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Residential property in the UK has never seemed a more attractive investment. With a shortage of quality rental properties available and development struggling to keep up with demand, there is tremendous competition for the right assets. Nevertheless, there are opportunities available, and the returns on a good, well-managed scheme can be attractive - particularly to commercial clients looking for long-term income generating investments.

At CMS, our lawyers have worked in the residential sector for over 20 years. We are also one of the few law firms with representation on the BPF’s Residential Committee. This track record gives us a real understanding of the market. We act as a sounding board for a wide range of commercial clients, offering pragmatic advice and solutions to help them navigate the complex issues, regulation and taxes peculiar to the private residential sector.

We regularly advise commercial clients on issues relating to forward funding/forward purchasing on a leased or direct-let basis, development and property funding.

The right tax advice is essential in the PRS, given the complexities around VAT (particularly in relation to forward funding) and we have a dedicated real estate tax team which covers the whole of the UK. We also have resource in areas such as data protection, employment and eviction, and are able to offer commercial clients advice in relation to investment, acquisition and forward funding, joint ventures, asset management and disposal.

We have carried out some of the largest PRS transactions in recent years, acting for a number of significant commercial players in the market. For example, we acted on behalf of RBS in the sale of their GBP 210m residential portfolio to the US private equity firm, Apollo. The transaction involved the sale of some 1650 PRS units and 150 ground rent units, with 163 assets from individual flats and houses, to groups of flats and houses ranging to blocks with up to 160 flats across Scotland, England and Wales, making it one of the largest PRS transactions ever to take place in the UK. We also advised Aberdeen Asset Management’s Aberdeen Property Trust on one of the largest ever single purchases of existing stock in the PRS in the UK – the GBP 60m acquisition of 180 Stratford High Street.

High­lights of our Ex­per­i­ence in PRS in the UK
The Wellcome Trust on the man­age­ment of the South Kens­ing­ton Es­tate, a large res­id­en­tial es­tate com­pris­ing thou­sands of res­id­en­tial ten­an­cies. GI Part­ners on the form­a­tion of its joint ven­ture with...
Law-Now: Real Es­tate
Vis­it Law-Now for leg­al know-how and com­ment­ary

