How partnerships can provide a quicker fix to London’s housing crisis

With London’s unrivalled position as the UK’s best city for rental investment, the opportunity for Grainger to work with Transport for London to develop eight sites and build more than 3,000 new homes across the city in a partnership proposed earlier this week is very compelling. Grainger’s model of well-connected rental homes targeted at the deep mid-market aligns perfectly with TfL’s long-term vision and aspirations to deliver good quality homes in well-connected locations, providing it with a stable income stream to reinvest in the transport network. Housing schemes in London can take a long time to deliver due to the fine grain and density of the urban environment, conflicting planning landscapes, costs and logistics of implementation. TfL’s investment into preparing sites for delivery and Grainger’s expertise in development delivery and operations means that we can accelerate the programme for new rental homes. In the case of this partnership, we have an ambitious but achievable plan of getting eight developments on site within two years, meaning our homes will be delivered at a much faster pace than a for sale development. The commitment to accelerated delivery is easier in the BTR environment, as we don’t require pre-sales. As an example, in the case of Argo Apartments in Canning Town, launched by Grainger in January 2018, this scheme of 134 homes was fully occupied in just four months. With leasing levels at an average of 33 homes per month, compared with the average sales of 4-8 homes per month, occupation was up to two years faster than it would have been on a for sale development. “Partnerships are a mutually beneficial way of growing the sector and providing for the increased demand for quality rental homes in London, and throughout the UK” The partnership approach offers so many benefits for a long-term landowner such as TfL – it converts a site into a long-term, stable revenue stream and delivers new homes. Grainger has a strong track record in this area of working with partners including the Ministry of Defence and the Royal Borough of Kensington and Chelsea. Our partners can also be prescriptive about the types of tenures they want to include. In this case TfL stipulated a minimum of 40% affordable homes. Grainger and TfL owning the developments for the long term gives greater certainty through the development process as we don’t have to consider the sales risk. Our partnership with TfL, and those on our other pipeline projects with Haringey, Lewisham, West Berkshire Council, Network Rail, the GLA, LPFA and LinkCity are always built on solid foundations – an aligned vision, shared values and a long-term commitment. Our business strategy is focused on long-term revenue streams, which differentiates us from some of our competitors who access equity through time-limited vehicles or third party funds. Grainger’s business model is still unusual within the sector in that we manage the entire process in-house, from investment to design and build, to owning and operating. We have a proven track record in delivering large-scale projects and our customer-focused approach puts service at the forefront. For Grainger, and our counterparts in the BTR sector, partnerships are a mutually beneficial way of growing the sector and providing for the increased demand for quality rental homes in London and throughout the UK. For potential partners, working with a business like ours provides expertise, speed to market and long-term reliable finance. An investment in a strong supply of high quality, well connected, rental homes that are aligned to wages can only be a positive thing for TfL, Grainger and London. Helen Gordon is chief executive of Grainger