Later Living - the sexy part of the property sector with Honor Barratt

Our latest podcast episode from our Summer Series is now available to listen to. In this episode we chatted with the trailblazer Honor Barratt, CEO of Birchgrove.
 
Birchgrove is a specialist age-exclusive developer working to establish a portfolio of later living neighbourhoods with well thought-out facilities for rent.

Some of the topics we cover in this episode:
🟣 The reputation of later living as dull and beige
🟣 The stigma around renting in later life
🟣 Home ownership being boring in older age
🟣 The opportunity to free up housing stock for families
🟣 Rental later living as the sustainable choice for the future
🟣 Rent controls and protecting the future renters
🟣 Security of tenure above everything else

Each week, Sarah Canning, Deenie Lee of The Property Marketing Strategists and Daniel Smith of Student Housing Consultancy will be delving into a wide variety of subjects and asking the questions that aren't often asked. This podcast is for anyone who works in Student Accommodation, BTR, Co-living, Operational Real Estate or Shared Living.

Disclaimer: The views and opinions expressed in this podcast are the personal views of the individual hosts.

Transcript

Copy Transcript Copied

SPEAKER_02 0:00

Hello and welcome to this very special episode of Hell, the Shared Living Podcast for Summer Sessions. This is a mini-series of special episodes with some very interesting and relevant guests to get used to in the summer. Maybe you're listening on holiday, maybe you're driving your kids to childcare, or maybe you're on your future community. I'm Sarah Kenning from the Property Marketing Strategy.

SPEAKER_01 0:21

I'm Dan Smith from Student Housing Consultancy.

SPEAKER_02 0:23

And yes, we are a host down this week as Dee Lee takes a well-holiday, but we didn't want you to miss out on what will be a great episode. However, you listen, we're delighted you're with us today to hear from Honor Aaron from Birch Grove, a name many of you can recognise as someone who was first onto the shared living scene in the past year or has she? Anna, would you like to introduce yourself?

SPEAKER_03 0:43

Yes, hello, Sarah and Dan. I wish I was listening to this on holiday. That would be glorious. My name is Anna. I'm the chief exec of Birch Grove, which I would say, in summary, is built a rent for old people.

SPEAKER_02 0:54

Fantastic. And we're really excited to delve into more of that quite unknown sector. Well done on being shortlisted for the Property Week Inspiring Women Awards. Very exciting, hot off the press. That was funny, wasn't it? Thank you, Sarah. And I guess that's a good place to start because to be frank, when we were trying to get you to be a guest on Housed, you were worried that you had had too much exposure and people are sick of hearing from you. Whilst I can confirm that is certainly not the case, have you really just appeared in the sector over the last year? And why is it that we're just hearing about you now?

SPEAKER_03 1:25

Okay, there could be a couple of theories. First theory is you two haven't been paying attention. Maybe I've been here all along. Second theory is that in later living, we are such underachievers. It's taken us so long to get to where we've got to that normal Rezi is only just waking up to later living. That could be a theory. Is it that in property there is sometimes a bit of complacency because we can build things and fill it and you don't need to go and look around to complicate your lives because you can probably make some very good money doing what you do, so you don't have to look around. Or my favourite theory would be that you guys have finally realized that later living is the sexy bit of the sector, and you are just waking up to God, how much money can be made out of later living. That's my theory, why you've only just heard about it.

SPEAKER_01 2:13

It's been really good to see later living represented, especially by people like yourself. You're very compelling and engaging, especially on the stage, and very honest and transparent. It's not something that we're really used to in real estate, primarily used to the blue suits of investment. And I think it's it's really refreshing that you've been able to inject that enthusiasm. Now I know you're trying to sort of innovate the sector, but why do you think that later living has that reputation of being slightly dull, slightly beige? The antithesis of what you said, the unsexy sector. So what are your thoughts?

SPEAKER_03 2:44

Possibly, Dan, the sector sometimes conflates us as all old people are a homogenous mass of over 65s, and the dominating force in the over 65s is probably the care home. So if we all think about care homes, it is dull and beige, in my opinion. I think what's really interesting, people of your age, so Dan and Sarah, how young you are. Dan, you've talked about checking your granddad into a later living experience, and it probably was a little bit beige, and it's quite conceivable there were people sitting around watching telly or even nobody around at all. And so that will set the tone for what you believe it is that I do. And so in your head, I reckon it's still that, and there's quite a lot of damage to be undone there. When you get to my age, my parents live in our woking community in Birchgrove, and they were never going to settle for that shit. That beige stuff that wasn't going to work for them. So the sector is considered beige, but it's the consumer that's saying, I'm not taking beige anymore.

