Managing all those tenants, fixing all those leaks, servicing all those lifts – why bother with that when you could own a prime office building with a couple of blue-chip tenants and leave the maintenance to them? Or shopping centres, or sheds, or car parks? Whatever, but never residential.

Which of course was strange, because almost everywhere else in the world, residential formed a significant part of most institutional property portfolios.

Then along came the 2007 crash, when the banks withdrew all funding for speculative residential developments. This was a strange strategy because there was a massive supply-demand imbalance in the residential market and any disruption in the supply chain would just make matters worse. And most people still had jobs and a decent income.

One of the few good things to come out of the 2008 financial crisis has been the build-to-rent (BTR) sector. Various operators saw that the UK property market was changing as first-time buyers faced an unsustainable wall of debt in order to secure the deeds to their first home. It was time to introduce a new product to the UK market.

The first operators appeared in 2012 and now have a solid eight years of experience in a residential market heavily slanted in favour of build-to-sell. The sales market has Help to Buy and record low interest rates, while BTR operators pay double SDLT, annual licence fees and full council tax on empty flats. Despite these hurdles, the sector is thriving.

In March 2020, the UK went into lockdown. Unprecedented, unplanned and, for many, a financial disaster. Traditional property investments were hit hard.

Post-lockdown, office tenants will be looking to reduce floorspace as they steer their workforce to more flexible working patterns. Landlords must expect vacancy rates to climb as planned lease extensions are renegotiated.

Retail, hospitality and leisure investments have all suffered catastrophic reductions in income, leading to CVAs or total business closure. At the very least, tenants are looking to renegotiate leases to introduce turnover rents.

Sheds have done well, riding on the back of the thriving online sales market as homebound shoppers rely on Amazon, Ocado and eBay.

But at the top of the list is the BTR sector. A recent BPF survey logged rent collection in May and June by 21 BTR operators at more than 80% of rent demanded, with 50% of those above 95%.

The average institutional BTR investment would contain a minimum of 100 apartments, housing more than 200 tenants. Each tenant is jointly responsible for the rent on their apartment, spreading the risk a long way.

Furthermore, a responsible landlord will have carried out thorough financial referencing checks on each tenant and ensured they are earning at least three times the rent. As a result of this due diligence, Fizzy Living has navigated the pandemic at 98% occupancy and 97% of rent collected.

Added to that has been the positive tenant reviews across the sector as reported by HomeViews. This is particularly the case in assets owned by institutions where there is a recognised professional management platform with onsite staff, who have continued to manage the day-to-day operation of their buildings while employing social distancing measures.

BTR has matured into a popular, safe and flexible product, with proven resilience to the sort of market turbulence that has so seriously impacted other sectors. We expect a surge in investment activity as opportunities planned for sale are remodelled for long-term rental.