G2M Group are a property investment business working with large institutional partners to bring long-term investment to the Private Rented Sector (PRS), helping to alleviate the strain on the UK’s housing stock and address the need for affordable, energy-efficient homes to rent.
G2M has seen rapid growth since it was founded and recently began looking for an insurance broker who could offer a partnership that would add real value to the risk management of their business and assets.
We speak to Theresa Spencer, Chief Operating Officer, and Mike Williams, Head of Finance, to find out more about G2M Group, how they’re working to address some of the issues in the PRS, and how their partnership with Alan Boswell Group will support them with protecting their business as they grow.
Can you start by telling us about G2M?
Theresa: “The business was started in 2012 by Paul Morton, Steve Gardner, and Kyle Gardner, each of whom had their own property interests. At that point, the plan was for a rental and trading business to operate at scale, but they soon recognised the huge opportunity in attracting institutional investment to the PRS. Having secured our first such investor (a large US based Pension fund) in 2020, we now focus on acquiring, regenerating, and managing the rental of existing UK single family properties, growing the G2M team to what is now 35 employees.”
Mike: “The investment in 2020 allowed us to scale much quicker than virtually any other portfolio landlord could – growing from circa 70 rental properties to a portfolio of now almost 2,000.”
The PRS has seen significant challenges in recent years; how is G2M looking to address these?
Theresa: “There is a fundamental challenge around the UK’s lack of decent quality, affordable housing. The predominant view seems to be that building more homes is the best way to address this, but we believe that is not the only solution. 97% of the 4.9 million rental homes in this country are in private ownership, but it’s increasingly challenging for private individuals to invest in their properties so we need to find ways to drive more investment into the existing UK rental stock to raise standards and improve the service offering to residents.
“G2M Group’s core belief is that, if we can shift the ownership profile towards a more institutional footprint, we can accelerate the pace of positive change.”
Mike: “Our model works by attracting patient, institutional investors, motivated to invest for the long term whilst improving the quality of rental homes. We have shown we can do this while offering an asset-based investment producing robust, inflation linked returns combined with capital appreciation. This performance allows us to invest in properties on a much larger scale, while also providing affordable housing to those that need it.”
How are you seeing the sector’s challenges impact private rental ownership?
Theresa: “The last few years have been tough for private property portfolio owners. Tax changes, stamp duty tightening, and other reforms all make the sector much less of an attractive investment for individuals and are forcing private landlords to divest. These, plus the probable increase in regulation, which we favour regardless of which party governs, mean the environment is going to continue to challenge those that may not have the ability to invest for the long-term health of the sector.”
Managing a portfolio of nearly 2000 properties must be quite the challenge. How do you deal with that?
Theresa: “We have dedicated in house teams taking care of property and resident management under our rental brand, Habodel. The teams are on hand daily, dealing with all our resident and property needs. We work with a core group of trusted contractor partners, and have a remote team on the ground that inspects properties, accompanies viewings, and assists people with moving in and out.
“We constantly seek to push for a better service for residents through initiatives like our Sustainable Tenancy Strategy to support residents through difficult periods and have our own Decent Homes Standard (DHS) that sets a consistent benchmark for the quality of our properties. All this runs through our own proprietary tech platform that supports us to manage the end-to-end operation in an automated and efficient way.
“Every day is different, but we have a talented and committed team that keeps everything running smoothly!”
How does your Decent Homes Standard (DHS) fit into the company’s ESG (Environmental, Social & Governance) goals?
Theresa: “Jon Daly, our Head of Sustainability, has enabled us to make great strides through developing our ESG agenda over the last couple of years while ensuring we have a constant focus on improvement planned for the next few years. It is no secret that the UK has the oldest housing stock in Europe and a correspondingly low environmental performance, so sustainability is a hot topic in the sector.
“Our DHS policy helps us to ensure we are providing a sustainable, compliant, and high-quality living experience while regeneration of our housing stock is something we are passionate about; in the last 12 months we have increased the percentage of our portfolio with an EPC grade of A to C by 10%, well in excess of any regulatory requirement. We are heavily invested in making our portfolio more energy-efficient and reducing costs for our residents.”
A large property portfolio is not without significant risk, whether from tenant default, malicious damage, or property damage from storms. How does G2M manage those risks?
Mike: “One of the key factors is resident selection and ensuring we’re able to work with residents who want a long-term home with us. We’ve partnered with RentProfile to help us with selection and referencing, and we focus heavily on resident communication to ensure there is clarity between landlord and resident responsibilities, as well as support in ensuring the best possible management of that asset.
“But even before that, we make sure we understand the risk profile of the property before we purchase it so that we can plan to address any risks identified before we have even bought it.”
Theresa: “One of the reasons we put the insurance out to tender was because we were looking for a partner who could help us with our risk management. That is where you impressed us. Based on your specialisms and experience together with the resources you have available, we felt that Alan Boswell Group could really help us elevate our risk management approach.”
Can you tell us a bit more about the tendering process?
Mike: “We spoke to a number of brokers with a broad profile range, including some very established names within the market. We then held discovery sessions to discuss what we were looking for, and what we wanted from the relationship to encourage an open dialogue from each side. Each broker was very different, but from our conversations with Simon [Ventham, Strategic Account Manager] and Steve [Cox, Business Account Manager], it was clear you had extensive experience in the property sector as well as an innovative culture that focused on looking to help clients develop.
We appreciated your focus and that gave us confidence that you would understand the risks we face.
“We completed the tender process during March [2024], appointing you for our landlord insurance, office and management liability, and engineering inspections.”
How do you see the relationship working going forward?
Mike: “We’ve had initial conversations with Gavin [Dearsley, Risk Management Adviser] to determine what support we can get with managing some specific risks e.g. statutory engineering inspections. We’ve also been looking at strategy with Simon and Steve who have helped us assess where we set our policy excess levels. The claims process has been challenging for us previously, so you have also been helping us look at simplifying and streamlining that process.”
Theresa:
We are looking for a partner, and your team has already started to really deliver on that. For us, it is about staying connected, communicating regularly, and knowing there is expertise we can call on if we need it.
What’s next for G2M?
Theresa: “We are heavily focused on attracting further institutional investment into our business and the PRS. In parallel with that, we are working hard to take our operational excellence to the next level, with multiple improvement initiatives in progress. We are passionate about helping to solve the nation’s housing problem. Our challenge is to illustrate how investing in the existing residential property market can deliver attractive returns but, more importantly, make a real difference to the quality and affordability of the future rental market.”
