In one of the world’s wealthiest countries, hundreds of thousands of children still go to sleep each night without a bed of their own.

Research by the UK children’s charity Barnardo’s estimates that around 900,000 children in the UK lack a proper bed, meaning they may sleep on the floor, share overcrowded beds, or spend the night on sofas or makeshift arrangements.

A new property development company believes business itself can help address the problem.

Karuna, a newly launched UK developer, has built its model around a simple commitment: a share of every project’s profit will fund beds for children experiencing bed poverty through their partnership with the charity Zarach.

The company highlights that if development profits can generate housing wealth, they can also be structured to tackle social problems directly.

The Business That Bakes In Impact

Karuna is not structured as a charity or philanthropic foundation. It operates as a commercial property developer — acquiring commercial properties, converting them into residential homes and generating profit like any other firm in the sector.

What distinguishes the company is how those profits are allocated.

Karuna has committed one third of profits from each development project to support the work of charity partners committed to eliminating child bed poverty, the first being Zarach, a UK charity that provides beds, bedding and pyjamas to children who would otherwise sleep on floors or sofas.

“Profit isn’t the enemy of impact,” says Karuna founder Andy Howard. “It’s the engine of it. The more we build, the more children get beds.”

Rather than treating social impact as an optional donation or corporate social responsibility programme, the company says the commitment is embedded in its operating model. Each development is intended to generate both commercial returns and direct funding for Zarach’s work.

The announcement coincides with Karuna securing its first development site in Kent, marking the start of its first project under the model. If projections hold, this first development could generate enough funding to provide beds for an estimated 250 children — though Howard is careful to frame this as a projection rather than a guarantee.

The Problem That Shouldn’t Still Exist

The scale of the issue is often surprising to those encountering it for the first time.

Zarach, which works with schools to identify families in need, was founded by Deputy Headteacher Bex Wilson, after a conversation with her 10 year old pupil found that he didn’t have a bed and had been sleeping on a sofa cushion on the floor.The charity delivers beds directly to families referred by schools, typically within days, removing the need for complicated application systems.

Since launching in Leeds in 2018, Zarach has grown significantly. In the twelve months to July 2025, the charity delivered 4,814 beds to children across England — an 18% increase on the previous year. To date, Zarach has delivered more than 16,000 bed bundles in total, and estimates that over 21,600 children have been lifted out of bed poverty as a result.

Zarach now operates across 11 geographical areas of England, including West Yorkshire, South Yorkshire, Tees Valley, Liverpool, and Stockport.

Teachers are often the first to recognise the signs of sleep deprivation. Staff working with Zarach have described children arriving at school exhausted or struggling to concentrate because they do not have a proper place to sleep.

Sleep plays a fundamental role in childhood development, affecting memory, attention, behaviour and emotional regulation. The evidence from Zarach’s own impact data is clear: 95% of school referrers reported a positive effect on the child they referred, after a bed was delivered.

Stories like these are common in Zarach referrals. The issue isn’t neglect; often it is the result of financial pressure, rising living costs, or families facing multiple challenges at once.

Profit With a Purpose Built In

The idea that businesses should embed social purpose into their operations is not new.

Social enterprises and B‑Corp certified companies have long argued that profit and purpose can coexist.

However, the property development sector has traditionally approached social impact through planning obligations such as Section 106 agreements, affordable housing contributions, or community infrastructure levies required by local authorities. Voluntary profit‑sharing arrangements linked to specific social outcomes remain unusual.

Some developers have experimented with similar ideas. For example, a UK developer reported by Property Investor Today announced plans to allocate a substantial share of profits from developments to charitable projects, highlighting the concept as unusual within the sector.

Industry commentary suggests the sector is increasingly being challenged to think more strategically about social value. Real estate consultancy Savills has noted that while many developers now reference “social value”, structured systems linking measurable inputs to specific outcomes remain relatively rare in the industry.

Karuna’s approach attempts to create that structure: a fixed share of profit directed toward a specific social outcome, delivered by an established charity partner.

Why Zarach

For Karuna, the partnership with Zarach offers a clear and measurable pathway from business activity to social impact.

Zarach’s model works through schools, which act as trusted referral points. Teachers, pastoral staff and safeguarding leads identify children without beds and refer families directly to the charity. Zarach then delivers a bed bundle – including mattress, bedding, a bed frame and pyjamas – straight to the home.

The impact is both immediate and visible. A bed arrives; a child sleeps better that night.

Schools working with Zarach have reported improvements in children’s wellbeing and engagement once sleep conditions improve. Referrers consistently describe improvements in attendance, focus and classroom behaviour after interventions.

For Karuna, this clarity matters. Every completed development has the potential to translate into something tangible – beds delivered to children who need them.

“The more profit we make,” Howard says, “the more kids get beds.”

A Question for the Industry

The wider question raised by Karuna’s model is whether similar approaches could scale across the property sector.

The UK faces a persistent housing shortage, and governments across the political spectrum have emphasised the need to increase housebuilding. That expansion will generate substantial development profits across the industry over the coming decade.

If even a small proportion of those profits were structurally directed toward social challenges — whether bed poverty, homelessness prevention or community services — the scale of impact could be significant.

The industry already operates within frameworks that require developers to deliver public benefits, including affordable housing quotas and environmental standards.

Karuna’s approach asks whether social impact commitments could also become part of the commercial architecture of development, rather than discretionary philanthropy after profits are made.

The Bigger Idea

The company’s name offers a clue to the philosophy behind the model.

“Karuna” is a Sanskrit word often translated as compassion — specifically, the desire to alleviate suffering without judgement.

For founder Andy Howard, the name reflects a belief that social problems like bed poverty should not depend solely on charitable giving. Instead, they can be addressed by designing businesses so that commercial success directly contributes to solving them.

Karuna’s first site in Kent marks the beginning of that experiment. They’re starting with just one small development to prove viability, but, unlike the usual charitable donation model, this model can scale, and each additional development increases the funding available to Zarach and the number of children receiving beds.

“No child should sleep on the floor,” Howard says. “It’s a solvable problem and we’re building a scalable solution.”

Whether more developers adopt similar approaches remains to be seen. But the partnership between Karuna and Zarach represents a powerful and impactful solution which connects two worlds that rarely intersect directly: property development profits and the basic need for a child to sleep safely at night.

Zarach provides beds to children experiencing bed poverty across England by working with schools to identify families most in need. More information about its work is available at https://zarach.org and for more information on Karuna, see https://www.karunaimpact.com/

Sources

Zarach 24/25 Annual Report — primary source for all delivery statistics: 4,814 beds delivered August 2024–July 2025; 12,405 total bed bundles since 2018; 16,746 children lifted out of bed poverty; 95% of referrers reported a positive effect; ~900,000 children in bed poverty in the UK (citing Barnardo’s No Crib for a Bed, 2023) https://zarach.org

Child poverty data, End Child Poverty Coalition (2025): https://endchildpoverty.org.uk/child-poverty-2025/

Property sector social value commentary, Savills: https://www.savills.com/impacts/social-change/is-social-value-the-new-real-estate-essential.html

Profit-share developer comparator, Property Investor Today: https://www.propertyinvestortoday.co.uk/breaking-news/2023/4/developer-gives-half-its-profits-to-charities

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