Plan­ning reg­u­la­tions may hin­der growth of build-to-rent sec­tor

Irish Independent - Business Week - - APPOINTMENTS - Ron­ald Quin­lan

The grow­ing po­ten­tial of Ire­land’s build-to-rent (BTR) sec­tor is fac­ing a num­ber of pos­si­ble ob­sta­cles ac­cord­ing to a new re­port by in­ter­na­tional con­struc­tion con­sul­tancy, Li­ne­sight.

Draw­ing on data from its sec­toral knowl­edge and di­rect ex­pe­ri­ence of con­sult­ing on

7,000 BTR units in Dublin and the Greater Dublin Area, the com­pany’s re­search de­liv­ers a num­ber of in­ter­est­ing find­ings.

Ar­guably the most notable of these is the re­luc­tance of de­vel­op­ers to des­ig­nate new schemes as build-to-rent un­der the plan­ning guide­lines, due to the re­stric­tive re­quire­ment for such de­vel­op­ments to be held for at least 15 years be­fore be­ing sold.

Also noteworthy is the re­port’s find­ing that while build-to-rent units can be de­liv­ered at a sim­i­lar cost to those be­ing con­structed for the build-to-sell (BTS) mar­ket, of­fer­ing flex­i­bil­ity for fu­ture con­ver­sion from BTR to BTS is com­ing with a pre­mium cost.

Li­ne­sight’s man­ag­ing di­rec­tor, Richard Joyce, says: “Our re­search in­di­cates that there is a fun­da­men­tal de­sire to build this as­set class in Ire­land at scale, with pen­sion and in­sur­ance funds con­sti­tut­ing the largest na­tional and in­ter­na­tional in­vestors in the sec­tor. BTR is seen to be a rel­a­tively sta­ble and sus­tain­able in­vest­ment area, and while rents will ad­just as sup­ply in­creases in the com­ing years, there will sim­ply be ad­di­tional em­pha­sis on fac­tors that are al­ready key ar­eas of fo­cus, such as prod­uct qual­ity, lo­ca­tion and ameni­ties.”

While 29pc of the Ir­ish pop­u­la­tion is now rent­ing, that per­cent­age is set to grow owing to the na­tion’s age pro­file. Of the cur­rent pop­u­la­tion 29.5pc falls within the 25-44 age bracket

– the tar­get mar­ket for rental ac­com­mo­da­tion.

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