SPEAKER_02 3:41

To be honest, I mean, you know, I've worked in the property sector for 20 years, and I'd say it's probably only in the last 12 to 18 months that I even had an idea of sort of private rented living for the older community. I know it exists in social housing, but I wasn't really aware that it existed in you know the private sector. And I think anybody that I've talked about it, because I'm like, wow, guess what? There's this whole sector that exists. Everyone always says, Well, you know, why would my parents, why would my grandparents sell their house to rent? You know, that seems counterintuitive. So do you think that's kind of one of the issues is that it's so new that they just can't comprehend why somebody would make that choice?

SPEAKER_03 4:22

Yeah, it is really new. And I think if you read the Daily Mail, you're never going to make that choice because you are told constantly that you're defined by your home ownership. And definitely all of us, if you own a home, you've probably made more out of the rising house price than any of us do out of jobs. So why would you stop that sort of gravy train? But what is also true is that home ownership is bloody boring. Once you're 80, it's actually hard, you can't do anything for yourself. Why do we think that home ownership is nirvana? Like we're the only country in the world who's obsessive about home ownership, and I just think we need to wean ourselves off that. There's nothing wrong with renting, and interestingly for me, Sarah, apparently 30% of all student lets are guaranteed by the grandparents. We're already engaging in the rental sector, we're already being slightly desensitized and going, oh god, maybe this isn't, you know, it's not so tawdry, maybe it's not so terrifying. But I would definitely say that if you consider renting in your later life, you are weirdly an early adopter. You will not have any friends who've done it. You will be a pioneer, you're being asked to take quite a risk. At the age of 83, you're asking to do something that none of your friends have done. And it is a leap into the unknown. It is a leap of faith. And the Daily Mail is not helping by telling you that you're defined by your home ownership.

SPEAKER_01 5:42

When you look at Europe, so so many of the older generations they have rented their houses. Why why is it that the UK is so anti-renting, do you think? And and I don't know, it's it is quite easy, and I do blame the Daily Mail for a lot of things. But do you think there's an appetite to change that? And and how can we go about changing that sort of negative attitude towards renting in later life?

SPEAKER_03 6:04

Okay, so this is where I think I really wanted to meet you two. So I'm like, you know, you two spend your lives thinking about this just as much as I do. What is this stigma and how do we blow that out of the water? What do you think?

SPEAKER_02 6:17

So one of the things that I think is quite interesting is, and I hadn't really thought about this until I met this guy who rents. He's a single parent. He's in his, I think he was in his like late 20s, and he rents and he was telling me he'll never be able to afford to buy, and he's kind of fine with that. He gets to live in a great house at a great location, and he wouldn't be able to afford to buy because he owns a good amount of money, but not enough to save a big deposit to buy somewhere. So he's cool, he's got a good job, he's got bringing up his daughter in a great place, a great school. But then he said to me, But what happens when I'm older? Well, how do I carry on renting when I'm not earning any money when I'm retired? And the the problem, I think you know, you've got this, and and it's not it's not just later living rental, it's BTR as well. We've kind of created a really high-end product around renting, and then you've got social housing, and you don't have a great deal in between at either end of the market. So I'm talking about PBSA and later living. And so you know, I guess maybe that's why it's it's a it's a dirty word because people don't understand how they can sustain that lifestyle. And I don't know how they do it in Europe once they retire. Where does their money come from to you know enable them to carry on renting? I suspect it's probably cheaper in a lot of European cities for a start, so they have more disposable income. So maybe they've been able to save more, maybe they have great pensions and they're able to continue to rent, maybe they have better social health care. That means that they're not scared of what will happen when they can't afford it. But you know, is it is it all of that?

SPEAKER_03 7:54

I think it's all of that, and then I think, and it this is a dirty word in rental, but I think they have rent controls. Our housing market, it's like a hot air balloon, isn't it? It's so tight, it's so taut, and we're all putting our rents up so much. But I don't believe you get that in a town like Frankfurt. I do think that there's rent control, there is protection, your rent will have to go up in the same way that your income is going up, and you're less under threat of just being evicted because your landlord can get more money from somewhere else. So, as much as it is slightly terrifying for us as a rental industry to be looking down the barrel of those things. For me, giving someone like your acquaintance, who's a young man raising his children, giving him some certainty of tenure, I think is really important, isn't it? We do need those renters' protections that he can't just be evicted. And will that take some of the pressure out of this market so that we're not I feel like I meet loads of people who are minutes away from disaster? Like if you lose your job within about 10 days, you're probably running out of money. And I don't believe that that happens in Europe. I do think, as you said, you are able to save a bit more and protect yourself. I get really worried about that, how close so many people are to just the edge at all times and and that feeling of insecurity of not having well, you could call it security of tenure, or you could call it home as the springboard for your life to take risks and have an adventure and try a new thing. If you don't have that solidity of that base, you don't do those things. And then the economy doesn't grow. And I do think that the Labour government does understand that connection between growth comes from a really strong springboard, and the best springboard in the world is a sense of home. It's feeling the security to take the risk.

