The Future of Multifamily - Beyond The Stay Podcast

Guest experts

• Colleen Pentland Lally - Vice President at CBRE, Colleen specialises in multifamily property sales in the USA. Participated in over $2.5 billion in multifamily acquisitions, development and JV equity transactions.
• David Montague - Former Chief Executive at L&Q, David is credited with turning the association into a major force with the business managing over 110,000 homes. David has also joined Staykeepers as a Non Executive advisor bringing his strategic mindset and wealth of experience in the industry.
• Dominic Grace - has spent 37 year career at Savills, building a market leading London team specializing in residential development and investment.

In this episode, we dive into:

1. How has the housing and multifamily sectors coped during the pandemic

2. Where are the hot spots in the industry

3. Investor sentiment about the current market situation

4. Need for flexible stays in the residential real estate market

5. Future predictions for UK and US markets

6. The role technology will play in the future of real estate

About the Beyond the Stay Podcast

We explore all things build to rent, student accommodation and the private rental sector. From overcoming challenges, to bettering the industry and future predictions with leading guest experts.

Full Transcript

[00:00:00] Charlotte Russell: Hello, and welcome. Today, we are talking about the future of multi-family, build to rent, private rental and I'm joined by some amazing guests.

[00:00:34] Charlotte Russell: So let's start with you Colleen. Please could you introduce yourself?

[00:00:37] Colleen Pentland Lally: Sure happy to I'm Coleen Pentland Lally, I'm with CBRE based in Boston, Massachusetts.

[00:00:43] Colleen Pentland Lally: I've been with CBRE for about 14 and a half years. Previous to my current role that is investment sales multifamily for the broader new England market. I was on our global capital markets team. Pre pandemic for a number of years I have worked across the US, UK, Ireland, Australia, and global markets as multifamily has expanded from the traditional US model into other markets, also focused on bringing global capital into US multifamily investments. So happy to be here.

[00:01:17] Charlotte Russell: Awesome. And David how about you?

[00:01:19] David Montague: Okay, thanks. So nice to be here. Hi everyone. So I'm David Montague. I spent a lifetime in property, a 33 years with L&Q, which is a large developing housing association. We owned and managed about 110,000 homes, and we had another a hundred thousand homes coming out on the ground.

[00:01:36] David Montague: I left just over a year ago, and now I'm working with Staykeepers, helping Lloyd's banking group with their direct investment, into private rents and a whole bunch of other people as well. So that is me..

[00:01:50] Dominic Grace: Hi, my name's Dominic Grace. I'm like David an advisor to Staykeepers.

[00:01:54] Dominic Grace: Previous to that up until the middle of last year, I worked at Savills, a big multidisciplinary property advisory and agency business. And I particularly had focus on residential development and investment work, and I'm delighted to be here today.

[00:02:09] Charlotte Russell: So let's get started. So the first question that we kind of wanted to delve into is how has multifamily kind of build to rent coped with the pandemic?

[00:02:19] David Montague: I can give a London perspective if that's helpful and then perhaps Colleen or Dominic can talk about the rest of the world. So I think I would imagine the London story is similar to any other city. We, we saw a bit of an Exodus during the early months of the pandemic and what people described as a, as a "halo effect".

[00:02:40] David Montague: So they're the kind of the hollowing out of the middle as, as people will kind of decided that they wanted to move to somewhere safer, they wanted to move back to their parents. And so we saw some pressure on rents. We saw some upward pressure on voids as well. Saw pressure on service provision because our labor force where we're either shielding or

[00:02:59] David Montague: or they were they were ill. We had trouble with access to homes and trouble with residents not wanting us in their homes. And of course, a lack of protective equipment as well. So it was a real challenge during those early months, but so the sector really worked together. Landlords worked together.

[00:03:13] David Montague: We, reached out to our residents. We, we connected with local and central government, and I think we bounced back pretty quickly as well. We were hit, but we weren't hit anything like as badly as the commercial sector. And I think if anything, we proved what a resilient sector the rental sector is.

