Manchester BTR Survives Its Baptism Of Fire, But The Heat May Not Be Over

Manchester’s build-to-rent apartment sector seems to be surviving its coronavirus baptism of fire. 

An unnamed corporate occupier has signed pre-lets for 25% of the final phase of BTR apartments at Moda Living’s 35-storey Angel Gardens development in central Manchester.

Moda said 50 of the 200 available apartments have been pre-let to the occupier. The entire scheme is 466 units.

“Corporate occupier interest in Manchester BTR has been a bit hit and miss,” Knight Frank Manchester partner Dan Searle said. “Some want an entire block, so they have control. Letting floor by floor is second best from a management point of view, but we’re seeing more corporate interest in BTR lettings as those businesses look more to the long term.”

With the corporate letting and 33 further lettings during April and May, and more than 200 people on the waiting list to reserve tower apartments in the final phase of Angel Gardens when lettings go live later this month, Moda is full of optimism.

Moda reported 98% of Angel Gardens' rents were collected either at estimated rental values or market premiums during lockdown, suggesting the resilience of BTR as an asset class.

“It is a lively market compared to the office sector, and demand is there because people still need somewhere to live and want to be in the city centre, but you look at the unemployment figures and potential future unemployment, and maybe some potential tenants may not appreciate what is round the corner on their jobs or the economy,” Searle said.

With some developers unable to show flexibility on rents, the speed of letting may slow, although Searle is convinced all BTR apartments will let eventually.

Moda opened Phase 1 of its 530K SF Angel Gardens in October 2019, with practical completion of the final phase occurring this month.