Four critical brand considerations for Australian build-to-rent developers
RoundFour critical brand considerations for Australian build-to-rent developers
Although a relatively new proposition for Australia, the global build-to-rent market has been emerging for more than a decade.
21.11.2023
Cities like London and New York have established the build-to-rent model, in which developers build and lease property to tenants directly, and shown its viability at scale. Now, major Australian cities facing housing-availability and affordability crises are looking at build-to-rent as a potential solution (or part thereof). Locally, the sector is valued at almost $17 billion – with the majority of developers operating in Melbourne, a city predicted to house 30,000 build-to-rent homes by 2030.
Still, home ownership has long been a cornerstone of Australia’s cultural identity (we have a whole film about it). Positioning a build-to-rent brand to consumers involves unique considerations – and developers who are familiar with the traditional build-to-sell model shouldn’t assume this will automatically translate to success in the build-to-rent market.
Here, we’ve collated a handful of though-starters for brands looking to enter the space – based on findings from our experience working with leaders in the sector.
1. Operators need to think like hoteliers
A key consideration for developers used to operating in the build-to-sell market is the fluid nature of the rental cycle.
Whereas traditional developers have a defined period in which their marketing occurs, build-to-rent operators will always need to generate leads to replace outgoing tenants and, as such, will require an always-on marketing approach to match.
This consideration can influence many decisions, from ensuring you create evergreen imagery and considered re-engagement strategies, to appropriately allocating marketing budgets.
In this sense, operators are best served by benchmarking against the hotel and accommodation services industry – rather than real estate and development brands.
Holistic control of properties also allows operators to offer amenities and services traditionally associated with hotels.
Compared with typical residential offerings, this is a key area where build-to-rent operators can set themselves apart. Thoughtful amenities and premium services can entice consumers frustrated with the current state of the market and create a compelling point of difference.
21.11.2023
Cities like London and New York have established the build-to-rent model, in which developers build and lease property to tenants directly, and shown its viability at scale. Now, major Australian cities facing housing-availability and affordability crises are looking at build-to-rent as a potential solution (or part thereof). Locally, the sector is valued at almost $17 billion – with the majority of developers operating in Melbourne, a city predicted to house 30,000 build-to-rent homes by 2030.
Still, home ownership has long been a cornerstone of Australia’s cultural identity (we have a whole film about it). Positioning a build-to-rent brand to consumers involves unique considerations – and developers who are familiar with the traditional build-to-sell model shouldn’t assume this will automatically translate to success in the build-to-rent market.
Here, we’ve collated a handful of though-starters for brands looking to enter the space – based on findings from our experience working with leaders in the sector.
1. Operators need to think like hoteliers
A key consideration for developers used to operating in the build-to-sell market is the fluid nature of the rental cycle.
Whereas traditional developers have a defined period in which their marketing occurs, build-to-rent operators will always need to generate leads to replace outgoing tenants and, as such, will require an always-on marketing approach to match.
This consideration can influence many decisions, from ensuring you create evergreen imagery and considered re-engagement strategies, to appropriately allocating marketing budgets.
In this sense, operators are best served by benchmarking against the hotel and accommodation services industry – rather than real estate and development brands.
Holistic control of properties also allows operators to offer amenities and services traditionally associated with hotels.
Compared with typical residential offerings, this is a key area where build-to-rent operators can set themselves apart. Thoughtful amenities and premium services can entice consumers frustrated with the current state of the market and create a compelling point of difference.
2. Brand equity is essential for ongoing success
Residents won’t just be considering you – and, by extension, your brand – as a developer but also as their potential landlord. This requires a high level of brand trust you must build over time through considered communications, touchpoints and experiences.
A defined place philosophy is key to ensuring your potential residents experience your brand coherently and consistently. This piece of work should articulate how your brand will address users’ needs and should to be grounded in a sophisticated and thorough understanding of your prospective customers. Accurate profiling allows you to better identify gaps in your offer – beyond just creating apartments for people to live in.
If done effectively, there’s a huge opportunity for developers to build engaged communities of renters who will not only drive tenant retention – but can also be leveraged as a leasing conversion tool through user-generated content, testimonials and other strategies.
2. Brand equity is essential for ongoing success
Residents won’t just be considering you – and, by extension, your brand – as a developer but also as their potential landlord. This requires a high level of brand trust you must build over time through considered communications, touchpoints and experiences.