[00:03:31] Dominic Grace: Sure I can sort of contribute from a prudent UK perspective, as David's covered a bit of London there, and it has been extraordinary how well the rental market has bounced back. There's a load of upward pressure on rental values now, and certainly in London. City centres and this sort of market looks pretty set.

[00:03:47] Dominic Grace: Fair forecast is likewise predicting that that sort of upward pressure on rents, which obviously playing well into the hands of the multi-family players is looking good.

[00:03:55] Colleen Pentland Lally: I would agree with that from the U S perspective. The market is as strong as it's ever been at this point and during the pandemic generally speaking, the urban core markets were hit the hardest. But what we found that surprised most people is that as quickly as those brands and occupancies cratered, they came flying back within months.

[00:04:16] Colleen Pentland Lally: We're beyond pre pandemic rents and most major markets. Absorption has hit absolute, I mean shattered previous records with the absorption levels. At this point last year, we finished with 617,000 units absorbed. Which far outpaces supply and supply is still quite healthy right now. The market traded a $335 billion last year, which was a 75% increase over the previous records, which was 2019.

[00:04:48] Colleen Pentland Lally: So 2021 is smashing all previous records across the board for every metric in the United States. I would say the exception of San Francisco seems to be a laggard, but everywhere else Population and household formation is up. Rents are up, vacancies are down. So the sector was obviously affected, but it was a very, very short term pain for multifamily in the US.

[00:05:15] Charlotte Russell: And I think that leads me very nicely onto my next question, which is where are the hot spots that you guys are finding currently? Is there a particular theme?

[00:05:23] Colleen Pentland Lally: I would say what we're seeing as the population shifts, which I know Americans tend to move around more than people in other parts of the world. But we're seeing kind of a mass Exodus, especially of young people from the higher cost of living cities in the north and the west down to the Sunbelt the Southeast Southwest or specifics, I would say Austin is an absolute hotspot.

[00:05:45] Colleen Pentland Lally: And Atlanta. All of Texas, very business friendly, very low cost of living, lots of job growth. So that's where we're seeing the trends. And then I might be a little bit biased, but there's a lot of data to back it up. Boston is a very, very hot Metro right now because we are the number one licensed. Market in the world.

[00:06:07] Colleen Pentland Lally: And so we have just tens of thousands of jobs, tons of development and life science, not that much development multifamily. So rents are up and the population is growing.

[00:06:17] David Montague: I think a similar position in the, in the UK. But I mean, the demand has increased, I think nationally Zoopla produced a report just a few days ago, which demonstrate the demand is 76% up nationally compared to this time last year.

[00:06:30] David Montague: And at the same time, supply is down new suppliers down by 15%. And so you've got this real tension across every, every part of the market. And at the same time, we've got the. The old kind of mom and pop buy-to-let investor exiting. And so there's pressure and that nationally this, that halo effect that was talking about, we were, we did struggle with with some empties in cities, but offices are reopening.

[00:06:52] David Montague: Students are returning global travel restrictions are easing. And so I think at the moment we see we're seeing. Strong demand in cities and also strong demand regionally, particularly as as investors follow this government sort of levelling up agenda. There's a real desire to, to invest in areas that have been traditionally neglected.

[00:07:12] Charlotte Russell: So, I guess my next question with everything that you guys have said is, do you think this demand will be sustained? And from an investor point of view, what's kind of the investor sentiment feelings.

[00:07:23] Dominic Grace: Shall I, maybe pick up on that one at the kick-off, certainly from a UK perspective. And I think David and I probably very aware with someone like Colleen and the audience, the, the U S market is so much, much more mature than ours.

[00:07:34] Dominic Grace: And, and often we look to the U S for a bit of guidance so that the UK market, for those that don't know really the sort of what's known in the states is a multi-family or single family. Product is really no more than the sort of five or six years old, in many ways in the UK, much talk of it in the years, running up to that.

[00:07:52] Dominic Grace: But in terms of actual product you know, out there in the marketplace, it is that young and there's still a lot of learning uh, uh, being had. I think if, if some of the, the earlier UK players probably, were slightly beguiled, when they did many study trips was which they did to the states, but they tended to congregate in terms of that target to the sort of upper quartile rents just, you know, they're very highly service type multifamily.