SPEAKER_02 9:33

I do think that marketing has got something to pay for it, and you know, I'm a marketeer, I haven't directly had the opportunity to market later living marketing or BTR, but from what I've seen, I do think that one of the key messages that's being missed is security of tenure. I see all of these billboards and adverts on the tubes and pages in the evening standard, and it's all about the sexy facilities, you know, it's all about the rooftop bar and the gym and the concierge and how many minutes it is from the tube. And that's all fantastic, but I don't see a single message about and it's not sexy, but you know, we're not gonna kick you out, we're not gonna, you know, sell from underneath you, and we're probably not gonna put our rents up 20% within a year.

SPEAKER_03 10:21

But we all know Maslow's hierarchy of needs, don't we? And the base is shelter. Like, why are we not why do we not market to the most fundamental needs in the world? We we're told all this stuff down at the bottom, that's most important. But I I guess you two probably haven't written a marketing message to the bottom of that triangle.

SPEAKER_02 10:39

No, and also like we always talk that you know, BTR is a industry terminology. What what is the terminology for rented later living? It doesn't flow off the tongue. So I don't think that you, you know, I see things like built for renters, you know, rented property, but I still think that, you know, if you're if you're looking at some hoarding going past a new development, I don't think the you know general public are taking that in. I think you just assume that's another high-rise apartment block with you know really expensive apartments to buy. I'm down in Bournemouth at the moment, and because you know, I'm a marketeer and I'm obsessed with property, I read every single bit of hoarding, and there's one that I saw that didn't mention parking, and I was like, well, I think they've missed a trick there, because if you were going to buy a really expensive apartment here, and you know, my dad who I was with was just like I didn't even notice that because maybe the general public don't, and as marketeers or as people working in the sector, you might think things are obvious, but actually I don't know if people are just assuming if you're building apartments, they must be to buy, and therefore it kind of doesn't really matter what you're saying on it because they're not reading it.

SPEAKER_03 11:50

I don't know as much about BTR as you two do, but I wonder whether you see the over-amenitization of it and thus going crazy for pooch parlours and rooftop bars, and you want to drive past and you want to see parking. That's that's like fairly basic. I don't know whether we are the marketeers in us are building bars that are never gonna have anybody in them because we it's an important part of the sales journey, or we believe it's an important part of the sales journey. And I think in my places, if somebody walks in and says, Oh gosh, this is luxurious, I think I've done it wrong because I don't want them to think luxury. I want them to feel, oh, I could make myself at home here. I want them to kick their shoes off and curl up on the sofa. I don't want them to go, oh my god, look at that rooftop bar. So it's really funny, isn't it, about those messages that we respond to. Certainly when we launched our first development in Sigcart, we put the word rent on the hoardings and then just loads of people called up and said, Do you take housing benefit? You were like, Oh gosh, that word rent is really nuanced. It means something that it shouldn't, but it does. So we had to redo all the hoardings, take the word rent off, and start that journey from the very beginning. We couldn't even say the word rent until we we committed to always be 40 minutes in front of the customer before we say the word rent. Because if you say it any earlier, they're out the door. There's like, oh no, that's not for me. I have one amazing old buffer called Peter, who sort of recoiled and said, Well, Honor, I've always thought of myself as an owner. And I said, You're only known Peter, but you're 87. Does it make sense to give me three-quarters of a million quid for an apartment? Or does it make sense to take this apartment month by month? It's funny, isn't it? But I think we are slowly knocking away at that. And actually, Dan, where your grandfather ends up in Max Stone, they're now doing rental, and they're such a behemoth of the industry that actually, if they start spending marketing pounds against the word rent, I will benefit.

SPEAKER_01 13:36

Yeah, that will change the industry. And I think we're terrible at categorising things. We come up with acronyms like you know, we've got PBSA for purpose-built student accommodation, BTR built to rent, and then I think you've you've got later living, retirement living, later living rental, and then you sort of start thinking old people's home. And I think there's there is a bit of uh an identity crisis ultimately for the later living sector, as there is for pretty much every other sector as well. But I think more so in in that rental piece, because it is, it feels like it's a lot newer, people aren't quite used to it yet. But you're right, it makes a lot of sense. Why would you, at 87 years old, even you know, into your 80s, want the hassle of buying a new place, moving all your stuff in, etc. Do your villages, are they furnished, each of the apartments?

