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Residential Friday 29th April 2016

Housebuilders who do it differently

Housebuilders who do it differently

The housebuilding sector has sometimes been accused of wanting to do nothing more innovative than just putting ‘one brick on top of another’. However, as Nick Whitten, Associate Director at JLL reports, there are those out there who are really doing it differently.

A HOUSE IS A MACHINE

Today, it’s vital that those machines evolve through innovation to suit the needs and desires of a growing population. The UK housing industry is a world leader in terms of innovation. Scores of companies are challenging the norm and pushing the boundaries of creativity and invention every day.

To give a sense of the innovation that’s taking place, I’ve picked three examples from the housebuilding business and the first focuses on our ageing UK population.

Since 1980, the number of people aged over 65 in Britain has remained relatively constant, accounting for a steady 15% of the national total. But during the next 25 years, this number is forecast to rise dramatically from 11.4m to 18.1m – making up a quarter of the country’s population by 2040.

Additionally, one of the largest health and social challenges facing our country is an epidemic of loneliness amongst our elderly population which is typically born out of housing circumstance.

Surprisingly, however, there are precious few options for people as they get older. These options have been restricted by a lack of ambition, innovation, commitment and thought on the challenges and opportunities of ageing.

Without a radical shift in our approach around retirement housing, one in four people in Britain face the prospect of living in properties that are hard to maintain, potentially inaccessible, and which exacerbate loneliness. The property industry has been slow to adapt to this seismic demographic shift in the UK – until now.

Step forward PegasusLife a pioneering business on a mission to fundamentally rethink and reinvent the places and ways in which we live as we get older, driven by the current chronic lack of relevant and motivating options.

The business was established in 2013 with financial backing from Oaktree Capital Management. It is working with the country’s leading architects, designers and creative thinkers to form distinctive environments that help
people to get what they want out of life, promoting healthy living and a strong sense of wellbeing.

In each location, owners also become shareholders of the property management company, guaranteeing a say in how the development is managed. The developments provide intuitive services and experiences, with
some including hydrotherapy pools, spa and treatment rooms, as well as restaurants, bars and farm shops to
help everyone enjoy a rich life, the way they want it.

PegasusLife currently has more than 35 projects across Britain and Ireland at different stages of development, with more sites planned each month.

The next innovatory approach to the business of providing homes addresses the needs of those who are usually at the opposite end of the lifetime arc: first-time buyers.

In what has become a supply-starved London housing market effected by rapidly-rising prices, Pocket has built their model around the one facet that first-time buyers are not willing to compromise on – location.

The London-based developer prioritises location over size allowing it to deliver first-time buyer homes in good commuting locations at a minimum of 20% below the open market rate capped at the current top price of £260,000.

Pocket’s team is constantly looking for ways to push the boundaries on design. A range of clever features allow it to build homes at the Greater London Authority’s minimum size threshold of 409 sq ft that are both desirable and affordable.

The business has been innovative in its design, approach to planning and marketing for nearly 10 years now and has been accepted as the minimum size model in many London boroughs. The next 12 months will see Pocket move from being a niche developer to an innovative starter home builder. Around 30 Pocket homes have been delivered per year until now, but more homes are set to be delivered in the next 12 to 18 months than
have been created in the business’s entire history.

The simple step of identifying that first-time buyers in London will prioritise location over size has facilitated that growth.

Our research has revealed that, by following the Pocket model, the number of capable first-time buyers in London with a deposit of up to 20% increases by 145,000 to more than 327,000. This is nearly double the current 182,000 of the capital’s workforce who are capable of buying the average first-time buyer home in
London. It’s a model that is proving the maxim that small is beautiful.

Perhaps the most contentious area of the housebuilding process has been the materials used. The 18th century ushered in the age of the brick. The 19th century witnessed the era of steel and the 20th century spawned a concrete revolution.

But the 21st century has seen the return of one of the world’s oldest building materials. We are now living in a timber age and it has serious and far-reaching implications for sustainable construction. Consumers are facing rising fuel bills adding pressure on UK households. Innovative building techniques are becoming increasingly important in minimising these pressures and reducing energy costs.

One such innovation is cross-laminated timber (CLT), a sustainable wood alternative to traditional building materials. CLT is made up of layers of wood boards glued together perpendicularly under mechanical pressure. Between three and seven boards are typically used depending on the structure.

CLT has excellent cost benefits for consumers due to its thermal qualities, reducing the amount of energy needed to heat buildings by around 40%, lowering costs for consumers and reducing CO2 emissions.

It is manufactured off-site which helps to minimise construction site noise and air pollution, and – compared with reinforced concrete – it reduces the number of deliveries to a site by a factor of around seven. Construction timescales are reduced, typically by 25-50%, generating programme savings of around 33%, making it of particular interest to institutional investors.

Lendlease is a leading deliverer of sustainable urban regeneration and is continually exploring the latest innovations in sustainable building, including the use of CLT. It is already being used in the early phases of Lendlease’s 3,000-home Elephant Park project at Elephant & Castle. More than 200 CLT homes have also been developed in Battersea.

Lendlease is drawing on its global expertise in bringing large-scale CLT construction to the UK. In 2012, the developer completed the construction of Forté in Australia. The 10-storey 23-unit development is situated at
Victoria Harbour, Melbourne. It took a team of five labourers just ten weeks to construct what was the world’s tallest CLT apartment building at the time.

So whether it’s creating homes that fit a time of life or making them out of materials that are more in step with environmental needs, there’s clear evidence that the housebuilding sector is moving forward.