US-backed company is offering a range of short-term residential services
Amber Rose
US-backed London & Henley is set to boost the fledgling UK corporate housing market.
The company, backed by Security Capital Global Realty, is launching the “apartments with services” concept. It will offer companies tenancy agreements for employees on extended stays, providing them with a range of comforts in their own flat, including maid and laundry services.
Ever since Regalian Properties hooked up with US-based Oakwood and investment firm Colony Capital in February, housebuilders such as Galliard Homes, London & Henley and Pemberstone are moving into the serviced apartments sector.
London & Henley founder Kerry Kearton-Gee said: “The serviced apartment involves the tenant, usually a business traveller, wanting a shorthold agreement. We will be offering the companies longer tenancy agreements to house their employees who may be working in the UK temporarily. The serviced apartment sector is an unexplored market in the UK. It’s very large in the US.”
London & Henley recently let property to Kleinwort Benson at Queens Gate Terrace, SW7. The developer is talking to other corporations about letting property for corporate housing.
The new concept will have an advantage over the traditional corporate housing sector because there will be no need to implement the 90-day rule that distinguishes between hotel use and rental use, ensuring private rentals must last at least 90 days.
According to Knight Frank’s Stephan Miles Brown, the sector is run by private firms, many of which disregard the rules.
“There are apartments that are run in contravention of planning rules but the councils are cracking down on those who avoid the 90-day rule.”
According to James Koe, European president of US-based BridgeStreet, which leases flats in London, there are only four established corporate companies that operate in the short-term market – BridgeStreet, Execustay, Oakwood and Homestead.
He adds that this untapped market could turn residential developers into commercial landlords, leasing out to companies like BridgeStreet for the corporate housing market.
“The developers are tapping into an under-invested market. It’s an opportunity and a way of disposing of property that housebuilders can’t sell.”
