Specialist property developer and operator Strawberry Star Group continues to expand its housing vision with the launch of a dedicated Built-to-Rent (BTR) arm, Star Living. Star Living is positioned in the market to provide a modern and convenient rental product within the commuter belt against a background of chronic supply issues, whilst serving investors as a resilient asset class poised for growth.
Star Living will launch at its Harlow development in Essex, with phase one as a dedicated BTR block of 163 residential units with a GDV of £45m, due to start construction this year. Planning permission has also been granted for a Star Living site in Gravesend, Kent, with a first phase planned of around 100 BTR units with a GDV of £30m. An existing BTS site of Strawberry Star, Lu2on in Bedfordshire, will soon launch phase two with 564 units under BTR with an estimated GDV of £160m. Strawberry Star Group aim to have a portfolio within London commuter towns with a target of £1 billion GDV by 2027.
“Our vision for Strawberry Star’s Star Living arm is to be the leading income generating, diversified and scalable BTR investment platform through our unique, cost-efficient, build and operational expertise. We aim to be one of the largest BTR providers in the commuter belt by 2027. Star Living brings together our existing skillsets as an end-to-end provider combined with a panel of leading contractors and consultants for significant placemaking schemes that benefit each local community,” said Chairman of Strawberry Star, Santhosh Gowda.
“With a strong pipeline of new Star Living sites due to launch in the next 12 months, we are one of the few developers responding in volume to the current supply crisis. We are focusing on commuter growth towns with a high proportion of young professionals and a low supply of rental properties, aiming to help redress the balance which is causing an upwards pressure on rental values. More choice and better supply will be a huge advantage to those now spending increasing time at home with flexible working here to stay, as BTR products are in a much better position to meet future needs and live-work trends,” continued Santhosh.
Adding a dedicated BTR offering on top of development, residential sales, lettings, asset management and acquisitions, Star Living positions the business as a unique end-to-end provider for an integrated solution, providing one customer journey for both investor and tenant. Handling everything from letting the property to community engagement, Star Living’s purpose-built model is a one-stop-shop designed to secure peace of mind on both sides.
The business has already tested out market appetite at their flagship Lu2on scheme in Bedfordshire, having recently completed on its first phase of 401 units, with one of the three finished blocks dedicated to BTL rental homes only. 65% of the 135 rental units have already rented within the last 3 months of completion. Luton represents a key growing commuter hub for Strawberry Star, indicative of the future sites Star Living will target.
For tenants, the first Star Living site in Harlow will provide a single customer journey from reservations to end of tenancy, including digital concierge, maintenance, parcel storage, flexible co-working and multi-purpose room, shared roof terrace, ancillary services such as laundry, dry cleaning, and housekeeping, with pets allowed and flexible contracts on offer. Studios as well as one and two-bedroom apartments are expected to be available to rent with Wi-Fi and furniture included. Star Living Harlow is due to complete in 2024 and will eventually provide over 163 new homes.
Other Star Living sites aim to fill a gap in the market by virtue of its chosen location. By choosing areas close to transport hubs that have very few new-build rentals on offer, Strawberry Star aim to be the first to market, providing invaluable new homes for growing commuter hubs. Nearly all BTR schemes under Star Living will be located in towns and cities identified as having increased housing targets, underlining the important role these homes have in meeting the UK’s national housing targets.
A combination of robust demand for housing from the local population, new household formations, fewer private landlords and low levels of housing completions, has led to a structurally low level of rental vacancy. Recent analysis from Capital Economics concluded that the UK would need 230,000 new rental homes a year if the current trajectory of tenant demand continues. BTR could serve a vital role in boosting supply, remaining the fastest-growing part of the rental sector since 2016.