LaSalle Buys Manchester PRS Scheme for c. £110m from Renaker
LONDON (July 17, 2016) – LaSalle has agreed to acquire 497 build to rent apartments in Manchester, for around £110 million from Renaker Build, the region’s leading residential developer.
The development, known as Greengate is located in the historic heart of Salford, close to Manchester city centre, is designed by OMI Architects and comprises high specification apartments split across two residential towers of 21 and 31 storeys.
The homes range in size from one to three bedrooms with most offering either a balcony or terrace and are set in a landscaped communal courtyard. Designed to create a ‘boutique hotel’ feel for future residents, the development provides a high standard of amenities including a resident’s lounge, gym and concierge service.
Greengate is within two minutes’ walk of Deansgate, Harvey Nichols and Selfridges. Manchester Victoria Station, which is currently undergoing a major transformation, is a five minute walk away via a bridge over the River Irwell.
The first phase, which consists of 229 apartments, is now complete and available for private rent through property agents JLL. The second block of 268 units will follow in December 2016.
The sale of the scheme, delivered with the support of funding from the Homes & Communities Agency, marks the most significant UK institutional investment into Manchester’s PRS sector to date.
Tom Henry, Residential Transactions Director, LaSalle Investment Management, said: “There is a systemic undersupply of homes in and around Manchester city centre, as the development pipeline was effectively turned off in 2007. With very few new build completions since then, there is now a dearth of high quality rental apartments with population forecasts predicting an influx of people that equates to an additional requirement of up to 3,000 homes per year. Accordingly, we anticipate strong demand for the apartments.”
Andrew Stanford, UK Residential Fund Manager, LaSalle Investment Management, said: “Access to large-scale PRS opportunities in strong markets are becoming highly sought after. Renting is the predominant tenure for city living and the depth of the tenant market is one of the reasons that Manchester and Salford rank so highly in our multi-factor PRS model. Given the quality and location of our scheme, we intend to follow our model of creating a strong local brand that will position it as Manchester’s premier PRS scheme. Since July 2015, we have exchanged or completed on over £325 million of build to rent transactions, which equates to over 1,600 homes.”
Andy Finch, Head of Sales, Renaker Build, said: “Naturally we are delighted to have concluded the sale, which demonstrates the clear strength of the city centre market, the quality of our product and service, and the commitment to Manchester that major institutional investors are prepared to make.
“Greengate sets new standards of quality for city centre living and will offer a service level and management platform that will ensure that it remains a high-quality and sought after development for many years to come”.
Steve Hogg, Lead Director Regional Residential, JLL, said: “Greengate offers Manchester its first PRS scheme at a time of acute housing shortage. The development is of fantastic quality in a superb location. The apartments themselves are of a very high specification. We will be able to move tenants in by early August and are looking forward to working with LaSalle on this exciting new development.”
Gordon More, Head of Investment, Homes & Communities Agency, said: “We are pleased to support the development of Greengate with £35million of Build to Rent funding which will extend the choice of private rented homes available in the local area. This transaction successfully demonstrates how the Build to Rent Fund is helping to deliver much needed good quality rented homes and is attracting long term institutional investment to increase housing supply in England.
This is a good example of what HCA funding can achieve and is all about.”
LaSalle was advised by JLL.