[00:08:19] Dominic Grace: Single family offering in the state. A lot of in the urban areas, certainly in the UK, a lot of developers have perhaps fallen into a bit of an elephant trap. They're trying to target what ultimately is quite a small market and a fail to address the more mass market. But that is, you know, people are learning those lessons now and responding accordingly.

[00:08:38] David Montague: If I can just perhaps add to that kind of a UK perspective before handing over to Colleen. And this is just from my own personal experience, working with a number of investors at the moment. I think we're seeing something of a, of a feeding frenzy. You know, every, every other week we seem to hear news of another.

[00:08:53] David Montague: Billion dollar or 1-billion-pound fund being launched, but in a particular interest in in, in single family accommodation, the trouble is that all of that money is chasing the same stock and the stock just isn't growing fast enough. And so we're seeing a real tightening of yields. And I think if we're going to be, if individual investors are going to succeed in this market, they really need to rise above that clamour.

[00:09:15] David Montague: And we need to start thinking about. Forging long-term strategic partners, partnerships kind of working together rather than competing against one another

[00:09:23] Dominic Grace: yeah, and I might just add to that again. It's such as the immaturity of the market and that given a number to the billions of pounds that David alluded to there, Savills, the firm that I used to work for.

[00:09:33] Dominic Grace: Have recently put out a document that has identified 35 billion pounds, trying to find a home if you'll excuse the pun in the sort of multi-family particularly the single-family market and there's David. That's simply is not the product for them to buy. And truthfully, we tend to use the acronym BTR build to rent, to be a bit of a catch-all.

[00:09:57] Dominic Grace: And the problem actually is that not enough players have gone sort of upstream as it were, and actually started to build product in order to let it out to the market. So it's more evidence perhaps of the immaturity of our market

[00:10:10] Colleen Pentland Lally: So it sounds very similar to what's going on here. There's certainly an insatiable demand as investors have moved at least temporarily away from office assets hotel assets, retail, which those were smaller sectors for investment anyway. But with the industrial logistics, Yields coming in. So tightly, you know, we're, we're starting to become the darling once again and multifamily, and there is quite a bit of product trading right now.

[00:10:35] Colleen Pentland Lally: So I would say the hot spots for investors as far as investor sentiment is still that Sunbelt. All across the Southeast and west of the U S that's where the people are going. That's where the land is. And that's where investors are chasing those deals. The rent growth has been extraordinary and continues to be extraordinary across these major markets.

[00:10:57] Colleen Pentland Lally: So we're anticipating. Probably, I mean, the rent growth is still very strong, abnormally strong right now. So we think it will normalize to more of a 6% annual rent growth over the next year. And then back to our normal three-ish percent rent growth annually going forward as the market kind of settled in some of the markets that investors are chasing that might not match up with

[00:11:23] Colleen Pentland Lally: the data that's saying these are the strongest markets, but investors are chasing are places like Tampa, which is actually my hometown, but might not be familiar to all of your listeners, but it's a Florida city, just west of Orlando on the Gulf of Mexico coast. So that has become a very popular place. Phoenix Las Vegas Some places in, in Salt Lake City, Utah, which might also not have hit the radar, particularly for global investors in the past, but are growing very, very strong markets.

[00:11:55] Colleen Pentland Lally: They're seeing a lot of investor interest. We are anticipating that the 2022 investment volumes will actually exceed 2021, which. Is astonishing to me. But time will tell, obviously we're in a very unique moment in time with what's going on in Europe. So I think there's a lot to pay attention to as, as time goes on and we see how things play out in Ukraine.

[00:12:19] Colleen Pentland Lally: And that's, you know, certainly I was on a European call yesterday and I think that everyone's kind of in a wait and see with regard to investor sentiment, because there's just no predicting how that's going to happen.

[00:12:31] Charlotte Russell: I agree. And I think do in the future predict more flexible leasing. Is that something that we're going to see more?