SPEAKER_03 14:23

So I believe that to feel at home, have a sense of home, you should be like a cat and you can go and spray up against all the walls and make it just like your own home. And I think the Cuban Cuban version of spraying against the wall is to put your own pictures up and put your, you know, change the carpet. Whatever you want to do, it's your home. I'm not gonna penalise you for any of it because the more you feel at home, the less likely you are to turn against me and hand me a notice. So uh I'm in the cat spraying strategy. I'm never gonna penalize you for doing that.

SPEAKER_01 14:56

I think that's really important. It's something in student and BTR, I think, that we're we're not that good at because you know, if you leave blue-sack marks on the wall, you'll get fined. And if there are marks, then you might lose your deposit or whatever. Now we are building homes and creating homes, but these are homes typically for six months, twelve months, depending on on the contract. What sort of contract lengths do you typically see? And that's not me sort of trying to eke out your life as well.

SPEAKER_03 15:24

I mean, I've never run a unit BTR building. But if you did allow them to put Blue Tech marks up, would you get more tenure? Or do you not want the tenure because every time they leave you disproportionately put the rent up in a way that you can't if they're there? So a churn is not to be mourned in BTR because the next person who comes in is paying 15% more. Is that why there's no blue tech? I don't know. I don't run one of those buildings. But I I would love to get four and a half years out of mine, so I let them put blue tech.

SPEAKER_02 15:54

Do you know what though? That's a really interesting point. I I grew up, uh you know, I I was uh a victim of the the recession in the in the 90s. We lost our house and and I grew up for the most part of my my youth in rented properties and we stayed in one, I think we lived in one for like seven years or something, and it was home as far as I knew. I didn't know whether we rented or bought because at I don't know, like 12 years old, you don't you don't know about these things. But my mum painted my bedroom purple and um it was terrible. Like she should not have been allowed with a paintbrush. But I loved it, that's how I wanted my room, and then over the purple, I had take that posters all over the walls because I was a teenager, I wanted to feel you know, and I I don't know that I ever expressed this, but I think my mum recognised that I needed to spray out the walls and make you know an identity for myself and make myself feel at home. But the landlady went mad and I think we had to pay to get it redone, and it's you know, that stuck with me because that was my room, that was personal to me. And I think that you know any generation that's grew up or grown up either renting or knowing someone that's rented, and this could probably go into HMO living, you know, graduate living student accommodation. They've probably got this fear of oh my god, I can't put a shelf up, you know. And I I'd say, you know, most of the properties that I've ever rented or you know, been involved in renting, you sometimes feel like you've improved it, you know. Oh, actually, you know, that would be so much better if there was a bookshelf there and everything.

SPEAKER_03 17:26

Who doesn't want a bookshelf? I just think your mother would have known that that penalty's coming, and then there was a decision point in her head. Do I try and make my baby feel at home and and incur the wrath of the landlady? Like we've all done it. I remember putting in a cat flap thinking, well, for me, I have to have a cat, and I put it in knowing that I was going to get penalised. Why do you want to stop people making themselves feel at home? But that was really, really interesting about what your mother did to make you feel like that was your palace.

SPEAKER_02 17:56

Yeah, but I listened to the news agent's podcast a while ago. I think I posted about it on LinkedIn because I found it so fascinating, and they were talking about the problem in the UK with our population, and that we're not seeing population growth like we like other countries are seeing it. So they interviewed a load of people about why that might be. And I mean, they obviously clearly picked up people that match the narrative that they were trying to portray, but interviewees kind of mainly said the reason that they're not having children is because buying a house is so expensive and they want a secure home to bring their children up in. And I was literally shouting at my headphones because I was thinking, why is it that owning your own home equals security? And none of them said, actually, I am going to have children because I have got an amazing place that I rent that's really secure. And you know, maybe it's a generational thing and it and it will come once people see their grandparents living in these places, but it's probably not so much the age currently, if that makes sense. There's all there's all these this kind of baggage about renting.

SPEAKER_03 19:06

I don't know whether that is about renting, Sarah, or whether so my this is a ridiculous sentence, my favourite waitress at Soho House, who I adore. And she she and I have known each other like 15 years, and and she was telling me that she has two kids and she's married, and she just was renting a new and it cost 2,800 a month, and so her girls had to share a bedroom and they were living with her brother-in-law, so they had to get three adult incomes into that flat to make it work, and the girls had to share a room. And I know she's a waitress, and I'm thinking, how do you get to 2,800 quid a month? It is insane as well. So I don't think it is about I think it's whether you're renting or a homeowner. Having an extra child is a real it's absolutely has to be thought about, and as a result, we're all sitting on this Ponzi scheme that we all know to be a shit ton of old people at the top and not enough young people at the bottom, and we are we're stumbling into an apocalypse where there's not enough young people at the bottom to pay uh for our social security. Um, we have to sort that out. There's a bit of me that thinks if we can take out the stigma of renting, if you own your own home while you are child raising, and then you do liquidate the house, early 60s, free up that housing stock for more families, and then you take that rental income and you pay for your own death, your own care, your own retirement, instead of just expecting the estate to kick in every time you get dementia. I think that's the right way to do it. So there's a bit of me that feels like the rental model will play out in the end, and it will be, we will be at more than 50% of us are renting in our later lives because it's the only way to pay for your debt. It's the only way to cover your dementia costs. You there's no point sitting in a million-pound house.

