In this new series, leaders from across the property industry share their experiences of running a business during the coronavirus crisis and UK lockdown.
Nigel Henry is the co-founder of Fusion. In 2012 the company launched Fusion Students and today has 45 employees. The firm has an operational portfolio of 1,000 beds, two schemes under construction and more in the pipeline. Here, he tells Emma Rosser about his day overseeing the business during the country’s lockdown.
My day (8 April) starts at 6.30am. It has always started at 6.30 and I desperately want to keep to my routine. After a quick scan of the news, I have a workout, normally an indoor bike ride or pilates. I finish that by 8am and am in my study, ready for work at 8.45am.
Every morning is blocked out with call after call, from 9am to 1pm. I speak to my operational team, construction and marketing and sales, and other stakeholders. A lot of these calls used to be weekly, some monthly, but at the moment they are daily, due to the rapidly changing times we find ourselves in.
We don’t know whether universities are going to open for the next academic year, we also don’t know if borders will be open to allow the foreign students into the UK. With this we know we are likely to lose income from now until September, and probably next year too. As a business, we must look at what costs we can save over the next 18 months so that we manage any shortfalls without losing the great team we have.
Around 70% of our students come from China. We have been aware of Covid-19 from the initial news on it in December and we have been working on the potential impacts since then. Initially we were looking at this as a “China” concern. Now, of course, it’s a global concern.
As the virus reached the UK, the first few weeks were just firefighting. We reduced our teams on site, we closed the gyms and cinema rooms, we put all our events online and we looked at separate areas within our buildings that could be used for quarantining.
To our knowledge, we have only had three suspected Covid-19 cases. Many students have returned to their family homes, we currently have about 45% of our rooms being lived in. Discussions have commenced with local authorities for temporary change of use for non-students.
It is 11am, time for the Elevenses. This is a video call with all of our team, whether they are working or have been furloughed. You must bring a cup of tea or coffee and you are not allowed to talk about business. That canteen chat is really important to bring people together and for general well-being.
Next I have a 20-minute update from our construction partner ISG. We have two sites in Swansea and Sheffield and I get a quick overview of what has happened in the past 24 hours. We have a daily tracker on the number of people on site and we check on supply chain issues.
Our buildings are time-critical, and both sites need to be ready for June 2021. In student housing, if you are a day late, you could potentially lose a year of income. If we need to open the site for longer, for example at the weekends, we need to go back to planning.
I’m 55 and I don’t remember having a lunch break since I was about 16, but I am doing it now, between 1pm and 2pm. My wife is at home. I can step away from the screen and have a much needed break from the day.
Back to the office. I’m trying to avoid calls in the afternoon, if I can. As good as Zoom and Teams are, it can become monotonous. I’m Zoomed out! I spend the next couple of hours on e-mails and other parts of the business.
Tomorrow I have a call with a US investor that we have been talking to for six months, negotiating a potential sale of part of the business. They are still very keen and a new partner coming into the business could open us to new acquisitions.
Currently, we are looking at a department store on the south coast that has gone into receivership. In the coming months there may be more distressed sellers out there. We may buy an industrial estate or office building, hold it for a few years with income and then develop it later.
About a month ago we decided to put on ice whatever we were negotiating in Europe and focus on the UK. It is something we want to come back to in the next few months when markets are more transparent and we can travel.
There are some difficult medium-term decisions that we are reviewing at the moment. We have set a target of £1m of cost savings over the next 18 months without impacting the strengths of the business. I am talking with our treasury team to look at various options.
I do my utmost to go for a walk at 4.30pm for a couple of hours. The time at lunch and during these walks is just focusing on the positives. I think people will come out of this horrible time being much nicer and far more understanding of others.
Come September 2021, the student accommodation business, even in a post-Covid-19 recession, will be in good shape with pent-up demand from overseas students. We want to be absolutely ready as business returns to some form of normality. As one of my colleagues said, we will come out of the blocks like Usain Bolt.
To send feedback, e-mail emma.rosser@egi.co.uk or tweet @EmmaARosser or @estatesgazette
