Global Real Estate Experts: Greystar Expands Rental Housing Across Europe
Five years after arriving in Europe, global rental housing leader Greystar – the largest operator of apartments in the US – is looking to position itself as the “leading provider and operator of rental housing in all major European cities”.
Globally, Greystar manages some US$115bn of real estate. In Europe, it has already built up over US$6.8bn under management, with more than 51,100 residential units/student beds spread across nine European cities.
Steven Zeeman, Senior Managing Director, Continental Europe, told Global Real Estate Experts: “We are currently actively looking for new locations, new opportunities and new partners for purpose-built rental housing across all he large cities in Europe.”
[Greystar is] currently actively looking for new locations, new opportunities and new partners across Europe.
Build-to-rent housing is a growing sector across Europe. It is about creating ‘communities’, whether in a single block or several buildings, owned and managed by a single corporate landlord, and with on-site leasing, management, security and maintenance teams.
Starting in London, then opening across Continental Europe
Greystar started out in Europe with student housing, following the purchase of a 7,100-bed student portfolio in the UK from distressed owner Opal in 2013. The company now operates ten Chapter student housing locations in zone 1 and 2 of Central London, in partnership with PSP and Allianz.
The company, with global headquarters in Charleston, proceeded to build up a high-quality rental portfolio by investing in purpose-built rental housing in the UK, and last year closed on a deal to deliver a 550-apartment development, in Croydon, South London, in what will be the world’s tallest modular towers.
In the Netherlands, Greystar has been present since 2015, when it acquired the 941-apartment complex OurCampus Amsterdam Diemen. Then in 2017, it purchased Spain’s largest student housing provider, Resa, in a joint venture with AXA IM – Real Assets and CBRE Global Investment Partners.
Since then, Greystar has branched out to appeal to residents ranging from young professionals to corporate occupiers, with new projects across London, including Greenford Quay in West London, Sailmakers in Canary Wharf, Nine Elms in the former Royal Mail Centre in Battersea and, its latest project, two residential towers in Croydon.
In Continental Europe, Greystar purchased DC Tower III in Vienna at the end of last year as a joint venture with Swiss-based Partners Group. On completion, the tower will have a total floor area of 20,000 sq m and offer apartments for corporate housing, short stays, young professionals and students. Certain ‘lifestyles’ will be allocated to different floors, while the communal facilities will range from gyms to co-working facilities and a rooftop events space.
Greystar’s newest European market is Paris, where the company opened an office last year. Here, Greystar is working on a pipeline to echo its Chapter student housing in London, as well as opening up the accommodation to young professionals.
Global Real Estate Experts talked with Steven Zeeman, Senior Managing Director, Continental Europe, and Mark Allnutt, Senior Managing Director, UK and Ireland.
What is your aim for Europe?
Steven Zeeman: To bring the next generation of rental housing to the market. Europe is attractive given the number of large metropolitan areas with a highly educated, mobile, young population, and a high proportion of single households.
Are you a market disruptor?
"What we are doing is providing a much better product for people to rent."
Mark Allnutt: Our model is tried, tested and institutionalised in the US. We are not ‘creating’ renters. What we are doing is providing a much better product for people to rent. We do this by creating well thought out, purpose-built buildings with high-quality design and specifications, fantastic communal facilities and a world-class service – places where people can live hassle-free in a community of like-minded people.
Why are communal facilities so important?
SV: Many of our residents are highly mobile, moving from one city to another. How do they meet new people? By offering shared amenities, whether a bar, an events space, a gym, we can create a community where people feel at home rather than being alone between their four walls.
“Greystar creates and curates places, communities”
Do you adapt the Greystar model for Europe?
MA: Greystar creates and curates places, communities. This model is readily available in the US, but it is relatively new here in Europe. In terms of the Greystar USPs of great amenities and a world-class customer service, very little of the US model gets lost in translation.
What size of project do you look for?
MA: There are huge benefits for delivering this product at scale. First, it is easier to access the land market, as there is less competition for sites. Also, once you get to a certain scale, you can keep on adding units without adding many more staff.
Scale also creates more of a community. If we look at our Greenford Quay project [in West London], the 8-hectare site had planning consent for 593 apartments when we bought it in 2016; we subsequently gained planning consent for 2,000 apartments. We can deliver this housing, and ‘stabilise’ the project, much faster than a for-sale house builder as we are building to create income, instead of matching sales rates.
Greenford Quay will have a primary school, healthcare centre, public square, retail, food and beverage, and a pedestrian bridge over the canal, as well as opening up previously closed road access through the site to allow for public transport.
SZ: Greenford inspired us to have two kinds of projects in the Netherlands, where we have close to 5,000 homes in Amsterdam, Rotterdam and Utrecht: the inner-city project, which is more of a residential tower, with a small footprint, and then for our projects a little outside the city centre, a development where you almost build a small village in itself.
“It’s about how you set up a community where people want to live for the long term”
How are you innovating your operations and services?
MA: Well, first of all, in Croydon, we will be building the world’s tallest modular tower, with 44 floors. We use modular building wherever we can, as this reduces building times by half.
SZ: When it comes to design, especially in Continental Europe, we are diversifying the unit mix, to provide studios, duplexes and regular-sized apartments. This is important for affordability and to match tenant demand.
We are also reducing the number of garages, as very often these are not used given that all our projects are near public transport. Currently, we are looking at a sharing concept for electric cars and bikes. And a key focus has been to improve the online leasing experience.
With regards to sustainability, we already have projects that go beyond the requirements and the building codes. For us sustainability is not just about energy consumption and waste management, it’s also about how you set up a community where people want to live for the long term. It’s about the social aspect of occupying real estate.