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19/07/2021
MA­JOR IN­DUSTRY SUR­VEY RE­VEALS STARK CON­SEQUENCES OF REAL ES­TATE’S £6 BIL­LION...
In­dustry lead­ers be­lieve pen­sion funds will take a hit as a res­ult of the con­tin­ued ex­ten­sion of the morator­i­um on un­paid rent, which won’t sup­port ten­ant re­cov­ery in the long term  The de­cision by...
19/07/2021
Ma­jor in­dustry sur­vey re­veals ex­tent to which tech­no­logy is re­volu­tion­ising...
Over 4,000 glob­al in­dustry lead­ers, of­fice oc­cu­pi­ers, renters, re­tail de­cision makers and life sci­ences pro­fes­sion­als con­sul­ted in biggest in­dustry sur­vey of its kind to un­pack how, where and why tech­no­logy...
15/07/2021
Tech drives push to­wards net zero
Real es­tate pro­fes­sion­als have had a dra­mat­ic con­ver­sion in the last 12 months to­wards the prin­ciple of achiev­ing net zero, ac­cord­ing to our polling.While the concept was barely un­der­stood two years ago – and in­dustry ex­perts were taken aback by ini­tial glob­al am­bi­tions to achieve net zero by 2040 or 2050, the real es­tate sec­tor has been gal­van­ised in­to ac­tion by its in­vestors and oc­cu­pi­ers and is now look­ing to hit its tar­gets by 2030-2035. Tech­no­logy has to be at the heart of this: stake­hold­ers from across the real es­tate world now have the mo­tiv­a­tion, fin­an­cially and eth­ic­ally, to cre­ate and util­ise tech­no­logy that can help cre­ate green­er build­ings.In the last year the biggest play­ers in UK real es­tate, in­clud­ing Aviva In­vestors, Brit­ish Land, Land­sec and SE­GRO, have set bold tar­gets to reach net zero, with most re­spond­ents ex­pect­ing the real es­tate world to beat gov­ern­ment tar­gets by achiev­ing net zero emis­sions by 2035 at the latest.
15/07/2021
Real es­tate cata­pults ahead
The dawn of pr­op­tech was 1980-2000 and saw the rise of soft­ware tools that made as­set man­age­ment easi­er. Pr­op­tech 2.0 was 2000-2015 with the rise of the likes of Zo­opla and Airb­nb help­ing the con­sumer, in par­tic­u­lar, to re-think their re­la­tion­ship with real es­tate. We are now at the dawn of Pr­op­tech 3.0, driv­en by con­cepts such as AI, ro­bot­ics, 5G, 3D print­ing and the In­ter­net of Things, (IoT) which will cre­ate the biggest changes of all and will in­crease the speed of change after the seis­mic up­heav­al of COV­ID-19. Many people see this as a fourth in­dus­tri­al re­volu­tion, rep­res­ent­ing a fun­da­ment­al change in the way we live – a new chapter in hu­man de­vel­op­ment en­abled by ex­traordin­ary tech­no­lo­gic­al ad­vances com­men­sur­ate with the first, second and third in­dus­tri­al re­volu­tions. The im­pact on the built en­vir­on­ment dur­ing the 2020s will be pro­found.
15/07/2021
A tech-driv­en trans­form­a­tion
The in­creas­ing im­port­ance of tech­no­logy and di­git­al­isa­tion has come to the fore through­out the COV­ID-19 pan­dem­ic, par­tic­u­larly in the of­fice mar­ket but also in life sci­ences, build to rent and lo­gist­ics.
15/07/2021
A re­volu­tion on all fronts
There is a grow­ing con­sensus that the next gen­er­a­tion of real es­tate tech­no­logy will bring un­pre­ced­en­ted change to the in­dustry, with the key trends pre­dicted by in­dustry com­ment­at­ors as fol­lows:As the new hy­brid world dawns it is seen as in­creas­ingly im­port­ant that ac­cess to the of­fice (in par­tic­u­lar) be as con­veni­ent and stress-free as pos­sible.Liv­ing and life­style are also now con­sidered a fer­tile world for tech­no­logy – but only in new de­vel­op­ments.COV­ID-19 has ac­cel­er­ated e-com­merce across Europe, with e-com­merce in the United King­dom rock­et­ing.Big data is set to un­der­pin the whole re­volu­tion.Tech­no­logy is also seen as key to fa­cil­it­at­ing great­er sus­tain­ab­il­ity, with sensors, data and the best meas­ure­ment cru­cial to en­han­cing ESG cre­den­tials, par­tic­u­larly in the chal­len­ging arena of ret­ro­fit­ting.However, it is also re­cog­nised that bar­ri­ers re­main to the wide­spread ad­op­tion of tech­no­logy, with big data in par­tic­u­lar eyed with sus­pi­cion by ten­ants and cus­tom­ers. Three in four of those we polled said they were wary of the Re­turn on In­vest­ment on smart tech­no­logy. Com­pan­ies har­vest­ing this data are viewed with dis­trust – with the Daily Tele­graph among the first or­gan­isa­tions to re­con­sider and then with­draw devices to mon­it­or wheth­er people are at their desk.Our re­search across a range of fields, from the real es­tate in­dustry, among of­fice oc­cu­pi­ers, renters and po­ten­tial renters, re­tail ex­perts and life sci­ences pro­fes­sion­als, drew a strik­ing re­sponse.
15/07/2021
Real es­tate bounces back
