Greystar directors working on suburban build-to-rent product for UK

Greystar builds one and two-person homes in its native US, where it calls them ‘garden-style’ apartments. Schemes typically feature several smaller buildings of no more than four storeys, with landscaped outdoor areas. 

Garden-style apartments form a significant proportion of the landlord’s 746,000 homes in the US, and many are built in Greystar’s modular housing factory in Pennsylvania.

Greystar is “actively working on” bringing these low-to-medium density homes to the UK, Ms Renshaw said, adding: “Watch this space. We can see there’s a need for it.

“It’s the right market to be going into at this point as well. Lots of people need good-quality rental housing [who] live outside urban areas.”

The firm has long managed single-family homes in the US, and recently launched an investment business to develop them as well.

Asked if it will enter the single-family market in the UK, Mr Mowbray said: “We’re looking at it, exploring it, but we haven’t done it yet”. 

Ms Renshaw, who joined Greystar in December from developer Pocket Living, explained that Greystar would like to develop its own single-family homes in the UK rather than buy existing stock. She added that her biggest focus is driving Greystar’s development pipeline.

“A lot of that over the past few months has been talking to the powers that be about what we need to create the right environment for development to come forward,” she said.

If investors don’t get a return that is “commensurate to the risk that they’re taking with their money”, funding will flow into buying existing schemes.

“Which is great for Greystar, because then we buy and operate more homes, but it’s not great for London or other cities, because there are no more homes being built.”

Construction costs “are about to go up again”, Ms Renshaw continued. “We can feel it, because energy costs are going up, so we know what we’re on the cusp of.”

Meanwhile, there have been “so many changes to building regulations over the last five-plus years, most of it unexpected and every time adding more cost”.

The government has announced an emergency package for London house builders, including Community Infrastructure Levy relief, but Ms Renshaw says this tax break “only helps until October”, after which developers will be charged a new Building Safety Levy, “and that’s equal to about the same about of money”.

She called for the date of the Building Safety Levy to be “pushed out a few years to recognise that we actually need more homes”. 

A Ministry of Housing, Communities and Local Government spokesperson said: “The Building Safety Levy strikes the right balance between raising funds to ensure homes are safe, and minimising impact on housing supply.

“We delayed the implementation last year to give developers more time to prepare and no further changes are planned.”

Mr Mowbray said Greystar is currently looking to buy existing schemes, refurbish them with new technology and use the landlord’s “massive operational platform” to drive efficiency.

“It’s not like you have to buy stuff that’s 30 years old,” he said. “It’s stuff that’s built in the last five years. It’s just cheaper to buy than build.”

Greystar is reportedly closing in on a deal to buy 900 build-to-rent flats in Elephant and Castle, south London, from Australian developer Lendlease and Canadian pension fund CPPIB, in what could be one of the largest ever UK build-to-rent transactions.

It also operates age-restricted co-living buildings in the Netherlands, which it refers to as ‘young professional housing’. The landlord currently has one co-living building in Bristol that is restricted to non-students but sits under its Student Roost platform.

Asked if Greystar would develop co-living in the UK, Ms Renshaw said it is not actively looking for co-living sites but “it’s not been ruled out”.

Mr Mowbray said one challenge is that planning restrictions for co-living schemes can vary widely across different parts of England.

However, Ms Renshaw said Greystar has a preference for building student accommodation rather than co-living: “We understand student housing, so if you’ve got a site that works for co-living, it’s probably going to work for PBSA. So our preference will always be to do what we do well.”

Greystar’s 1,600-home Pearl Yard scheme in Bermondsey, south London, is currently under construction and the first building has hit practical completion. It aims to have the rest of the scheme coming online by the end of next year.

Ms Renshaw added that it is “fairly inevitable” that England’s courts system will be overwhelmed when the Renters’ Rights Act comes into force in May, and Greystar is working with other large build-to-rent landlords to engage with government around the reforms.

The act gives tenants greater powers to take their landlord to tribunal if they think a rent increase is unreasonable.

Last week, reports also emerged that Greystar and Abu Dhabi Investment Authority have appointed agents for the possible sale of their 974-home Fizzy Living build-to-rent portfolio.