The emergence of a Build to Rent model: The role of narratives and discourses

Abstract

This paper analyses ‘Build to Rent’ (BTR), a new form of tenure in London’s housing market. We examine the ways in which private and public sector actors have shaped the context of BTR’s emergence, and developed a model for delivery in London. We argue they relied on and constructed narratives of negativity about the private rental sector, which were juxtaposed with their product to position BTR as a solution to part of London’s housing crisis. Building on this, and leveraging an emerging but supportive institutional context, real estate professionals have adapted a US model to the UK. We argue that both the narrative-generating activities and the model development reveal tensions, which help theorise the ways new models of financing housing emerge.

Putting the crisis to work: The real estate sector and London's housing crisis

“…Two frequently drawn upon examples of 'new products' in our interviews were Build-to-Rent [BTR] and the idea of micro-living. There are now 60,000 new BTR units in the pipeline across London and it is consistently legitimated as a solution to the housing crisis in terms of both providing enough rental properties and delivering quality in the private rental sector (Brill & Durrant, 2021). Yet it has developed, from the outset, as an asset rather than as a form of housing.…”

“…Well-documented efforts have been made, in multiple contexts, to attract investors and to liberalise planning systems, with significant negative impacts on citizen welfare (Beswick et al, 2016). Narratives of crisis are used to legitimise such reforms (Brill & Durrant, 2021;Heslop & Ormerod, 2020), making investment processes easier and de-politicising development projects in the name of crisis mitigation. In short, the emergence of crisis narratives aligns the interests of private investors and developers, with those of regulators, citizens, and development-led planning systems (Colenutt, 2020).…”

Systematic Literature Review to Identify the Critical Success Factors of the Build-to-Rent Housing Model

“…However, recent investments into BTR models suggest interest and willingness to invest in such high-yield infrastructure assets. Such assets are built in areas with good transport systems in a city's peripheries such that it provides better land value for the developers and investors, such as in the case of London [6]. As Whitehead [40] highlighted, policies and lobbies focus on bringing institutional investment into the private rental market, providing a way to fast-track development and adoption of the BTR model.…”

“…It is further understood that younger generations, due to the changing nature of employment, might be disadvantaged in getting into homeownership as traditional forms of mortgages and home financing may not be available to them [34]. This gap has led to an increased interest in financing new housing through institutional investment, treating housing as an asset class, and developing hybrid market systems [6,42]. Since young adults in Australia are also limited by financial constraints, the development of diverse financing models for funding BTR development and acquiring rental tenure in such projects can be a major boost to the uptake of such projects in Australia.…”

“…However, with the involvement of institutional investors and presenting these housing developments as an asset class, the shift towards these types of housing infrastructures is imminent as they can present a better rate of return than other available investment options [5]. The concept behind the BTR model is that each block of the PRS may be managed by a single institution [6]. In this research, we refer to a single notion of BTR, which encompasses all nomenclatural iterations of the concept.…”