To coincide with his appearance at this year’s CN Summit, Construction News visited Quintain boss Angus Dodd at the developer’s Wembley Park scheme to hear how he plans to make a build-to-rent breakthrough.
It’s only when Quintain construction director Matt Voyce flips the switch and illuminates a giant model of Quintain’s Wembley Park project that Construction News truly gets a sense of its scale.
Although the giant arch and domed structure of the stadium dominates the landscape, the future developments lit up around it are so vast and complex they look like an entirely new city. The model also shows how, despite Wembley’s already significant transformation, there is much more to come.
Completed buildings do not light up, which shows how much more Quintain has yet to build. Developing at such scale presents a multitude of challenges, as Quintain chief executive Angus Dodd tells CN. “Development is hard work, it’s unbelievably complicated,” he says.
“You’re trying to do complex things subject to the weather, here we’re subject to the crowds, subject to 90,000 people coming [to Wembley station] 40 times a year.”
Mr Dodd tells CN that one of his key advisers has been Sir David Higgins, the man behind the 2012 Olympics and, until recently, HS2. “He compares this to the big Olympic sites,” Mr Dodd says.
“But the big Olympic sites were closed, no one was allowed in them. There was a timing deadline, but frankly there wasn’t really a budget limit. [The development] had to be ready for a date in summer 2012, so they were going to pay. Here we’ve got budget limits, it’s an open site, it’s as complicated as you can get.”
It’s unsurprising, considering the size of the project, that the developer’s focus is solely on its Wembley Park scheme, on which it has taken a hands-on approach.
A huge number of its staff are based on site and are visiting live projects daily to tackle issues as they arise.
“Quite a lot of developers I speak to say, ‘We’re developing up in Leeds and Edinburgh and Glasgow’. With your head of development […] sat in Mayfair, does that really work?” Mr Dodd asks. “It’s something I’d worry about if we suddenly went large-scale regional. Could we maintain the same level of control?”
That sense of control extends to its selection of framework contractors. In September 2017, Quintain made the bold step of choosing to hand a £130m contract to McAleer & Rushe – the largest job in its history – ahead of Carillion.
Quintain CEO Angus Dodd
“The Carillion decision looked brave at the time; it clearly looks like genius in retrospect,” the Quintain boss tells CN. “It’s one of those decisions that you get no real credit for because no one sees what would have happened had you not taken that decision. It was foresight of the highest order from Matt,” referring to his construction director.
Quintain’s boss is convinced that the size of the contractors it has picked – McAleer & Rushe, McLaren, Sisk and Wates – has benefited the developer. “Having four serious contractors [means] we have senior relationships with – and are important to – all of them,” he says. “That might not be the case dealing with a larger-scale contractor.”
“The Carillion decision looked brave at the time; it clearly looks like genius in retrospect […] It was foresight of the highest order from Matt”
Angus Dodd, Quintain
Those relationships are tested on a daily basis as plans are altered, but the emphasis on keeping the scheme on time and to budget remains.
“One of our challenges certainly with these build-to-rent buildings is that the design is evolving the whole time and we’re learning lessons from building to building,” Mr Dodd adds.
“[We’re] refining the product and that clashes up against fixed-price pre-designed contracts. We need to manage, change, decide, but [not] increase costs materially during the construction period.”
‘No overruns, no claims’
Mr Voyce says any doubts the project’s lenders may have had about handing high-value deals to contractors with no experience of schemes that size were quashed when they started being delivered.
The construction director claims this is because none of its schemes have run late or ended up in litigation.
“The lenders have been with us on the journey from the outset ever since owners Lone Star went private,” Mr Voyce tells CN. “[It] is born out of trust and it’s born out of performance. We don’t deliver buildings late, we don’t have contractual claims, we don’t have cost overruns.”
Mr Voyce says a key to that ability to deliver on time and to budget is a streamlined decision-making process and constant communication. “We talk to all of our contractors on a regular basis at all levels of management,” he says.
Wembley Park Night
“We have frameworks principal meetings where everyone gets around the table and talks about the issues. Whilst we are challenging the programmes that we set, we’re also very fair.”
Project disputes in the industry can escalate when those involved lack the authority to take decisions to resolve a disagreement, something Mr Voyce says Quintain has taken steps to avoid.
“We deal with issues in a very fair and quick way. We’re very streamlined in our management, we can take fleet-of-foot decisions that are in the interest of the job. We don’t allow things to fester; we deal with things head on and that comes from being on site and in the detail.”
Mr Dodd adds that there are other ways to engender goodwill – “things like paying people on time”.
The scale of the site is all the more striking because of the main type of tenure Quintain is planning on the site: build-to-rent.
“If you went out there and asked people, ‘What’s build-to-rent?’, people would look at you blankly,” Mr Dodd tells CN. “We have to sell Wembley as a place and that living here is easy to transact.”
“People are become more and more transitory in their habits, and [build-to-rent] very much sits alongside those sort of trends”
Angus Dodd, Quintain
A relatively new concept in the UK, build-to-rent has been touted as a potential antidote to the housing crisis gripping the capital, although the long-term aspirational message around renting clashes with the government’s stance of “turning generation rent to generation buy”.
“The Conservative government has a lot of messaging around home ownership, but people can’t afford it. It’s a fact of life,” Mr Dodd says. “[With] house prices in London, the minimum deposit you basically need is £100,000 to buy a flat anywhere in the capital. That’s a lot of savings. People are become more and more transitory in their habits, and [build-to-rent] very much sits alongside those sort of trends.”
Demand that can withstand
It’s been suggested that the projected rental rates against which Quintain is planning its Wembley developments are optimistic, especially considering that BTR is yet to be fully established in the UK, and with the economic uncertainty around Brexit a persistent irritation.
Quintain’s chief executive, however, remains remarkably calm about both potential challenges. “What is absolutely clear to us is that demand is extremely elastic,” he says.
“This is not like building an office where you just might not get an office tenant it might not exist at any price. Here, if we drop our rents, occupancy increases; it’s a very elastic supply-demand equation.”
Mr Dodd says that he views placemaking as the key to Wembley’s potential success rather than pricing.
Quintain construction director Matt Voyce
“We could drop the rates here and we’d have people queuing overnight to take the flats. It’s not something we’re worried about. We have to build a place that’s not just a set of dormitory buildings. That’s what will make or break this place, the demand will be there, people will want to live in interesting places.”
And while the firm is taking steps to prepare for any sudden changes in the labour or supplies market as a consequence of Brexit, demand is once again not on Mr Dodd’s list of concerns.
“This is a large site in London. In the long run it will be resistant to whatever happens – I’m convinced of that. London’s housing shortage, the requirement for people in London to have decent places to live and entertaining places to come and shop and drink and eat: that doesn’t disappear just because of some Brexit date.”
“I wish it wasn’t happening but I think we’re in as good a position as any to deal with what happens.”
The Wembley Way: Quintain on surviving Brexit and avoiding Carillion