GRIP Unit Trust, the UK residential property fund owned by APG and Grainger, has acquired a build-to-rent scheme from developer Bouygues in a forward-funding deal worth £33 mln (€44 mln).

GRIP Unit Trust, the UK residential property fund owned by APG and Grainger, has acquired a build-to-rent scheme from developer Bouygues in a forward-funding deal worth £33 mln (€44 mln).

The 90,000 sq ft (8,360 m2) development forms part of the wider Hallsville Quarter masterplan, a new £3.7 bn mixed-use regeneration project in Canning Town, London, which is being undertaken by Bouygues Development in partnership with the London Borough of Newham.

Bouygues has retained a stake in the ownership of the asset as part of its commitment to the build-to-rent sector.

The 16-storey residential tower will provide 134 one- and two-bedroom apartments together with 25 car parking spaces and 4,173 sq ft of resident amenity space. The building is designated for private rented sector use for the first eight years.

The transaction represents the third partnership between Grainger and Bouygues Development, following the development of London Road in Barking, a 100-unit PRS scheme which is currently under construction, and the development of the 211-unit Pontoon Dock.

Bouygues will manage the development and construction process, while Grainger will assume full management responsibilities following completion, including property management, lettings, facility management, and fund and asset management.

Construction is scheduled to begin in January 2015 with completion expected in summer 2017.

GRIP was formed in 2013 by Grainger, the UK’s largest listed residential landlord, and APG, Europe's largest pension fund asset manager, to invest in market-let residential blocks and portfolios focused on London and the South East of the UK, with additional scope to invest in build-to-rent development opportunities.

Tracey Hartley, Grainger’s GRIP fund manager, said: 'The demand for high-quality rented homes far outweighs supply, and PRS represents a long-term rental income and a stable yield for our investors.'