Canadian institutions Public Sector Pension Investment Board (PSP Investments) and Ontario Teachers’ Pension Plan are investing £1.5bn (€1.76bn) in UK housing in collaboration with specialist real estate investment manager Long Harbour.
Cadillac Fairview, the US$35bn (€29.5bn) real estate arm of Ontario Teachers’, has joined Long Harbour Multi Family (LHMF), a £500m build-to-rent joint venture set up by Long Harbour and PSP Investments in 2019.
Nearly all of the original the capital has been committed and the enlarged platform now has £1.5bn to forward-fund, build and manage private-rented residential assets.
Cadillac Fairview returned to the UK real estate market last year after a six-year hiatus and at the beginning of 2021 hired Jenny Hammarlund as a managing director to lead its activities in Europe.
“The residential sector is a key area of focus for Cadillac Fairview globally, and we are pleased to be investing in the sector at scale in the UK alongside Long Harbour, an innovative build-to-rent operator, and PSP Investments, a strong JV partner with a shared vision,” said Hammarlund.
“This investment aligns with our strategic objective of expanding our investment portfolio in Europe by forming partnerships with best-in-class operators and developers in attractive asset classes, such as residential, life sciences, office and logistics.
“It also complements our global residential portfolio, which includes, large active pipelines across the US and Canada.”
Stéphane Jalbert, managing director of real estate investments for Europe and Asia-Pacific at PSP Investments, said: “We are pleased to continue growing our established and successful partnership with Long Harbour and now Cadillac Fairview, accelerating the scale and diversification potential of the venture.
“UK build-to-rent is a conviction sector for PSP and complements our global residential portfolio. Together, we aim to provide high quality housing that will have a positive impact on local communities while providing stable investment returns.”
LHMF will also incorporate Way of Life, Long Harbour’s residential management business, turning the joint venture in a platform that encompasses investment, development and operational capabilities.
Way of Life already manages more than 2,800 units in operation and under development.
LHMF’s portfolio includes a 480-home development in Tottenham Hale, London, which was forward-funded for £226m across two phases of development. The project is due to be completed in 2023 and the first phase is to be launched this month.
William Astor, CEO of Long Harbour, said: “This latest round of investment brings LHMF’s total capital to in excess of £1.5bn, which, combined with our Way of Life operational capabilities, creates one of the UK’s largest and most compelling build-to-rent platforms. Our priority for new sites will be London and the South East, where we have a strong pipeline of potential assets in addition to our existing projects.
“Way of Life, which is already delivering an innovative, community-focused experience across LHMF’s assets, will be an integral part of the design and delivery of our pipeline of new projects. Directly managing our assets provides greater control over the end-user experience and, ultimately, even stronger long-term performance for investors.”
“We are very pleased to be welcoming Cadillac Fairview to the LHMF platform alongside PSP. This is a long-term, strategic partnership and a strong endorsement for Long Harbour’s vertically integrated model, and our investment, asset management, development and operations capability.”
