Workforce Demands Shift Across Residential Investment
For years, conversations around institutional investment in the Living Sector have centred on growth. New developments, expanding portfolios and ambitious Build-to-Rent pipelines have dominated the agenda. But over the past few months, we have seen a real shift in the type of conversations that are taking place across the sector.
The introduction of the Renters’ Rights Act may initially have appeared to be a policy aimed at smaller private landlords. However, its impact is already being felt much more widely, including among institutional investors and operators. In recruitment terms, though, the market is responding quickly. At Madison Berkeley, we are seeing a significant rise in demand for operationally focused talent as investors reassess how residential portfolios are managed in this new environment.
Recent market data suggests that around 220,000 households are expected to leave the private rented sector by the end of 2026, with many smaller landlords deciding to exit the market altogether. For larger institutional investors, this presents an opportunity. Fragmented residential portfolios are increasingly coming to market, and institutions are actively exploring acquiring them. However, these assets are very different from the stabilised Build-to-Rent schemes that many institutions have traditionally focused on. They are often in different parts of the country and are significantly more management-intensive. Acquiring them is one thing but then operating them effectively is another entirely.
This is where the talent challenge becomes particularly interesting. Over recent months, we have seen an increase in demand for asset managers with strong operational capability, including regional operations specialists and compliance-led property management professionals. Institutions are recognising that the successful management of these portfolios requires people who understand the realities of day-to-day residential operations, not simply investment reporting.
One of the biggest pinch points is the shortage of candidates who can bridge both worlds. There are relatively few professionals who understand institutional governance structures and reporting requirements while also having hands-on experience managing complex residential portfolios across mixed-quality stock. Historically, many institutional Living Sector platforms have prioritised acquisition and development expertise. Today, resilience, compliance and operational performance are just as important.
We are also seeing this shift reflected in other areas across the Living Sector. In the Purpose-Built Student Accommodation market, for example, hiring priorities are changing noticeably. Rather than aggressively scaling teams to support expansion, some operators are becoming far more focused on occupancy, retention and asset performance. That means demand is growing for operational leaders with customer experience expertise, revenue management capability and a stronger understanding of performance optimisation. The emphasis is increasingly on making existing assets work harder rather than simply growing portfolios.
Sentiment has evolved quickly, as only a short time ago, many businesses were still focused primarily on growth hiring. Now, we are seeing operational resilience becoming the defining theme across large parts of the Living Sector. This does not mean growth opportunities have disappeared, though. Institutional capital remains highly active in UK residential real estate, and there is still considerable appetite for the Living Sector overall. But investors are becoming more selective about the operational capabilities they need within their businesses. The result is a market where people strategy is becoming increasingly tied to regulatory change and operational complexity. Talent is becoming central to how portfolios are stabilised, scaled and protected.
For the Living Sector, this may ultimately be one of the most important long-term consequences of the Renters’ Rights Act. Regulation is reshaping the organisational structures, operational priorities and leadership skillsets required to manage them successfully.