Published: June 9, 2023

The power of placemaking in build-to-rent property

Written by Amber Furr

Annual investment in UK real estate reached over £10bn in 2022 (JLL). According to Savills, an incredible £4.3bn of that annual investment was in the Build to Rent (BTR) sector – breaking the record for a fourth consecutive year.

Yields have proven resilient by comparison to other asset classes, supported by high demand for city centre living and strong rental growth. But as the economy and rental market stabilise, which type of BTR developments will make the best long-term investments?

This is where placemaking comes in. Developers who shape their residential offering around the needs and lifestyle of the people living there are the ones who will dominate the rental market for years to come. 

What is placemaking?

Winston Churchill said: “We shape our buildings and afterwards our buildings shape us.” While brick and mortar (or glass and aluminium), make up the physical form of a building, placemaking refers to the holistic approach to the planning, design and operations of the space and surrounding area.

Placemaking celebrates and capitalises on a local community’s assets and potential, with the aim to create spaces that bring real value to real people and promote better outcomes for happiness and wellbeing. It’s about bringing spaces to life and giving them meaning.

‘Access over ownership’

Renting used to be seen as a short-term solution to changing living circumstances, addressing a temporary gap before or in between buying a property. This short-term view of renting meant that less thought was given to placemaking and less efforts were put into making a rented property feel like a ‘home’.
Apartment buildings had a transient population of renters moving in and out, and people would spend all their time in their individual apartments. Decorating would seem pointless, and all money would be saved to buy a property in the future.

Today, Millennials and Gen-Z have moved towards an ‘access over ownership’ mentality, meaning they prioritise accessing a product, service or lifestyle instantly and temporarily, without needing to own it. This trend has fundamentally changed the way people live.

Renting enables people to achieve their desired lifestyle in a prime city centre location, access better employment opportunities with higher salaries, and enjoy leisure amenities both inside their home and on their doorstep.

Given that a third of millennials are now expected to rent their entire lives and the average age to buy a first property in the UK is at an all-time high of 33, the BTR market has transformed to accommodate a more flexible, resident-led offering. It was recently reported by CBRE that 57% of residents within the private rented sector are over the age of 35, reflecting a more financially comfortable demographic with a higher rental budget. 

The power of placemaking in BTR

Residences are no longer just somewhere to sleep, but somewhere to live, work and enjoy. Developers that understand this inextricable link between homes and emotion, deliver the highest quality long-term property investments.

What does placemaking look like in BTR developments?

  • Resident-centric design, architecture and management which prioritises community and lifestyle
  • Community integration through development of public realm – green areas, cafes, play areas, restaurants, independent shops
  • Inspiring co-working space that gives people the option to work collaboratively or alone
  • Independent food and drink partners that reflect the culture and essence of the development and the people they serve, supporting local economy
  • Encouraging resident feedback to shape ongoing strategy 
  • High demand amenities with a focus on health, happiness and wellbeing
  • Regular events from running clubs to craft workshops, bringing people together 
  • A pet-friendly culture and regular pet events
  • Flexibility of contracts and apartment decoration

At Select Property, we’ve seen first-hand over the last two decades that the key to a successful property investment is about putting the resident at the heart of their own living experience. This people-centric approach is more important than ever post-pandemic, as renters have higher expectations of their homes than ever before.

What does this mean for investors? Stronger returns, capital growth and fewer vacant periods.

Check out our brands, each centred around the needs and lifestyle of a target rental demographic.

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