Apache Capital Partners and Harrison Street are to fund a build-to-rent (BTR) development in central Glasgow that will be delivered and managed over a long-term horizon by UK BTR specialist Moda Living.
The scheme, known as Holland Park, will see the former Strathclyde Police headquarters on Pitt Street replaced by four apartment blocks providing 433 homes for rent in total. Practical completion is due late 2023.
The investment is the fifth project in the BTR joint venture between Apache Capital and Harrison Street. Apache, backed by UK insurer NFU Mutual, and Harrison Street, launched the JV to deliver high quality BTR developments in core cities across the UK.
In addition to Holland Park in Glasgow, current Moda neighbourhoods being funded by the joint venture include The Lexington in Liverpool, The Mercian in Birmingham, New York Square in Leeds, and Springside in Edinburgh, representing a total of 2,322 homes.
Apache Capital and Moda Living purchased the Holland Park site in October 2016. The transaction, which was one of the largest property deals to take place in Scotland after the Brexit result, marked a clear vote of confidence in the Scottish rental market.
As well as creating new homes, Holland Park will provide 15,000 sq ft (1,400 m2) of internal amenities, including communal lounges and health and wellbeing zones.
A further 31,000 sq ft of outdoor amenity space will be provided, with the four apartment buildings that form Holland Park to be set around a courtyard open to the wider public during the day. Mixed commercial and leisure space will be provided on the ground floor, including cafes, bars, restaurants and co-working facilities.
John Dunkerley, CEO and co-founder of Apache Capital Partners said: ‘Alternative residential sectors such as build-to-rent were already seeing increased interest from institutional investors prior to the pandemic thanks to compelling market fundamentals and the promise of liability matching income streams with defensive, counter-cyclical qualities. Covid-19 has further demonstrated the resilience of BTR as an asset class, while we continue to outperform expectations at Angel Gardens in Manchester, our flagship UK BTR development with Moda Living.’
Paul Bashir, CEO of Harrison Street’s European business, said: ‘Glasgow is home to a world-class university, renowned culture and attractive leisure scenes, however there is a significant under-supply of high-quality rental housing, with a lack of highly amenitised purpose-built private rented accommodation.’
Johnny Caddick, CEO at Moda Living, said: ‘Significant institutional investors are more attracted than ever to the BTR sector, driven by the granular income which has proven its resilient qualities during these uncertain times.’
