An early night. That is how HUB managing director Damien Sharkey aimed to celebrate last week’s double planning consent win for the residential developer. In a matter of hours, the company was given the go-ahead for a co-living scheme on London’s Wood Lane with 209 homes and the 205-flat Beaverhall House build-to-rent project in Edinburgh.
They were two “milestone” consents, Sharkey says, marking HUB’s first co-living development and its first foray into the Scottish capital. And they made for an exhausting week.
“We normally have three or four planning committees in a year, so to have two in different countries in 16 hours is quite unusual,” Sharkey says.
The proper party will come later and won’t only involve the HUB team. “What is key for us is actually celebrating with the design team and our funding partners because it’s not just us who achieves these consents,” Sharkey says. “Many years of hard work have gone in from our design team and our funding partners on these projects. So the celebratory drinks and dinners are all being planned at the moment.”
Before BTR
Sharkey’s pride in the Wood Lane and Beaverhall House schemes is driven by more than it just being a bumper week for the company. He sees the projects as proof of the evolution of HUB over the decade since chief executive Robert Sloss founded the firm.
Sharkey joined the company in 2014, becoming its development director, before taking a short break and returning in 2019 as managing director. Today he is involved in all parts of its projects, including site acquisitions, funding, design and planning.
“These projects demonstrate how the business has evolved in the three and a half years since I returned as managing director,” he says of last week’s approvals. “We were one of the first movers in the build-to-rent space nine years ago. BTR didn’t exist, it was PRS [private rented sector] at the time. We call that first-generation build-to-rent. Second-generation build-to-rent is the schemes we are competing today, but we see third-generation build-to-rent as post-pandemic living.”
Getting HUB’s collective head around exactly what that term means has been a focus for Sharkey and colleagues.
“We ran a competition with over 70 architectural practices to understand post-pandemic housing and living,” says Sharkey, himself a trained architect. “How does what we do need to change to cater for future tenants’ needs? That research fed into both of these projects.”
Flexibility is at the heart of that new era for BTR, Sharkey says.
“The home is not just the place where people have breakfast, then go to work and come home to sleep,” he adds. “It’s now a place people homeschool in. They work from home. The balcony is no longer a 5 sq m balcony that people rarely use – the importance of private amenity is key. We have set ourselves the ambition of delivering housing that meets future needs. What we have is more flexible homes, more dual-aspect homes, more affordable homes and, in the case of Edinburgh, more homes that meet family needs. One of the changes we are seeing in the BTR sector is more families living in BTR properties in city centre locations.”
Unheard voices
The cost-of-living crisis adds another element to rethinking the offering.
“There is a responsibility to ensure we are building homes that are affordable to rent,” Sharkey says. “And that doesn’t just mean affordable with a capital ‘A’, it means affordable with a small ‘a’. With the cost-of-living crisis there is a responsibility for developers to seriously think about how we build these buildings.”
The Beaverhall House scheme will be operational net zero, while the homes in Wood Lane “can be heated from just the towel rail in your en suite”.
“Simple things like [building to] minimise energy bills, that is fundamental to people’s lives,” Sharkey adds. “That is the sort of thing we pride ourselves on as a developer because we are building homes where those energy bills should be minimal for people.”
To meet those needs, Sharkey and the HUB team argue that hearing directly from their end customers is non-negotiable and have made strides in ensuring they talk to members of the local communities in which they develop. For Sharkey, an advocate of engaging people in the planning process who haven’t been listened to, that engagement has been crucial to shaping schemes.
“We want to talk to those people who haven’t had a voice before,” he says.
“The first thing we did was send a team out on to the street to meet local people,” Sharkey says. “We do not expect people to come to us. So we had people on the tram, on the buses and on the street asking people about the part of the city we are developing – and not just our site, but the wider area.
“The things they like, the things they don’t, the frustrations and what they would want from any developer in terms of positive social impact. We then used that research to feed into our brief. We came up with a concept and took it back to the people.”
Locals appreciate honesty and transparency, Sharkey says.
“A scheme for up to 2,000 homes didn’t have one objection from local people or local businesses,” he says, adding that the plans were adjusted to ensure a “vibrant artist community” in the area was not disrupted.
“We promised them that we were not going to undo the reasons we went there in the first place, which was that amazing community,” he says. “We committed that we would provide 56,000 sq ft of affordable workspace that will be at 50% of market rent.”
Certainty and speed
Like many developers, HUB has seen the good and the bad in the UK’s planning system. The company has won 15 consents over 10 years and has worked with local authorities to compromise on schemes where necessary – Wood Lane was approved on its second appearance in front of Hammersmith & Fulham’s planning committee. Beaverhall House involved getting to grips with new planning policies in the city.
“We have worked with some amazing local authorities,” Sharkey says. “Some others we have had frustrations but we have always found a way forward.”
Developers want certainty and speed from the planning system, Sharkey says; a lack of either can scupper schemes. But he adds that developers themselves have to play their own part in making relationships with planning professionals work.
“It’s one of the responsibilities of developers to help local authorities,” he says. “It’s easy for us to point the finger and say local authorities don’t perform, they are under-resourced, they take too long. But, as a developer, we have a responsibility to help them, make their job easier, listen to them, respond to comments, respond to concerns, address issues and sometimes make changes – on the Wood Lane scheme we reduced the height of the scheme. We were committed to getting a consent to build that scheme and we worked with officers and the planning team to ultimately achieve a consent that they are proud of and we are very proud of.”
Delays have become part of the process for many developers – HUB once waited two years to get a scheme to committee – and Sharkey is aware of the pressure that creates on projects.
“When we have economic challenges, with rising construction costs, every month costs money,” he says. “Sometimes when you say to local planning authorities that time costs money, they laugh – but time genuinely does cost money. And quite often in schemes, if you were to shorten that one- or two-year period to get planning by half, you could potentially provide a lot more affordable housing.”
And costly delays can threaten the viability of smaller developers without the kind of relationship that HUB has developed, for example, with Bridges Fund Management. It has now teamed up with the firm on 10 deals with a combined GDV of more than £1bn, including the two latest schemes.
“The overall period of starting that journey to get a determination, regardless of the scale of the project, has a huge impact on the viability of the project and the good things we can and can’t do, particularly in the inflationary environment we are in at the moment,” Sharkey says. “We have an environmental crisis and we have ESG responsibilities. Piling that on top of delays in planning is just making things that little bit harder.”
Start of the journey
With Wood Lane and Beaverhall House in the bag, there’s no rest for the HUB team. The company has 1,383 homes in construction with a combined GDV of about £550m, Sharkey says. Another 3,384 are in the planning system with a £654m GDV. Plans for another Birmingham scheme, a 462-home BTR project in Snowhill, were lodged earlier this month. Sharkey hopes it could land in front of the city’s planning committee in March or April next year.
The economic downturn that looms over the country is too ominous to avoid but Sharkey is adamant that BTR will prove its resilience, just as he argues it did during the Covid-19 pandemic.
“BTR is at the beginning of a journey that is going to go on for a long time,” he adds. “The percentage of BTR homes in the UK is tiny compared with other countries in Europe and the United States. We genuinely believe BTR has a key role to play in the coming years. It has a place in the market and it will continue to have a presence during any sort of economic turbulence that’s to come.”
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