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One size does not fit all – the modern face of UK build to rent



One size does not fit all - the modern face of UK build to rent

Build to Rent, while still in it’s infancy, is now learning to walk. The realisation that the concept of a ‘typical’ renter is becoming a thing of the past. The modern residential market must serve a range of customer’s needs if it is to keep up with demand.

Stephanie Smith

Stephanie Smith

Atlas Residential’s Operations Director, Stephanie Smith, considers the changing shape of the market and what the implications are for the design and service delivery of build to rent developments.

When we talk about rented accommodation, too often the image that springs to mind is of young, single tenants sharing a flat, living close to work as they try to start climbing the career ladder. However, that stereotype which the UK subscribed to for the past 7+ years as Build to Rent came to fruition is becoming increasingly outdated, meaning that the way we design and deliver rental developments needs to change.

As I reflect on my tenure in the US multifamily market, I am a firm believer that this is a community for everyone, from a new graduate, indeed, to a retiree who has decided they don’t want the hassle of a mortgage or home repairs and prefer a social community setting. While others chat about sharers and millennials, we need to recognise the value of catering to those renters who look for long term places they can call home.

The latest English Housing Survey, for example, confirmed that more than 1.5 million people aged 65 and above now live in rented accommodation. The jump in those renting privately over the past decade is significant. In 2007, 254,000 older people rented privately. That figure has now risen to 414,000 and some estimates suggest that a full third of those aged 60+ could be renting privately by 2040. That gives us little over a decade to dramatically alter the way we perceive and design build to rent services in the UK.

The Centre for Ageing Better reports that private landlords have the highest proportion of poor quality housing of any tenure type, along with higher levels of disrepair. Poor quality accommodation is unsuitable for any resident, but particularly so for potentially vulnerable groups such as older renters. The difference that the build to rent sector can make is therefore significant.

Tenancy length plays a role here too. Short-term tenancies are hardly likely to encourage older residents to agree home adaptations with their landlords, yet often a few simple adaptations such as handrails or ramps can enable older people to remain independent in their homes for many years. The Centre for Ageing Better reports that 16% of those aged 65 struggle with at least one daily living activity (such as washing or dressing), compared with around half of those aged 85. If a third of people over 60 could be renting by 2040, we need to ensure that their properties and their tenancy types enable them to maintain independence and dignity within their own homes.

However, it is vital to dispel the stereotype that mature renting does not always mean a senior community with healthcare services. Even within the mature renter group, we need to consider the different needs. Many simply want a safe community where they can engage with neighbours, have excellent service when repairs are needed, and a quiet place to hang their hats. This type of living also means they can travel without the strings that home ownership brings.

Mature residents are just one example. However, build to rent also needs to serve increasing numbers of families, renters with pets, and those residents who work from home and so forth. The Office for National Statistics reports that 15% of all people in work in the UK are now freelancing, undertaking contract work or self-employed. Online jobs platform PeoplePerHour has even gone so far as to suggest that 50% of the UK workforce will be freelancing by 2020. Even if that shift doesn’t occur quite so fast, it’s certainly the direction in which we are headed. Ultra-fast broadband and WiFi, then, are core services in new build to rent homes, not just for those watching Netflix but for residents who make a living from home.


The nature of shared facilities should be considered as part of this shift to a new customer base for rental accommodation. Quiet, professional workspaces where tenants can hot desk with their laptops, or bring a business contact in for a meeting will suit those who freelance or work from home. On-site cafés are ideal for older residents looking to socialise. Crèche services, “Parents Day Out” events, and proximity playgrounds and good schools meet the needs of those with children. Modern developments need to think all of this through and incorporate flexibility and variety into their design and service delivery if the UK is to truly service the needs of all renters. However, the disappointing truth is that many developers or those who are making decisions have not rented in years, so forget to look at the potential through their customers’ eyes.

We need to shift our definition of a typical build to rent home. One and two bedroom apartments are great for many renters, but there’s also a sorely overlooked need for low-rise, quality family apartments and homes that can be rented long-term. One only needs to look at what works elsewhere in order to deliver the perfect blend of accommodation.

In most countries, throughout North America and Europe, for example, you would be hard pressed to find a market where families were not recognised and considered an integral part of the community. The UK market is tragically inundated with one and two bedroom units, however, the few three bedrooms aren’t considered on a reasonable level, both in proportional availability nor in affordability. Three and four bedroom rents are, essentially, priced by taking an average income and multiplying it by 3 or 4 incomes- a bit audacious really since I am not aware of many children making £27K a year. By pricing in this manner, the market is ostracising a demographic which has been proven to be longer term, more reliable, and often the most loyal type of customer. Once a family is located in a good home in a safe, happy neighbourhood and their children are settled in school, the likelihood of moving diminishes far more than a nomad-like millennial who will go to the next shiny community when it opens!

