In Review: UKAA NW Hub event – ESG in BTR
On 15th February, the UKAA’s NW Hub met for their first event of 2023. The in-person event held in Manchester and sponsored by Sigma Capital, examined ESG in BTR.
With ESG literacy one of the key aims of the UKAA, as per the 2023 Manifesto, the topic of this well-attended and lively member-only event was most pertinent.
The event began with a welcome from Dougie Orton Wade of Native Residential and UKAA NW Chair followed by Duncan Sutherland of Sigma & Homes for England who provided an introductory keynote with an overview on market trends and what 2023 has in store for Build to Rent.
The carefully curated expert panel comprising Lesley Treacy, Head of ESG for Dandara, Elizabeth Jackson, Marketing Director of Loft, Lucinda Lay, Biodiversity Net Gain Lead for CBRE, Brendan Geraghty, CEO of the UKAA and Niamh Waldron ESG Director for Sigma Capital as Chair, explored the challenges, how the BTR sector is responding and what the future holds.
The event concluded with networking drinks and informal discussion.
Below is a summary of the discussion and key findings:
Homes England support for ESG and BTR
Homes England is launching a new programme to promote and support the development of communities and place, working with local communities to identify local needs, with local partners.
This programme will have Homes England-funded workstreams where projects must demonstrate environmental and social impact, that the design will enable communities to thrive and provide significant contribution towards net zero carbon.
Homes England sees BTR as a key partner in delivering this programme over the next 10 – 15 years and see the need to increase focus to supporting the development of rental homes, working with housing delivery partners who are seeing significant increase in the amount of rental.
ESG as central to organisation’s culture
British Business Bank defines ESG as “a business’s collective impact on environment and society, and the strength of its governance in delivering this”.
ESG must be central to an organisation’s culture – through employees and the whole supply chain.
All elements of ESG must be synchronised, and central to a design and development brief from the outset. Minimising carbon footprints and running costs are essential, and developers must also be designing for the lowest possible level of embodied carbon.
Environmental performance
Certifications of environmental and sustainability performance of a development give investors and funders confidence. 87% of investors seek environmental certification on the buildings they invest in, to prove green credentials. Buildings with strong environmental stories tend to lease quicker and attract higher rents.
Meeting community need
Development must take into account what the community wants and needs – now and in the future. Community engagement is seen as one of the pre-requisites of ESG in BTR – to deliver the right homes that society needs, in the right places. This includes the wider public realm, designing in the right green spaces and facilities to promote well-being.
Social impact
Community need is central to effective social impact too. Through engaging local charities, local authorities and residents, investors and developers can identify the key issues to an area, and identify partners with whom to deliver social impact. This can be through education, skills and training which increase employability and social mobility. Alternatively, social value is delivered through BTR operation staff donating time to volunteer with local causes. Or support of charities providing food to the homeless.
The key message from the panel was to be properly engaged with what the community needs, and this goes beyond simple financial contribution.
Conclusions
The biggest ESG impact that BTR can make is to provide much needed, good quality homes. A home probably provides more stability and value to a person than anything else.
Consultation with communities and stakeholders, both deeper and wider, is key to long term success in development. We are getting better at this but there is still lots of room for improvement.
Everyone has a responsibility to do something.
To share your views on ESG within BTR, get in touch today or attend a future NW Hub event, please visit our Upcoming Events page.