US-based Harrison Street Real Estate Capital has linked up with private real estate investment manager Apache Capital to fund the development of up to seven premium build-to-rent (BTR) schemes across England and Scotland.
The two JV partners, with additional investment from local rural insurer National Farmers Union, have already begun construction on the first of these BTR development schemes, The Lexington, which is located in Liverpool.
The new platform intends to invest on an asset-by-asset basis as construction of the other six Phase One schemes are brought forward over the next 20 months. The seven schemes in Phase One include properties in Birmingham, Edinburgh, Glasgow, Liverpool, Leeds and London (two assets).
The Lexington represents Harrison Street’s first BTR transaction in the UK, the company said.
'We have been closely watching the UK residential market for some time, and are pleased to bring the experience we have acquired investing in and developing high-quality purpose-built student accommodations across the UK, to this venture,' commented Rob Mathias, senior managing director at Harrison Street. 'The JV’s pipeline is very strong and we look forward to evaluating these additional attractive properties as we seek to identify new investment avenues for our clients.'
Apache Capital and its development partner Moda have created within four years one of the largest UK premium BTR portfolios worth £2 bn, comprising over 6,000 homes across 10 schemes secured in prime city centre locations.
Apache said that it will continue to team up with Moda to acquire further development land to expand its £2 bn BTR portfolio. Within the next two years, the company will have acquired a portfolio at least as large as Phase One, which will all be financed, operated and held for the long term.
John Dunkerley, co-founder and CEO of Apache Capital Partners, said: 'These new equity commitments underscore that the UK’s build-to-rent sector is developing into an institutional asset class, attracting long-term global investors. Harrison Street has been investing in and developing student housing assets in the UK since 2015 and we look forward to partnering with them and NFU Mutual as we expand our portfolio, which we will fund and operate with long-term institutional build-to-core investors.'
Trowers & Hamlins, JLL and Macfarlanes acted for Apache Capital. Dentons and DLA Piper served as legal counsel to Harrison Street. Gowling and Knight Frank acted for NFU Mutual.