Atlas Residential and Rockspring Property Investment Managers LLP's complete and operational site,   Bow Square, Southampton 

Atlas Residential and Rockspring Property Investment Managers LLP’s complete and operational site,  
Bow Square, Southampton

By putting ourselves in our customers’ shoes, and taking a fresh, contemporary approach, build to rent owners and operators such as Atlas Residential can meet the needs of all those who rent in the UK. This is imperative if we are to prove that renting is not a stigma, but a beneficial and flexible way of life.

Whether people rent by choice or as a result of an inability to afford to purchase property, they deserve to have high quality accommodation that meets their individual needs. The UK is already behind the curve in terms of adapting its service design in this respect – the rental market has already changed significantly and we have much to do to catch up and provide the homes that the country needs. Only through substantial effort will we ensure that all renters’ needs are met. Thankfully, the build to rent sector is well positioned to do this – we just need to continue striving to innovate and to design our services around future needs, as well as current ones.

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Leon Black step downs as Apollo CEO after review of Epstein ties



Leon Black step downs as Apollo CEO after review of Epstein ties 1

By Mike Spector and Chibuike Oguh

NEW YORK (Reuters) – Leon Black said on Monday he would step down as chief executive at Apollo Global Management Inc, following an independent review of his ties to the late financier and convicted sex offender Jeffrey Epstein.

While Black, whose net worth is pegged by Forbes at $8.2 billion, will remain Apollo’s chairman, his decision to step down illustrates how doing business with Epstein weighed on the reputation of one of Wall Street’s most prominent investment firms. Black co-founded Apollo 31 years ago.

Apollo said it plans to change its corporate governance structure, doing away with shares with special voting rights that currently give Black and other co-founders effective control of the firm.

The independent review, conducted by law firm Dechert LLP, found Black was not involved in any way with Epstein’s criminal activities. Black paid Epstein $158 million for advice on tax and estate planning and related services between 2012 and 2017, according to the review.

Black, 69, said that although the review confirmed he did not engage in any wrongdoing, he “deeply” regretted his involvement with Epstein.

“I hope that the results of the review, and related enhancements … will reaffirm to you that Apollo is dedicated to the highest levels of transparency and governance,” Black wrote in a note to Apollo fund investors. He will step down as CEO no later than July 31.

Apollo co-founder Marc Rowan, 58, will take over as CEO.

Rowan has often kept a low-key profile compared with Apollo’s other co-founder, Joshua Harris, 56, and spearheaded many initiatives that turned Apollo into a credit investment giant, including the permanent capital base the firm enjoys through its ties to reinsurer Athene Holding Ltd.

The revelations of Black’s ties to Epstein took a toll on Apollo, which Black turned into one of the world’s largest private equity groups. Apollo executives had warned in October that some investors had paused their commitments to the buyout firm’s funds as they awaited the review’s findings.

Apollo shares are down 1% since the New York Times reported on Oct. 12 that Black paid at least $50 million to Epstein for advice and services, when most of his clients had deserted him.

Over the same period, shares of peers Blackstone Group Inc, KKR & Co Inc and Carlyle Group Inc are up 19%, 10% and 23%, respectively.

“We think a large number of (Apollo fund investors) took a ‘pause’, and we believe the outcome (of the review) and changes today will cause most of them to return to allocating to future Apollo funds,” Credit Suisse analysts wrote in a research note.

Apollo shares jumped 4% to $47.65 in after-hours trading on Monday.

“We continue to follow these events closely and will evaluate how Apollo addresses its issues,” the California State Teachers’ Retirement System, one of the largest U.S. public pension funds and an Apollo investor, said in a statement.

Epstein was found dead at age 66 in August 2019 in a Manhattan jail, while awaiting trial on sex trafficking charges for allegedly abusing dozens of underage girls in Manhattan and Florida from 2002 to 2005. New York City’s chief medical examiner ruled that the cause of death was suicide by hanging.


Black previously said he had paid millions of dollars to Epstein, but the exact size of his payments was revealed for the first time on Monday. Beyond the $158 million in payments, Black made two loans to Epstein totaling $30.5 million in early 2017.

Dechert said in its report that Black’s social ties with Epstein, who built his fortune by endearing himself to powerful figures in high society, went back to the mid-1990s.

Epstein won Black’s trust by resolving an estate tax issue for him in 2012 potentially worth at least $500 million, the report said. He ended up advising Black on various aspects of his personal financial affairs, from his family office and airplane to his yacht and artwork.

Black believed that Epstein provided advice over the years that conferred between $1 billion and $2 billion in value to him, according to the Dechert report. Black said in his note to investors that he had paid Epstein a fee equivalent to 5% of the value he generated on an after-tax basis, and not tied to hourly rates.

Black and Epstein’s relationship deteriorated after Epstein failed to repay $20 million of the loans and Black refused to pay tens of millions of dollars in fees that Epstein demanded, according to the Dechert report.

They severed ties in October 2018, according to the report. Black knew Epstein had been convicted in Florida a decade earlier for soliciting prostitution from a minor, the Dechert report said, but there was no evidence suggesting Black had knowledge of the other alleged crimes before they were publicly reported in late 2018, culminating in Epstein’s July 2019 arrest.

