Posted on June 18, 2018 by Gordon Smith
The UK property market is going through a period of significant change. Home ownership, especially amongst young adults, has dropped to 27%, compared to 65% two decades ago and is showing no sign of climbing.
In response, we are now seeing the rapid growth of Build-to-Rent (BTR) or Private-Rental-Sector (PRS) developments, wherein apartments or housing developments are built to a high spec and provide all the latest premium facilities and services to attract long-term tenants.
The sector has attracted £2.4bn in investment in 2017 alone and is set to grow 180% over the next six years. And it’s not just a London thing- whilst the capital is leading the way, Manchester is seeing a boom in the BTR sector too.
If you are a BTR or Private Rental Sector developer, this article is aimed at helping you understand how gym facilities can give developments an edge and help attract high-earning, long-term tenants.
The Build-to-Rent demographic
BTR developments are not only attracting 25 – 35-year olds whose earnings are in the middle-income bracket but also older people who are looking to downsize to a smaller house or apartment, without compromising their lifestyle.
Students are another target market for PRS, as the cost of accommodation in halls of residence is now working out almost the same as BTR. And with charges such as the so-called Mansion Tax looming on the horizon for the more affluent demographic, rental is starting to look like a better option for many people all round.
BTR developments are designed to attract long-term tenants and to achieve this, it’s important to provide services that make it more desirable than the Build-for-Sale sector. These commonly include a concierge service, co-working spaces and communal or social spaces.
This is why a gym is a crucial element for your development. It gives tenants the chance to work out 24x7x365 and creates a social (but not public) space for people to meet other residents. For a tenant, it could be the make or break difference between your development or a competitor site.
How important is a gym in a BTR development?
The average length of a tenancy in the UK is 20 months(1). The key challenge for BTR sites will be ensuring tenants stay for the long haul – putting down roots and sending children to school in the area they rent in. If the growth rate is anything to go by, this is set to be a very competitive market where value-add will be everything.
Tenants factor in a wide range of reasons to sign up and stay – the top reasons are location, size, price, parking, transport links, council tax, proximity to schools and other amenities obviously have a part to play. But that’s not the whole story.
In the typical BTR demographic all the potential customers are keen advocates of exercise. Both millennials and older generations, in the 50 – 70 years age bracket, take exercise seriously and are, in fact, some of the most frequent users of gym facilities.
Interestingly, they are also more likely to join a boutique gym and participate in group exercises, which would suggest they are looking for a more premium exercise space than a mainstream gym.
By providing an on-site gym, you are responding to that need for a boutique service, as well as giving residents the freedom to use the space without worrying about peak times or accessing equipment, as you would a private gym.
Offering additional value-add gym services, such as a personal trainer or classes, will also help tie in residents and, again, respond to that boutique requirement and group exercise.
As community is a key USP for BTR, communal spaces and activity will encourage this and help get neighbours talking and establishing relationships. This takes time, but creating a space where people meet, do classes and exercise regularly will help speed-up this process.
The key to staying competitive in the fitness industry is always keeping ahead of the ever-changing exercise market. As part of this, it’s important to make sure you choose and invest in modern, exciting equipment that is also reliable and easy to maintain.
This means you will need to consider the maintenance and upkeep of the gym in your long-term plan.
Gym design is highly trend-driven. Regular planning and education on the fitness industry will help. It helps to work with consultants who understand the changing fitness landscape and ensure you maintain an edge over new sites. Meanwhile read our top picks for the latest gym equipment which includes power racks, resistance bands and Total Body Resistance Exercises (TRX).
Exercise needs vary
Each generation finds different, innovative ways to stay fit. Exercise needs are changing rapidly, and your tenants will expect you to be in front of these changes. More recent trends include HIIT, sports-based training and body weight training.
But it’s important not to second-guess. We have found that it’s very useful to establish relationships and work closely with tenants to identify their fitness needs so you can respond accordingly. This gives you the chance to give tenants what they want, whilst residents can get a positive boost by being part of the future of the development.
Installing a gym and then leaving it ‘as is’ for years is not the right approach to fitness these days. Additionally, simply having a few pieces of cardio equipment and a watercooler is not what people want, or expect.
Tired and old-fashioned gyms are not a good look and will put off potential tenants rather than attracting them. With tenants paying a premium for services, a broken machine just won’t cut it, and could, potentially, be a deciding factor for residents moving to another development if it becomes a frequent occurrence.
Equipment does need to be serviced regularly so it works well 24×7. There are many things to consider when creating a gym space as the days of endless treadmills are over and are now being replaced by functional fitness or resistance equipment and HIIT workouts.
At motive8, fitness is our reason for being. We consult, design, install and maintain gyms for hotels, businesses, student and residential accommodation, so we know what works and what people want from their exercise space.
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