A defined place philosophy is key to ensuring your potential residents experience your brand coherently and consistently. This piece of work should articulate how your brand will address users’ needs and should to be grounded in a sophisticated and thorough understanding of your prospective customers. Accurate profiling allows you to better identify gaps in your offer – beyond just creating apartments for people to live in.
If done effectively, there’s a huge opportunity for developers to build engaged communities of renters who will not only drive tenant retention – but can also be leveraged as a leasing conversion tool through user-generated content, testimonials and other strategies.
3. You need to keep pace with the market
Unlike property purchases, which generally unfold over a considerable timeline, immediate availability is a key driver for renters – alongside location and price. As of December 2022, the average rental property listed on realeastate.com.au was on the market for just 18 days.
In contrast with traditional property brands, where long-forecast sales campaigns are key to driving leads, build-to-rent operators are better served by launching their brands when properties are available for move-in (or close to it) to minimise missed opportunities and drive the highest ROI for campaign dollars spent.
Your consumer looking for a rental property today may well be out of the market the following month, and they’re unlikely to re-engage with you in the short term.
As a result, your leasing team will require a steady stream of new leads – and they need to be motivated, agile and well-informed about your offer to ensure they make the most of them.
This level of consideration needs to be applied to your other brand touchpoints, too. As build-to-rent is still an emerging category within Australia, your brand tools will need to play an informative role in educating your audience. How will your website facilitate tour bookings and what will this look like? What’s the eDM journey for prospective residents? Do you have video walk-throughs and floorplans available to your audience? How will your social channels support the brand?
These are just some of the questions you should be able to answer confidently before going to market.
3. You need to keep pace with the market
Unlike property purchases, which generally unfold over a considerable timeline, immediate availability is a key driver for renters – alongside location and price. As of December 2022, the average rental property listed on realeastate.com.au was on the market for just 18 days.
In contrast with traditional property brands, where long-forecast sales campaigns are key to driving leads, build-to-rent operators are better served by launching their brands when properties are available for move-in (or close to it) to minimise missed opportunities and drive the highest ROI for campaign dollars spent.
Your consumer looking for a rental property today may well be out of the market the following month, and they’re unlikely to re-engage with you in the short term.
As a result, your leasing team will require a steady stream of new leads – and they need to be motivated, agile and well-informed about your offer to ensure they make the most of them.
This level of consideration needs to be applied to your other brand touchpoints, too. As build-to-rent is still an emerging category within Australia, your brand tools will need to play an informative role in educating your audience. How will your website facilitate tour bookings and what will this look like? What’s the eDM journey for prospective residents? Do you have video walk-throughs and floorplans available to your audience? How will your social channels support the brand?
These are just some of the questions you should be able to answer confidently before going to market.
4. Tours are ownable brand moments
Late. Overcrowded. Inconvenient. Inspections are a significant pain point for renters across Australia and, as a result, offer a compelling chance to redefine the experience and positively differentiate yourself from the traditional market.
This is a chance to set the tone for the entire brand – and make a compelling case for the build-to-rent category.
Be everything a traditional inspection fails to be. Offer tours at various times of the day that are flexible enough to accommodate the needs of your tenants – and ensure you personalise the experience as much as possible.
Given you can control the environment, consider the pre- and post-tour experience. Where will prospective tenants enter the building? How will they be greeted? How will you qualify their familiarity with the build-to-rent sector? And how will you ensure they remember you after they’ve left?
If you can clearly articulate answers to these questions, you’ll already be at a considerable advantage compared with traditional operators.
This is by no means an exhaustive list of considerations when establishing a successful build-to-rent brand, but rather an introduction to types of considerations relevant to developers – no matter their existing build-to-sell experience.
4. Tours are ownable brand moments
Late. Overcrowded. Inconvenient. Inspections are a significant pain point for renters across Australia and, as a result, offer a compelling chance to redefine the experience and positively differentiate yourself from the traditional market.
This is a chance to set the tone for the entire brand – and make a compelling case for the build-to-rent category.
Be everything a traditional inspection fails to be. Offer tours at various times of the day that are flexible enough to accommodate the needs of your tenants – and ensure you personalise the experience as much as possible.
Given you can control the environment, consider the pre- and post-tour experience. Where will prospective tenants enter the building? How will they be greeted? How will you qualify their familiarity with the build-to-rent sector? And how will you ensure they remember you after they’ve left?
If you can clearly articulate answers to these questions, you’ll already be at a considerable advantage compared with traditional operators.
This is by no means an exhaustive list of considerations when establishing a successful build-to-rent brand, but rather an introduction to types of considerations relevant to developers – no matter their existing build-to-sell experience.