On Monday, Black pledged $200 million toward “initiatives that seek to achieve gender equality and protect and empower women,” as well as helping survivors of domestic violence, sexual assault and human trafficking.

Apollo said it would pursue a “one share, one vote” corporate governance structure that would do away with shares with special voting rights. It said the move could qualify it for listing on the S&P Global indices.

Apollo also said it would seek to give its board more authority to oversee its business, eroding the power of its executive committee led by Black.

The board will be expanded to include four new independent directors, including Avid Partners founder Pamela Joyner and physician and scientist Siddhartha Mukherjee, Apollo said. Apollo co-Presidents Scott Kleinman and James Zelter will join the board and take on increased responsibility running day-to-day operations.

Apollo had about $433 billion in assets under management as of the end of September.

(Reporting by Mike Spector and Chibuike Oguh; Additional reporting by Lawrence Delevigne and Jessica DiNapoli in New York; Editing by Sonya Hepinstall, Leslie Adler and Kim Coghill)

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EU sees no cliff-edge ending for COVID fiscal stimulus



EU sees no cliff-edge ending for COVID fiscal stimulus 2

BRUSSELS (Reuters) – European governments will not need to abruptly end fiscal support for their economies after the pandemic, top officials said on Monday, noting that any withdrawal of stimulus would be carried out gradually and only once the economy has recovered.

Euro zone public debt rose sharply during 2020 and is likely to exceed 100% of GDP this year as governments borrow to help individuals and businesses survive lockdowns.

The higher debt raises concern about how to deal with it down the road and when to start cutting it again, since the EU last year suspended its rules limiting budget deficits and debt, known as the Stability and Growth Pact (SGP).

EU finance ministers are to discuss when to reintroduce any borrowing limits in the second quarter of this year.

“I believe it important that finance ministers debate and reach a common understanding on the appropriate fiscal stance by the summer. This can then serve as guidance for the preparation of their draft budgetary plans for 2022,” the chairman of the euro zone’s group of finance ministers, Paschal Donohoe, said on Monday.

“To avoid any misunderstanding, let me stress that this is not about an imminent withdrawal of fiscal stimulus,” he told the economic committee of the European Parliament.

“We all agree that our immediate priority is to shield our citizens, in particular younger cohorts and those most exposed to the crisis. There must be no cliff-edges,” he said.

Joao Leao, the finance minister of Portugal which holds the rotating presidency of the EU and therefore sets the agenda for EU finance ministers’ work until June, was equally cautious.

“We should not withdraw stimulus too early. We need to make sure the suspension clause for the SGP remains in force at least until we return to pre-crisis economic figures,” he told the committee. “We need to make sure jobs are maintained as well as the production capacity of companies.”

He said first cash from the EU’s 750 billion euro post-COVID economic recovery programme should reach the economy in the first half of the year.

“Real funding should be getting to the economy before the summer or in early part of the summer,” he said.

(Reporting by Jan Strupczewski; Editing by Giles Elgood)

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IMF to intensify focus on climate change’s economic impact, Georgieva



IMF to intensify focus on climate change's economic impact, Georgieva 3

By Andrea Shalal

WASHINGTON (Reuters) – The International Monetary Fund views climate change as a fundamental risk to economic and financial stability, its chief said on Monday, mapping out the IMF’s plans to help focus investments in green technologies that will boost global growth.

IMF Managing Director Kristalina Georgieva told the Climate Adaptation Summit that global economic output could expand by an average 0.7% annually over the next 15 years and millions of jobs could be created if carbon prices rose steadily and investments expanded in green infrastructure.

“We see climate as a fundamental risk for economic and financial stability, and we see climate action as an opportunity to reinvigorate growth, especially after the pandemic, and to generate new green jobs,” Georgieva said.

She said the IMF was taking action in four areas to accelerate the transition to a new low-carbon and climate-resilient economy.

Georgieva said the Fund would launch a new “Climate Change Dashboard” this year to track the economic impact of climate risks and the measures taken to mitigate them, a key step to ensuring the needed shift.

“Climate resilience is a critical priority,” she said. “This is why we place it at the heart of what do, this year and (in) the years to come.”

The Fund is also integrating climate factors into its annual economic country assessments, also known as Article IV consultations, focusing on adaptation in highly vulnerable countries, and carbon pricing in its assessment of large emitters, Georgieva said.

In addition, she said the IMF is adopting enhanced stress tests and standardizing disclosure of climate-related financial stability risks in its financial-sector surveys, and expanding its training and support to help central banks and finance ministries take climate considerations into account.

The World Bank, the largest multilateral funder of climate finance, boosted funding for adaptation projects to 50% of its total climate finance over the past four years, and plans to maintain that percentage for the next five years, World Bank President David Malpass told the same event on Monday.

In addition to funding projects addressing coastal erosion, increasing crop yields and building cyclone-resistant infrastructure, the Bank was also investing in early warning and evacuation systems, better social protection, and weather observation, he said.

(Reporting by Andrea Shalal; Editing by Paul Simao)

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