SPEAKER_02 20:53

Honor, can you share that stat about the numbers of empty beds in houses? Because I just think that that that's the catalyst to solve the housing crisis, I think.

SPEAKER_03 21:03

I think it will single-handedly solve the housing crisis. But uh, as we go to bed tonight, in the homes of the over 65, there are nine million bedrooms with nobody sleeping in them. And it breaks me that that is a reality when there are 300,000 people sofa surfing. It doesn't need to be like that. And to a certain extent, us in later living, we have to take responsibility for just how bloody tawdry we've been in our development, how we need to go faster, because if we could just give the oldies somewhere to move into, they would happily free up those family homes. And let my favourite waitress at Sarah House move into a family home instead of having, you know, having to live with her brother in law and the girls sharing a bedroom. I mean, there's so many problems to fix, aren't there? But I wish that I wish that somebody would think about that under occupation of the bedrooms.

SPEAKER_01 21:54

I think that's a great point. It's not really something that I think the real estate industry fully. Considers and it was great that at the operational real estate festival where I saw you on the stage, that gets us all out of our silos. You know, me being student housing consultancy, I also have BTR and co-living clients, but nothing necessarily in later living. And I think that is I think that is a serious opportunity to solve the housing crisis. It's just how do we get that mess out there?

SPEAKER_03 22:25

Or does everybody in property make more money out of the housing crisis? Like, is is it in our interests that there's there's there's a pressure cooker and you can whack up a build-to-rent unit and someone will pay you three grand a month? Like, is property actually motivated to fill those bedrooms? Because filling those bedrooms doesn't involve building a shit ton of new towers, does it?

SPEAKER_01 22:48

It takes them out of the rental market in that sense, but eventually would put them in later living. So there's that sort of 20-year generational lag time between them, you know, going through into that later living. And I I I know why you're cynical about that. And yes, you're right in terms of the lack of returns that you would see given that you know everybody is desperate to get BTR off the ground. I was in Leeds last week. There's a pipeline of 10,000 PBSA beds and 10,000 BTR bets, and it's the rents effectively start at about £1,000 a month for a studio. And realistically, I think the average is probably about £1,600 a month. So, yeah, there's a lot of people making quite a lot of money out of those sectors. Is it in their interests to, you know, get people renting later in life and release that stock back to the market? Probably not. And it would have to come from the government or institutional investors to take a stand and say, right, we're going to control all of this. We're going to put those rent controls in place. But we've seen what happens with that when you have rent controls put in place, the cranes just stop.

SPEAKER_03 23:58

Absolutely, we have. And and when you say cynical, I don't I actually am not sure that I agree that that is a position. I just wanted to suggest. And I don't want rent control because I mean I'm part of a stable uh where they have a problem asset that they have an 18 million pound investment north of the border, and I don't know what they're gonna do with it because no one's gonna fund them. I do think though that you know, you mentioned that institutional money, and I'm from a social impact fund. I think that those people do genuinely feel that the responsibility of that money. So I present every year to the pension funds who invest with Bridges Fund Management, and they're people for like Liverpool Council, Manchester Council, and they turn up and they ask Bridges more questions about how are you making the world a better place than they ask about their returns because they genuinely see the responsibility that they have with these billions of pound funds to move the dial on some of this stuff. So I do think I was just being slightly provocative before, I do think that the weight of the money is trying to fix this. I do think that they are uncomfortable with the fact that you have to share bedrooms.

SPEAKER_01 25:07

I don't know. I don't know if there is that will yet within real estate to have a look at the number of Article IX funds that you've got as minimal. I and actually I was speaking to an investor yesterday, I was speaking to three different investors yesterday in London, in and around St James's, and just saying to them, where are all the Article IX funds? Where are the funds that are focused on doing good first and giving returns second? And it's because the returns haven't been that easy to come by in PBSA or BTR uh BTR for the past sort of year or so. It's just it's you know, cost of capital, cost of development, etc., cost of operations, utilities. And and so I think everybody is back in that mindset of we need to see the returns again. So let's put you know, an Article 8 fund maybe would be better first and foremost.