[00:12:38] Dominic Grace: I'm going to say yes, because it's inevitable that then the market needs to be more dynamic. I can't really comment so much on the U S markets, but certainly in the UK, we do still have a robust, straight jacket in market when it comes to the tenures and lease lengths as we call them over here. Right now, the market is still very much hinged around the, what we call it assured shorthold tenancy market, which tends to be for a minimum of six months.

[00:13:05] Dominic Grace: Maybe a year in terms of the initial commitment from the tenant. And there's an increasing recognition from landlords that they do need to be able to offer more flexible accommodation. And indeed ironically COVID I think and that's sort of perhaps change in lifestyles and, and work styles has pointed more towards more flexible sort of accommodations.

[00:13:26] Dominic Grace: So a simple answer to that question. Yes. It's from a UK point.

[00:13:29] David Montague: And just adding to that. I mean, certainly in my experience, if you, if you look on a Fizzy's website and they'll offer between 12 months and three years, that's fairly flexible. If you look on uncle's website, they offer between six months and three years.

[00:13:42] David Montague: So more flexible at the long end, but I think not flexible enough the shorthand and as Dominic says that people's expectations are changing particularly post a pandemic. And I've been through this myself as I have some personal experience I am in between homes at the moment. And it might be for two months, it might be for eight months.

[00:13:58] David Montague: I don't know, but the rental market just doesn't offer me what I need. And so, you know, I find myself in Airbnb type accommodation instead, and I think there's going to be a real drive. The, the rent, the rental business, just doesn't suit modern lifestyles at the moment. And I think it's going to have to adapt in order to, to cater for the needs of 21st century people.

[00:14:20] Colleen Pentland Lally: I might, I might have to be a little controversial, cause I'm going to say there will be less flexibility or I shouldn't say less flexibility, but we'll maintain the same level of flexibility that we have in the US whereby, vast majority of institutional quality, professionally managed assets are on 12 month leases.

[00:14:38] Colleen Pentland Lally: That's the way it is. That's the way it's always been. And with the way occupancies are at the moment and they ability that apartment managers and owners have to continue to push rents, given the demand. There's just, if, if the resident isn't happy, No that tenure in a particular building, they can go find something somewhere else.

[00:15:01] Colleen Pentland Lally: That's with the way our pricing, the model's priced these units. There'll be pricing them on 12 month leases. If you'd prefer something shorter, the rent will go up. And that's kind of the way things are in this, in this particular market. So, flexibility, isn't something that American renters expect from a professionally managed institutional quality building.

[00:15:23] Colleen Pentland Lally: When you go to one of these buildings, you would anticipate a 12-month lease. There's certainly options optionality, but it will change the cost of the rent

[00:15:32] Colleen Pentland Lally: and I did want to bounce back a bit back to investor sentiment. I wanted to tag on to something that both of you mentioned with the single-family rental trends.

[00:15:40] Colleen Pentland Lally: That is something that is ramping up in a meaningful way. I mean, I did state we, oddly enough, after. A good chunk of my career, trying to convince people in the UK to not use, build to rent and use multifamily. The Americans now have adopted BTR for the single-family rental sector. So we are now doing build to rent for single family, or you're doing.

[00:16:01] Colleen Pentland Lally: Build to rent for multifamily, but we all know what we're talking about, but it's become a really big part of, of, of investor demand. It's very early as it is in other places, whether it's a build to rent single family rental community, or the hodgepodge of buying up portfolios of homes. Personally, I feel is, is obviously less efficient.

[00:16:22] Colleen Pentland Lally: The second thing and investor sentiment right now, and investor interest is affordable housing, which has not been something that institutional investors have really focused on in the United States. But right now, Every investor that we, every major investor that we spoke to at the national multi-family housing conference in January has launched an affordable housing fund.

[00:16:43] Colleen Pentland Lally: They are actively out looking to spend billions of dollars in affordable housing assets and they are preserving the affordability and those assets. So it's a, it's a very big push into that market. I, I think that investors have. Found ways, which I always said to my German counterparts is how they manage those investments in Germany.

