This helps enhance BTR and industry knowledge whilst keeping up to date with the latest news, requirements and transactions.
Team working
Collaborative working and taking initiative is important for the success of a firm and career advancement for individuals. Taking responsibility will improve learning and decision making. The support of a team will assist with upskilling quicker and ensuring advice is robust.
This is illustrated within the Allsop Build to Rent team, the scope of knowledge required to be an all-encompassing “BTR know it all” is far too far-reaching for one person; as such the Allsop BTR team is made up of personnel from multiple specialisms. This ensures we are able to offer the full skill set and services required for the multi-faceted asset that is BTR.
No two BTR schemes are exactly the same. Through our research team we are able to provide expert advice on macro and micro demographics such as population statistics, average earnings, consumer affordability, tenant demands etc. this will result in fundamental decisions that need to be made with design from the outset.
Our research and agency team look at the development pipeline, identify the target market for the scheme and a recommended mix of units to maximise the pool of potential residents, alongside the provision of amenities suitable for the likely resident demographic. Whilst our consultancy and operations team use this data to influence their advice on levels of shared amenity, design and layout of a scheme, marketing strategy and staffing requirements. This all effects the operational running costs of a BTR development, which impacts on overall GDV; a slight change in the operational costs effects the net operating income which can have a substantial impact on the GDV and overall profitability of a scheme.
The BTR investment and development team run a live development appraisal concurrently through the design process to ensure the balance of development costs, design, investment pricing and operational considerations are in equilibrium o ensure a viable development. Throughout the entire process, the investment team feed in market sentiment and requirements to advise the wider team on how certain design features / rental assumptions affect pricing and investor appetite.
Numbers and formulas
Big numbers combined with formula are a core part of surveying, whether it be the way the value of a property is calculated, a cash flow of a development and how to determine the NIA of a retail unit. It is important to understand what the approximate result should be and not just rely on the use of computerised software. If a single input is entered incorrectly then it can skew the whole appraisal.
So, to finish…
Taking all of the above into account, how do I, as a surveyor and member of the team, apply these traditional surveying skills to this newly emerging sector? The truth is, in all ways. The BTR sector requires multi-faceted skills as it incorporates a wide range of expertise across different disciplines. BTR is a commercial grade investment but a residential product and requires an understanding of planning, land, viability, development, design, management, consumer drivers, letting, valuation, investment and people skills.
So, just as a general practice surveyor is required to use their communication, written, interpersonal, numerical, enthusiasm and negotiation skills, the same abilities are required for a BTR surveyor, who needs to make sure they are attentive to all core facets of an emerging sector.