SPEAKER_03 25:54

And didn't nobody think that social impact is the thing that drives operational efficiency? That it's not the cherry on top, it's the thing that delivers the returns. It's not a nice to have, it's fundamental to so I have sitting on my board, he turns up and he always asks me the question I don't know the answer to. He's like a sort of rogue element. I don't know. Some time ago, he was like, I'm not gonna invest in a business that doesn't pay living wage. So at the time we were paying something like $11.95 an hour, and we had to go to £13.5 an hour. Thanks, Phil. Like you've just tanked my e-bit doll. But the crazy result in staff retention, I mean it just went through the roof. He knew that that was going to be the impact. It wasn't because he just wanted to be nice and shiny, it's because he didn't he he wanted those girls to work for us for three years before we then promoted them. You know, it's really, I just think that those funds who want the returns need to understand that impact is about returns, it's the way to get the returns.

SPEAKER_01 26:56

I think I think we're a way off in PBSA and BTR in particular. I think we're a way off of understanding a green premium for any kind of ESG measures on sale or exit or acquisition, uh, or the understanding of the operational benefits of doing the right thing. Now, I also run an ESG consultancy specializing in real estate. And I have clients that come to me and say, we just want to pay lip service to this, first and foremost. So just give us the bare minimum, and that's all that we want to do, and then just give us a nice story to talk about. And it's my job to then tell them exactly how they can do a good job. Well, so what I'm trying to do is educate them along the way. Like we know that not every client's going to come to us and say, we've written in these incredible uh ESG values into our company and we want to absolutely live those values, we want to do the right thing, and then if we make some money doing it, then great. Most of the clients that we tend to see come to us with that alternative approach, saying, we don't really understand ESG, we need a bit of help, and you know, can you just get us to that kind of base level? And then we can help them innovate, we can help them pioneer, and then all of a sudden, two years down the line, they suddenly realise, well, we're leading the sector here. I think there's still a fundamental misunderstanding of ESG and of what that means to real estate, but also on how it can generate exceptional returns now, because it can, you can get better uh lending terms as well, and you can also run at a better operation, but operational cost.

SPEAKER_03 28:28

The people who are listening to this will need to be told that three days ago was like the hottest day in the millennium, and I went to meet the chief exec of Dagenham and Barking, who then insisted on taking me on a 90-minute walking tour of Dagenham and Barking with sweat pouring down my back, and he wanted to show me I'm just never going to get there, I can't do passive house. And he said, Oh, there's now listening passive house light. He said that building over there, I appointed it 54 units. He said it cost 8% more to build, and he said in January the heating and electricity bill for that whole block was £17. I mean, that it blows your mind, doesn't it? It would be £17 for £54 units in heating electricity, and it costs 8% more to build on passive house light. And I don't think passive house light is actually a thing that we're supposed to talk about, but it's for me as a rental model. Maybe this is it, Dan. Maybe the for sales guys don't have to innovate because they sell that unit and bugger off. But us rental guys to run a building for 17 quid, I'm like, yeah, I'm gonna put some extra money in my construction. So now I'm like, shit, how do I do passive house light? That is social impact delivering epic Evid DAR, isn't it?

SPEAKER_02 29:39

But is the ESG thing actually potentially where you might see more people going into rental? Because the houses that these older people are living in right now, if they hold on to them, we know that from a maintenance point of view they're going to deteriorate. And not only that, but if they want to rent them out individually, we know now that the Labour government are putting you know EPCs back on back on track. But also, I imagine at some point to even sell a property, there will be a green premium. You know, it might be 15 years, it might be 20 years, but you know, people aren't going to be by you know boilers, you know, having gas boilers. You know, if all of these old houses have that, how are they gonna be able to sell those houses? So I think from listening to other interviews that you've done, uh Honor and kind of my understanding of it is you you want people to free up those houses before they've run those houses into the ground. And those people won't be able to sell them in the future if they haven't maintained them and if they haven't insulated them and if they haven't changed the boilers.