Re­cov­ery of the real es­tate mar­ket is well un­der way, with op­tim­ism rising and a vac­cine-promp­ted bounce pro­pelled fur­ther by two power­ful forces driv­ing the sec­tor’s fu­ture: tech­no­logy and ESG.
15/07/2021
Where tech ad­op­tion and COV­ID col­lide
We asked the real es­tate sec­tor of­fice oc­cu­pi­ers, renters, re­tail­ers and life sci­ences busi­nesses what im­pact COV­ID-19 is hav­ing on de­mand for real es­tate in their area, and also on ad­op­tion of in­nov­at­ive tech­no­logy.The sweet spot for in­nov­a­tion and de­mand driv­en by COV­ID-19 is life sci­ences, where both the oc­cu­pi­ers and the real es­tate pro­fes­sion­als see equally pos­it­ive op­por­tun­it­ies. Driv­en by spec­tac­u­lar tech­no­lo­gic­al break­throughs like COV­ID vac­cine de­vel­op­ment, and with pub­lic and private sec­tor fund­ing pour­ing in­to the sec­tor, life sci­ences is an as­set class in the up­per right quad­rant, very much em­bra­cing the op­por­tun­ity.By con­trast, in-store re­tail is `stuck in the head­lights’ ac­cord­ing to our polling – be­set by fall­ing de­mand caused by lock­downs and less likely to have ad­op­ted in­nov­at­ive tech­no­logy as a res­ult of COV­ID. In­ter­est­ingly, real es­tate pro­fes­sion­als are sig­ni­fic­antly more pess­im­ist­ic about real es­tate de­mand from the sec­tor, than re­tail­ers them­selves. This may be a re­flec­tion of in­creased de­mand for lo­gist­ics space as a res­ult of the ac­cel­er­ated shift to on­line shop­ping.While real es­tate pro­fes­sion­als see of­fices as the most act­ively in­nov­at­ing in re­sponse to the pan­dem­ic, oc­cu­pi­ers are less con­vinced, al­though they also seem less pess­im­ist­ic about de­mand for of­fice space. This per­haps re­flects the real­ity of a blen­ded work­ing ap­proach which looks here to stay in the im­me­di­ate fu­ture.The build to rent sec­tor, by con­trast, is seen as `lucky’ by renters who see that de­mand is strong but do not be­lieve they are see­ing enough in­nov­a­tion in the light of COV­ID-19 rather than re­devel­op­ing tired prop­er­ties.
15/07/2021
Pan­dem­ic spurs ac­cel­er­ated trans­form­a­tion
Many people have spec­u­lated over how quickly COV­ID-19 has ac­cel­er­ated tech­no­lo­gic­al ad­op­tion with­in real es­tate – but now we have a view from more than 4,000 in­dustry pro­fes­sion­als, of­fice oc­cu­pi­ers, renters, re­tail ex­perts and life sci­ences pro­fes­sion­als: five years.Across all groups this is the most com­mon pre­dic­tion al­though the mean re­sponse is four years. The im­pact of lock­downs and the need to rap­idly em­brace tech­no­logy is ex­traordin­ary: how many people used Teams or Zoom for busi­ness 18 months ago?
15/07/2021
Ro­bot world and the roar­ing 20s
Ar­ti­fi­cial in­tel­li­gence (AI) and ma­chine learn­ing, 5G IoT, vir­tu­al/aug­men­ted real­ity and ro­bot­ics are con­sidered the com­ing forces among real es­tate cus­tom­ers, which be­gins to ex­plain how tech­no­logy is ex­pec­ted to ac­cel­er­ate change in the sec­tor dur­ing the 2020s.These are pro­found changes which will not only im­pact how key in­dus­tries are man­aged but also how they oc­cupy real es­tate – and who oc­cu­pies real es­tate on their be­half. In­ter­est­ingly no one tech­no­logy scores over 50%, sug­gest­ing views are di­vided on which in­nov­a­tions will have the most im­pact on the real es­tate over­all.Tools such as Amazon’s Al­exa have re­moved the mys­tique from AI as people have real­ised that it can make their lives easi­er, and it is per­haps not sur­pris­ing to note that the highest ac­cept­ance of this tech­no­logy is in ar­gu­ably the most tech-ad­vanced sec­tor – life sci­ences.
15/07/2021
Real es­tate em­braces data – at last
Real es­tate as­set man­age­ment is now data-rich, hav­ing for many years re­lied on a dis­par­ate set of met­rics and a haphaz­ard ap­proach to meas­ure­ment.Giv­en the value of most prop­er­ties, this is sur­pris­ing, be­cause mar­gin­al gains can make a huge dif­fer­ence, par­tic­u­larly across a large port­fo­lio if this level of dis­cip­line is re­peated.It is no sur­prise, there­fore, that data col­lec­tion is seen as a key tool as own­ers battle to meet tough sus­tain­ab­il­ity tar­gets.At the same time, oc­cu­pi­ers are also see­ing the be­ne­fits of data col­lec­tion, par­tic­u­larly around the op­tim­al use of space. Yet again, the life sci­ences world is at the cut­ting edge of this think­ing.
15/07/2021
’Smart’ leap for build to rent
For land­lords smart build­ings will de­liv­er high­er rents, for ten­ants tech­no­logy will be an in­creas­ingly im­port­ant en­a­bler for the work from home re­volu­tion, and for both in­nov­a­tion will help sup­port a more sus­tain­able fu­ture.