[00:17:03] Colleen Pentland Lally: Investors are finding ways to invest in these types of assets continued to achieve the returns they're looking for whereby preserving the affordability for residents. So interesting space to watch is that continues to.

[00:17:16] David Montague: Can I just add something if I may on just something Colleen, you said at the beginning about the way that the American market is working at the moment in terms of flexibility.

[00:17:24] David Montague: I think it's inevitable that the vast majority of people for the vast majority of people, six months, 12 months, and more is going to be what they are looking for. But I do wonder if there is room for. And preservation of a slice of each block or a slice of each portfolio, which recognizes the needs of some people for more, for a more flexible kind of tenure.

[00:17:46] David Montague: And it's quite possible that both can coexist and, and by allowing some space for more flexibility, within a block, within a portfolio, you can increase net operating income. You can create a more diverse community and which, which is going to help the local economy as well. And perhaps just make it a more vibrant place.

[00:18:04] David Montague: So it seems to me it could be a bit of a win-win.

[00:18:06] Dominic Grace: say that I think there's an element of landlords needing to be prepared as well for a less frenzied at market than we've got now. And that full I, again, I speak from a UK perspective, this shorter stay is a very new offering. So I think landlords getting used and working out how they deliver that shorter stay is, is very wise because I think it's fair to say the market will not be as strong as it is now.

[00:18:36] Colleen Pentland Lally: I think some flexibility can work in. I, and you know, and I think a model like the Staykeepers' model could really come into play as a benefit to some of these assets. I would say that some of the earlier entrance into that market pre pandemic you know, there, there were some challenges around the way those integrations were working.

[00:18:57] Colleen Pentland Lally: I think it just will take some time to figure out what is the right fit. If there is a portion in certain assets to bring in some kind of shorter stay model. And one thing I did learn as you know, we're working in the UK over the years is that making sure everyone is aware, there are many different models, there's a huge spectrum of housing options, and there should be a huge spectrum of housing options.

[00:19:20] Colleen Pentland Lally: It's not a one size fits all model and it never will be.

[00:19:24] Charlotte Russell: And as you're talking, I'm no saying there's a lot of similarities for kind of between US and UK, but there's also a lot of differences. Do you think the, kind of, all of the models and the markets and the way the investors are investing, do you think they will kind of grow more similar over the years? Or do you think that there will be kind of differences in how, how things evolve?

[00:19:43] David Montague: I think the UK is following the U S I am sure we got lots to learn from each other, but the U S market is far more mature than here in UK. We've got a lot to learn.

[00:19:52] Dominic Grace: Yeah, I think the fundamentals and it's very easy to sort of celebrate the differences, but wow. There's probably more similarities to celebrate.

[00:20:00] Dominic Grace: And I, you know, never mind between the UK and the U S I guess think globally you know, the, the, you know, it's the rental versus ownership model is pretty hardwired into most housing markets. So I think you know, the fundamentals remain the same

[00:20:13] Colleen Pentland Lally: I agree. I think the fundamentals remain the same. The markets are very similar.

[00:20:17] Colleen Pentland Lally: You know, if you look between, you know, the markets that I've paid most attention to between the UK, Ireland and Australia, people need housing, they need affordable housing. They need all sorts of housing. There is a shortage of housing, so that's just fundamental. So that's the same across all of our markets.

[00:20:35] Colleen Pentland Lally: I think that. Piece that we'll need catching up is actually more on the regulatory side and planning and taxation. Certainly in Australia there's some major issues on how multifamily is being taxed at the moment, which is simply. Because the asset class didn't exist before. So there's a lot of regulatory situations that need to be worked out.

[00:20:59] Colleen Pentland Lally: Certainly different jurisdictions. I I'm sure things have changed since I've been in the UK. Since 2019, and the last time I could get over there. There were still some issues of, you know, different planning boards and different planning boards would try to dictate different things to developers and to investors and all those things will continue to work themselves out.

[00:21:20] Colleen Pentland Lally: But overall, I think fundamentally the markets and the demand drivers are very, very similar.

