PGIM Real Estate and Osborne Developments have acquired a site on behalf of their newly created UK built-to-rent (BTR) investment venture.

The firms said they have bought a site in central Reading to begin construction of 131 homes next year with completion expected in early 2025. The site is currently a vacant office building and car park.

In December last year, PGIM Real Estate formed a joint venture with Osborne Developments to target BTR multifamily opportunities in the UK.

At the time, the companies said the joint venture, which involves PGIM Real Estate’s European Value Partners II, will provide £250m (€299m) of capital towards the “strategy of acquiring land, delivery and stabilisation of new BTR urban developments”.

The Reading site acquisition is the first investment for the venture which targets opportunities in the south, southeast and southwest of England.

Paul Stanford, the head of UK and Ireland at PGIM Real Estate, said: “The UK residential sector continues to offer defensive fundamentals and attractive long-term growth potential, despite the recent short-term market volatility.

“Demand remains robust for these high-quality homes in areas with supply shortage, such as Reading. We are delighted to make our first investment for the venture and look forward to working with the experienced team at Osborne Developments to invest in further strategic sites.”

Ryan Harris the head of land and investment at Osborne Developments, said: “Reading is one of the top performing economies in the UK and benefits from excellent transport links, including the recently opened Elizabeth Line. New professionally managed rental housing is a vital part of the housing supply.

”Recent economic pressures reinforce our business model of a single vehicle to bring new homes forward and we look forward to seeing the first residents make this development their home.”

To read the latest edition of the latest IPE Real Assets magazine click here.