SPEAKER_03 30:45

I think so. I don't know how to track this. I'm I'm really one day I hope that an amazing postgrad will get in touch and say, I know how to track this honour, but I genuinely believe that the people who move in with us have typically lived in that family home for 33 years and they do have a gas boiler and they've got nothing, no insulation in the roof, and all the but the family that buys that home then invests in it and makes and brings it up to an EPCA and all the gas is taken out. So as so I get this like serotonin hit. Is it serotonin? Every time someone moves in and I think, oh, 2.3 bedrooms, now got someone sleeping in it. That house is now more sustainable because someone's going to invest in it, the house that you've just left. And your daughter, who spent her whole bloody life being your carer, not her whole life, the last five years being your carer, is now free to go back to work and be an economically productive female again. So I'm like, oh my god, all these benefits. If I could just get you to move to us. We have this thing the other day, this amazing old duffer fell in front of me. And normally we would have to call the NHS and they'd say, Okay, it's going to be about six hours, because it's not an emergency, but it was on the floor. So then a member of my staff would lie next to him under a blanket, both had their head on pillows, and she'd sing songs to him, and you know, they'd pluck and play ice by whatever it takes to get through six hours lying on the floor. And we had this amazing blow-up chair like a Lilo. You kind of squidge it underneath him, and then you blow him up, and in four and a half minutes he goes to standing. And I was like, Oh, now we don't even have to call the NHS. Like, literally, we need nothing now. We're this amazing, self-contained, self-sustaining community. Just let us have a few more of them, and then all these amazing benefits will trickle out, but we've just got to go a bit faster.

SPEAKER_02 32:30

But you're you're right. We were talking before we we hit hit record, you know, that I've just had a you know a few days away with with my dad by the south coast, and he would have loved to have lived here and left it too late. You know, when he you know he had an elderly mother back in London where we we lived, then me and my brother, you know, we were teenagers and blah blah blah. And life went on and he didn't get to move to the seaside, and he would have loved it. And it makes me so sad, but I can see that cycle repeating because I'm sat here by you know by the seaside thinking, oh my god, I just want to live by by by the beach. But you know, my youngest is is 12, you know. I don't know how a lot, you know, when will he move out of home? And I can just see that cycle, you know, repeating, and you can see how how it happens. And you know, if there's anything I've learned from listening to to you and others of the sector, it's you want uh old people to live the life that they should live without the uh the the chain around their neck of this big house that needs lots of stuff and lots of maintenance because they want to leave their children inheritance, and that's really I think for a lot of it all they want, and they they don't want to end up with loads of money that they're gonna just have to plow into social care, and it's it is there's so many cycles that rental later living can solve really. So we just have to keep having conversations and you know, please don't go under the radar honor and think that you're being overexposed because you have to keep talking about this.

SPEAKER_03 34:08

Okay, so the marketeer in you, Sarah, what after six months we interview everybody who's moved in with us, and it's like a sort of health check, you know, did it live up to your expectations? And without fail, without fail, every one of them say, Oh, I wish I'd done it earlier. How do you bottle that I wish I'd done it earlier and market to that? Because that's the insight.

SPEAKER_01 34:27

It's marketing to the shoulda, woulda, coulda generation in that sense, like you know, and and I think I think later living is primed and ready, it's doing well now, but in in 20 years' time, maybe slightly less, there will be a massive boost in it because I think you know, I'm I'm 42. My generation I think is a lot softer. In and and that, you know, we're not a stoic, the British sort of stiff upper lip, just get on with things. I think we will need to be mollycoddled and looked after. But I think we'll want to try and do it on our own terms. And by looked after, I don't mean going to care homes. I think we're going to want those inclusive communities that kind of bring us out of our shells. We saw how dangerous that was during COVID, that everybody was stuck inside. And I think that's where that sense of community is really important, especially as you get into later life. We also know how loneliness has such a huge impact on that as well. I think some of it is going to come down to a mindset shift, which will happen over time, and some of it, you know, over renting and over what the options are, and really clearly displaying those options. And people like you are the perfect, you know, you're you're the perfect poster woman for it because of the fact that definitely just because you're very articulate, you're able to really openly talk to them on their level, uh, you know, you're happy to swear like a trooper, and I think that talks to people on their level rather than it, you know, like I said, just being that sort of corporate shill, effectively. And I think we've got to we've got to make sure that the brands are super appealing and that we're taking down any barriers to entry that people might feel. Older people are getting much better with their internet literacy, effectively. But how do you then show what we see in student housing, for example, where we have marketplaces that will compare and contrast all of the options for PBSA. Every PBSA seems to be branded differently, they have different values and different points of uh points of attraction. And I see it in Birchgrove, and you can see it in any of your competitors as well. I do think that the branding is going to be absolutely key. I'm sure Sarah will come onto this shortly, but but also those routes to markets. So the marketplaces. One thing that I did a bit of research obviously before this shock horror, I do actually research, but I found Lotie, I think it was Lotti.org, and that they're obviously comparing and contrasting later living options. And I think the more that we can see things like that, services like that, and that you know, fully understand that the the channels that people are using to look at later living and educate them better, I think that's where that mindset shift will happen a lot quicker. So the more that you can do by getting on stage, by you know doing podcasts or explaining exactly what it is, the better. That's the way I see it anyway.