[00:21:26] Charlotte Russell: Yes. So what I was thinking is, We've covered quite a lot on the demand and kind of how will that holds for the future. But in terms of technology, are people really using technology and providers? How will this kind of evolve in the future? And do you think technology will play a bigger playing more.

[00:21:46] Dominic Grace: I think simple answer. Yes. Cause it must do gain from a UK perspective. A lot of things that David and I keep saying a very new, and that's a fact, but even then for the older established rental market, which wasn't so institutional much more mom and pop as David described it the management of residential has been very, very clunky.

[00:22:07] Dominic Grace: And the erosion between gross rent and net has been truly appalling compared to sending commercial investors. One of the opportunities now is that if you like commercial investors is now gravitating towards residential and want to bring much more efficiency to the whole system. And in order to do that, there's going to need a bit, a much more adoption of slick technical.

[00:22:30] David Montague: Again, from a UK perspective, I think that the market breaks down. And so you've got the, kind of the old kind of legacy owners and managers, the, the local authorities, the housing associations, and they've been using the same systems for a very long time. And as Dominic says, they are very clunky. There hasn't been enough investment in them over the years, but those.

[00:22:51] David Montague: Big landlords and are facing big new demands, net zero fire safety, modern methods of construction, the need for better building information management systems and their, their legacy systems I think, are struggling to cope. But we've also got this kind of new breed of investors, this new breed of landlords and, and they're, they're not, they're not as they don't carry the burden of those legacy systems.

[00:23:14] David Montague: And so they, they, they have a blank sheet. They can, you know, they can just start from scratch, which, which is a great advantage. But I think the thing that they struggle with, there are some amazing prop tech companies out there at the moment. But I don't think anyone's providing the end to end service that's really needed.

[00:23:28] David Montague: So you'll get somebody doing a great letting service or, or, or brilliant maintenance system, but we're not seeing end to end at the moment. So there's a real need for collaboration. For integration, I think PropTech has got a long way to come a long way to go within the uh,

[00:23:44] Colleen Pentland Lally: Yeah, I think we were really starting to see some companies that are getting close to what you're describing and there are systems like black that have come around.

[00:23:55] Colleen Pentland Lally: Right now they're known for their entry systems keyless entry, building security, things like that, and broadening into overall operating systems that include leak detection. Thermostats integration with lights. All sorts of integration on butterfly is now the entry system that we're really starting to see in all the newer buildings, butterfly, MX, same thing, and a great cheer phone.

[00:24:19] Colleen Pentland Lally: It's great security for management companies. Great security for residents to see who's coming, allow them on their smartphones to let people in and out or tell some member to drop their food for delivery or what have you. So those types of kind of nuts and bolts technologies are coming fast and furious and.

[00:24:38] Colleen Pentland Lally: That the number one. I guess key to some of those systems is that operating system, how an integration, how does it integrate with everything in our lives? And, and these, some of these companies are really starting to make a lot of headway. I would say another piece related to the property management and leasing that Dominic that you had mentioned is virtual tours and self-tours, self-guided tours have become a big piece of the puzzle.

[00:25:03] Colleen Pentland Lally: We know some of the younger generation they'd rather. Not be interacting face-to-face with other people and they want to just do a self-guided tour, or they would like if they're moving from coast to coast and need to do a virtual tour every time I'm in a building now that we're potentially selling, we'll see the managers walking around with an iPad, giving people tours either a renter, maybe their parents want to see what it is or they're not in the market and they want a virtual tour.

[00:25:29] Colleen Pentland Lally: So we do see quite a bit of that. The other, the other. Goes hand in hand with technology, but also amenity building amenity is potentially moving away from lots of dedicated space. That's a shared amenity. When you walk through. A core class, a brand-new building right now, you see people sitting in these shared amenity spaces working alone.

[00:25:55] Colleen Pentland Lally: So what we're seeing more of is creating spaces where people can work, they can make calls, they can work different styles of workstations, where they can go in different times and bandwidth needs to be absolutely. Superior residents will come into a building and test the bandwidth as part of evaluating if they want to live there or not.

[00:26:16] Colleen Pentland Lally: So that is absolutely critical. Having USB ports in the units, USB ports in the common areas plugs everywhere, Wi-Fi, everywhere, and spaces to work. I think we'll start to take over from billiard rooms and theatre rooms and things like the big, expensive shared amenities pools. We obviously see more of in the south, but we do get them in the north, but you generally don't see many people at the pool.

[00:26:42] Colleen Pentland Lally: So is it worth that or will a resident be more willing to pay for really incredible space for them to work from home? Any buildings?

[00:26:51] Charlotte Russell: I agree. And I think, is there anything else from you all in terms of what the future holds? Is there anything else you'd like to make.

[00:26:57] Dominic Grace: Well from a UK point of view, I think the risk of repeating ourselves, we're still very early in the journey, but the weight of money that both David and I have alluded to means that boy is there going to need some, to be some fast learning and I guess without sounding negative about it, some of that money, money, it's fair to say he's already being badly deployed because so often when you got that much weighted.

[00:27:19] Dominic Grace: People, you know, out of frustration, they feel like go to deploy, say they do end up buying forward purchasing rather than building they buy off the big house builders knowing it's probably in the wrong place, the wrong type, not, and won't perform as well as it should do both from a rental and indeed a capital growth perspective.

[00:27:36] Dominic Grace: So that's almost inevitable, but a learning that's going on. But we, we, again, repeat ourselves, we will look to the states, and we look forward to catching up with the likes of Colleen.

[00:27:50] David Montague: I will join Dominic and his worship. I think the key thing for me is that I think that over the last couple of years the, the rental sectors has proved its resilience.

[00:28:02] David Montague: You know, we struggled, but we not as much as others. And when we bounce back pretty quickly, as far as the future is concerned, demand will continue to outstrip supply. We might be facing some, some short-term worries in terms of cost of living increase in mortgage rates. And of course, who knows what's going on in the Ukraine, but we've proved ourselves to be a resilient sector and I think more than ever, there is a need for us to think about long-term investment in the rental market.

[00:28:30] David Montague: And that must mean an opportunity for PropTech as well.

[00:28:35] Colleen Pentland Lally: Yep. I would agree with that. I think in the us being a more mature market in the near term, looking forward more of what we're seeing were population shifts, migration shifts. Hopefully we'll start to see some immigration come back, which we know.

[00:28:49] Colleen Pentland Lally: Or five years have not been great for that in the us. We desperately need a lot of the people that were no longer here to come back to our schools and our jobs which is would be terrific. But I think that also boosts our major markets to have more people come in more potential renters, higher earners.

[00:29:03] Colleen Pentland Lally: I think the long term. Change and forecasts that I would see, which is something that oddly we'll be learning. I think more from Europe is bringing in more of an ESG component into our new development. We are seeing European investors right now telling us if a property does not have an ESG component, they cannot bring it to.

[00:29:26] Colleen Pentland Lally: They can't bring it to the table at all. It's just completely off, off the, off the table. So in addition to it being the right thing to do resiliency is something that's going to take a huge hold in our coastal cities in a lot of ways. Anyway, we're seeing new developments here in the Boston area requiring resiliency against C-level and climate change.

[00:29:45] Colleen Pentland Lally: But I think the ESG component is something we're going to see a huge, huge amount of focus on over the coming years. And that that I think is a good thing. And then another thing to watch and I'm sure it's in many markets elsewhere is regulatory control. So many of our major markets are starting to see a different levels of rent control, lag.

[00:30:10] Colleen Pentland Lally: Different types of affordability requirements come into play. So we a trend that we're hearing as investors looking towards a lower regulatory environment state, which tends to be in the south. So we'll see how that plays out as well.

[00:30:26] Charlotte Russell: Awesome. Thank you all for joining me on this podcast, links to connect with clean David and Dominick will be in the show notes and join in the discussion with stake keepers on our LinkedIn. And if you have any questions, please reach out. Thank you all for joining.