SPEAKER_03 37:16

I do have to say, if it takes 20 years, as you predict, I'm gonna shoot myself because we it needs to be faster. Like like we have to nail this in the next five years.

SPEAKER_01 37:25

We have to get this you know, I'm probably thinking about my age and the fact that when I'm 62 in 20 years' time, I will I will probably be well, maybe I will be, yeah, I'll probably be thinking about what are my next No, you won't, Dan.

SPEAKER_03 37:37

You're still at work. You're still at work at 62. You need to be at work. Like, this is not about being 62. You're still at work, you've still got your kids. What are we gonna say, Sarah?

SPEAKER_01 37:47

But but still, uh, it's I think I think yeah, you're right. It does need to happen now. That mindset shift does need to happen. So, okay, how do we do that? How do we make that shift?

SPEAKER_03 37:58

The cut the customer's doing it down. So the customer is doing that. So, like, we either evolve or we get left behind. So the so uh in the birch grove cohort at the moment, 85% of my residents are the silent generation, which is the kids, babies born in the war, who uh say thank you and please and I don't want to bother you, and if they fall on the floor, they won't press the pebble because we they think we're too busy. Uh and they're a really easy, they're an easy customer, they're very rewarding to be with, they're lovely. And 15% of our customers are the baby boomers who like the other day, one of them was like, I can't believe you don't have a cheese board. I was like, I know, I'm really sorry, Brian. I don't have a cheese board, I just couldn't believe it. So they and that oldest baby boomer has turned 80 this year, so we have to evolve or die because the boomer will not accept a care home. And they're they are this force of nature, and there's a shit ton of them.

SPEAKER_02 38:53

And that's But I think you need to get your your your residents to to speak out more and shine a light on them, and all of those amazing reviews that you have after you know six months of people living there and how happy they are and how they wish they'd done it earlier. They need to tell more people, and that's what the marketing you know should should say, really. You know, to take away that fear. We you know, we started the podcast talking about the fear of rentals, and surely they are the poster people for saying we it's not scary, it's bloody amazing. Look at the life that we're we're living, and we wish we'd done it earlier. And you know, do you need to market to uh the 80-year-olds? Probably probably not. You probably need to mark to uh the 60-year-olds or uh the 42-year-olds like Dan and I, who will be influencing our parents. Like, oh my god, have you heard about this thing? Because you know, actually, or you know, I want to move into your house with my family, and can you please move out? And it doesn't mean that you have to sell that home, you know, that we'll we'll rent it from you and you can go and rent somewhere amazing, and maybe you can live in a city. I was just thinking before when Dan was talking about PBSA and BTR in uh Leeds, is uh you know, is uh later living rentals in cities uh the next stage as well? Because if all those people are experiencing city centre rental living and they've loved it, why would they they move out really? Because you've got you know, I you know, I know you know yours are in really vibrant, vibrant communities. You're not putting people out in the sticks, you know, you want them to be part of the community.

SPEAKER_03 40:30

In the same way that the three of us are quite different now, we will be that different when we're over 75. And so you actually want to go and live by the sea. I want to live on Marleyburn High Street, and I don't know where Dan wants to live. So we need to build something for all three of us. Just because we're over 75 doesn't mean we all homogenize and come together. So that is one thing that the sector needs. With the impetus and the innovation needs to come choice and diversity because we all want different things. And and that's what care homes I think didn't do. A care home kind of looks like a care home, it's a bit more expensive or it's a bit cheaper, and that seems to be defined about whether you've got jellyfish in the reception. Doesn't seem to be not much else changed in care homes.

SPEAKER_02 41:11

Whereas we need to we need to do diversity of tenure and I mean Honor, we could carry on talking about this for ages, and we haven't really touched the surface, I don't think. And I know you know Deanny will be kicking herself that she's not part of this conversation, but she can listen like everybody else. So I think we'll have to wrap it up now. But you know, I'm sure we'll all see you on the circuit of various different conferences, and please, please keep talking up about this because you know a lot of the people who are listening, like us, probably have parents that would love to live in a later living rental community but might not know about it. So, you know, I hope that this conversation kind of inspires further conversation and collaboration.

SPEAKER_03 41:54

I think this conversation was like supercharged because you were both prepared to bring your personal experiences with your parents and your grandparents to play because that's exactly where all of us are. That's that's exactly what we're trying to fix, isn't it? So thank you for bringing those stories.

SPEAKER_02 42:08

No problem. Um a huge thank you to Ona for joining us today. Clearly, very busy and changing the world. So thank you for sharing all your wise words with us, and it's very generous of you. Please make sure you're following the Birch Grove story and Honor on LinkedIn as the sector can learn so much about innovation and challenging what's been done before. Thank you to you all for listening as well. We look forward to bringing you another episode of House very soon.